Wipro Q3 net profit up 10% at Rs 1,318.8 cr

Information Technology major Wipro on Friday reported a 9.60 per cent increase in consolidated net profit at Rs 1,318.8 crore for the third quarter ended December 31, 2010.

The company had a net profit of Rs 1,203.2 crore in the corresponding quarter of the previous financial year, it said in a filing to the Bombay Stock Exchange.

For the fourth quarter ending March 31, Wipro expects revenues from IT services business to be in the range of $1,384-1,411 million, a sequential increase of 3 to 5 per cent.

"We announce the appointment of T K Kurien as CEO of IT Business and Wipro Executive Director, with effect from February 1. The Joint CEO structure was one of the key factors that successfully helped us navigate the worst economic crisis of our times," Chairman Azim Premji said.

Net income from sales rose to Rs 7,829.3 crore for the December quarter, against Rs 6,977.4 crore in the third quarter of last financial year, it said.

Wipro Chairman Azim Premji said that the company underperformed in the October-December quarter relative to competitors and its own potential. "I dont think we should try making excuses about our performance. We have under performed in quarter three relative to our competitors and as relative to our potential as a company," he told reporters here today.

"What we are trying to do is trying to improve perfomance in quarter four and also significantly improving performance going forward," he added.

Wipro has not been able to take similar strides in the health and financial sector as the competition has done, Premji said.

The board of directors have proposed an interim dividend of Rs 2 per equity share on the face value of Rs 2 to its shareholders.

IT services business, which contributed 76 per cent of the total revenue during the reporting quarter, added 36 new clients, the company said.

"The operating margins for IT Services Business was flat, despite lower working days and drop in utilisation," Executive Director & CFO Suresh Senapaty said.

The company's IT services revenue grew 15 per cent at Rs 7,829 crore, over the same period last year. The company added 3,591 net employees in this quarter, taking the total head count to 1.19 lakh employees as of December 31.

It had cash and cash equivalents to the tune of Rs 6,487.8 crore as on December 31, 2010. On standalone basis, Wipro posted a marginal dip in net profit at Rs 1,223.7 crore for the reported quarter. It had a net profit of Rs 1,231.2 crore in the same quarter last year.