Wipro to focus only on large deals, says IT company's top management

Indian IT services company Wipro will focus majorly on large deals in the upcoming quarters, the company management hinted post declaration of its Q1 FY 2023-24 earnings.

The IT company’s Chief Executive Officer Theirry Delaprote said in a post-earnings interaction with analysts, “In total contract value terms, we closed large deals to the tune of $1.2 billion, which is a 9 per cent year-on year growth and actually the highest bookings in eight quarters. During this quarter, we booked 10 deals in the greater than $30 million Total Contract Value (TCV) range. Total bookings from a TCV standpoint stand at $3.7 billion.”

“We added two new accounts in the greater than $100 million revenue bucket, taking the count of businesses that contributes more than $100 million in revenue to 21. So the number of $100 million accounts has more than doubled from 10 to 21,” the CEO added.

Under this plan, Wipro plans on strategically reducing the number of clients to cut the longtail and concentrate on deals with large operating margins.

The IT company’s Chief Financial Officer Jatin Dalal said in a post earnings interaction with the press that the company reduced the number of clients by 100, but has focussed on clients in the $20 million and $ 100 million range.

“We reduced the number of clients by around 100. But we have added six more customers in the $20 million plus range and two more customers in the $100 million plus range. Strategically, we are pivoting our business to doing more value-added work to more strategic (large) customers,” the CFO said, explaining the company’s new approach.

As per the company’s financial results, their active client base stands at 1,444 for the period ended June 2024. Despite the fall in the number of deals, the Total Contract Value (TCV) has increased as compared to previous quarters. Delaporte added that he thinks this is making the company more impactful in the IT sector.

“I believe that we are, every day, becoming more impactful in the market. It’s visible in the deals that we have closed, the large deals that we’ve closed. It’s also visible in the way we are growing our large account and that is showing that our account strategy has been paying off every single quarter for the last 10 quarters. We have doubled the number of $100 million account in two-and-a-half years,” Delaporte said.

Delaporte added that by adopting this approach, the IT services company would be able to best utilise the talent.

“When you are assigning a low margin deal with the client, the temptation of the team is to not mobilize the best players for this project. I want to put my best players on the large deals. It's a completely different approach,” the CEO told Economic Times.

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