Goutam Das
Wipro's IT services business continued its string of poor performances, reporting
the lowest September-quarter revenue growth among top-rung Indian IT services companies.
The company's topline grew only 1.7 per cent sequentially (over the June quarter). In comparison, Tata Consultancy Services' (TCS) topline rose 4.6 per cent, HCL's rose 3.2 per cent and Infosys recorded a 2.6 per cent increase over the same period.
ALSO READ: Wipro hives off non-IT businesses However, Wipro's IT services revenue of $1.54 billion was in line with analysts' tempered estimates for the quarter.
The company
reported operating margins of 20.7 per cent and said it could maintain better pricing on contracts - pricing improved 1.4 per cent onsite and 1.1 per cent offshore.
While equity analysts were surprised at the pricing improvement, they said it could be an aberration.
"Realisations have improved significantly but this can be a quarterly variation. The pricing increase this quarter doesn't mean it will be the trend going forward," said Dipen Shah, an analyst with Kotak Securities.
PERSPECTIVE: What Wipro's de-merger means for Azim Premji Asked when he sees Wipro growing strongly again, Shah said he expected growth rates to improve in the next three quarters because of stability in the Europe and US markets.
T.K. Kurien, Wipro's CEO, said the company had seen an uptick in
deal closures towards the end of the September quarter. From a business unit standpoint, telecom continues to be a drag on the results.
Wipro's shares rose 1.15 per cent to Rs 365.55 in morning trading on the Bombay Stock Exchange but market watchers opined that this may have more to do with the company's de-merger announcement.
On Thursday, Wipro said it
would hive off its non-IT businesses - Wipro Consumer Care and Lighting, Medical Diagnostic Product and Services, and Wipro Infrastructure Engineering, into a separate entity that will be called Wipro Enterprises Limited.
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