Tag Archives: BFSI

Enterprise Major Oracle Plans One Office in Every State Capital As It Sees Higher Tech Spending #Press #Media #CommunicationsToday

Oracle is looking to have branch offices in all Indian state capitals as part of its plan to boost business while some of its larger competitors deal with problems of their own.

Oracle, founded by technology billionaire Larry Ellison, counts companies like HP and IBM as its major competitors. HP is going through a restructuring exercise that may see as many as 50,000 employees cut from its ranks.

Separately, IBM has struck a deal to sell off its x86 server business as it focuses on higher margin products. “We are growing in India and we think that, with the manifesto of the BJP that focussed on technology, we are going to see increased spending on IT. We are looking at a geo-expansion strategy and the plan is to have a branch office in every state capital,” Sandeep Mathur, managing director of Oracle India, told ET.

Currently, Oracle has offices in the five metro cities and places like Pune and Ahmedabad. Mathur declined to give a timeline for the expansion but said it was the company’s stated goal.

The company has been growing steadily in India over the past few years. In 2012-2013, the company grew its revenue 15% to Rs 10,590 crore, according to Dataquest Top 20, making it the tenth-largest technology company by revenue in India.

Oracle does not break out the revenue or growth rate of its India business. “With Oracle, it has been a mixed bag, there has been strong customer demand for their enterprise applications like RightNow and Eloqua and database license renewals have been doing well. But I would think sales of the ExaData and Exologic systems have been a little sluggish outside BFSI and telecom,” said Sanchit Vir Gogia, chief analyst and CEO at Greyhound Research.

ExaData and ExoLogic are part of Oracle of engineered systems business – integrated software and hardware – that promised more efficiency and faster workloads as the components were built to work together rather than stitched together later. The company counts Reliance Commercial Finance, HDFC Securities and HDFC ERGO General Insurance Company as clients.

Source: Communications Today

IT takes an optimistic curve #Press #Media #CommunicationsToday

Despite wage hikes and currency fluctuations, top tier Indian IT firms managed to keep their profits in fine kettle on a year-on-year basis thanks to better utlilisation rates and a slow uptick in the demand environment. The near term looks promising with pricing remaining stable and operating margins being largely under control

India’s largest IT services exporter, Tata Consultancy Services (TCS), is now worth more than R5 lakh crore. It is bigger than the next four biggest Indian IT companies put together. Even with its huge base, TCS continues to generate healthy revenue growth sequentially. In fact among the top three companies—the other two being Infosys and Wipro—TCS was the only one which grew revenues sequentially (2.6%) during the June quarter of the current fiscal and also had the highest growth rate on an annual basis (23%). Infosys reported a decline of 0.8% in revenue growth sequentially while Wipro saw a steeper fall of 10.2% as compared to the preceding quarter.

TCS also has over three lakh employees now, which is almost equal to the number of employees Infosys and Wipro together have on their rolls. Though TCS always enjoyed a higher revenue base but it was Infosys which reported superior operating profit margins (OPM) setting a benchmark for the Indian IT industry. Even this index has undergone a change from the second quarter of FY13 as TCS started to report higher margins. During the quarter, TCS reported an OPM of 26.3% while it was 25.1% for Infosys. Wipro saw a drop in operating margins to 22.8% for the quarter against 24.5% in the previous quarter.

TCS has already stated that it would beat the industry growth guidance of 13-15% in US dollar for the fiscal as projected by Nasscom, while Infosys has retained its revenue guidance at 7-9%. TCS has started FY15 also on a very strong note by recording a 5.5% sequential revenue growth in US dollar terms for the first quarter with volumes growing at 5.7%. Infosys on the other hand grew its revenues only by 2% in the first quarter, with volumes growing by 2.9%. Wipro’s IT services revenue grew by 1.2% and the company does not give full year guidance.

TCS, Infosys, Wipro and HCL Technologies together account for close to 40% of India’s IT services revenues, but the degree of separation between the four have started to tell a story of its own. TCS ended FY14 with a revenue growth of 16.2% in US dollar terms while it was 11.5% for Infosys and 6.4% for Wipro.

Infosys

India’s second largest IT exporter recorded a 1% sequential decline in net profit for the June quarter in dollar terms surprising the markets which had projected a steeper fall in profitability. The company rode on the back of higher volumes and employee utilisation rates to register a net profit of $482 million during the period, sustaining profit margins while delivering a 2% sequential revenue growth in dollar terms. Volumes grew 2.9% for Infosys, which said that an increase in onsite volume, coming after nearly two quarters, pointed to more projects starting onsite, the company said.

Infosys’ consolidated net profit for the quarter grew 15.3% to $482 million from $418 million in the year-ago period, while it had reported profit of $487 million in the January-March stretch. Revenue for the quarter was at $2.1 billion, a growth of 7.1% year-on-year from $1.9 billion and a 2% increase sequentially from $2.09 billion.

In rupee terms, Infosys’ net profit grew 21.6% year-on-year to R2,886 crore compared with R2,374 crore, while it declined 3.5% sequentially from R2,992 crore. Revenues grew 13.3% to R12,770 crore versus R11,267 crore in the corresponding period a year ago. Revenue declined 0.8% from R12,875 crore in the January-March period.

Outgoing CEO SD Shibulal said he was handing over a stronger Infosys to new CEO Vishal Sikka. “When I took over in August 2011, we were faced with a number of external and internal challenges. The 3.0 transition is now complete and only the execution is waiting to happen. FY14 growth has been double that of FY13 and margins are moving in the right direction.”

Operating profit margin, lower by 40 basis points at 25.1%, came in as a positive surprise against analysts’ expectations of a drop of 200-250 basis points from wage hikes and higher visa costs. The IT major attributed this to utilisation level climbing to 80.1% from 76.7% in January-March, and cost optimisation measures kicking in. The margin would have been closer to the 25.5% reported in the previous quarter if not for an $8-million payment to Infosys Foundation, the company said.

Rajiv Bansal, chief financial officer, said that the company has put in place a robust cost structure to keep the margins under check. While margins might vary, it will be roughly around the 25% mark. “We are not worried about the margins. Growth will help us maintain the margin,” he said.

Infosys added 61 new clients during the quarter with a total deal size of $700 million. North America, which contributes 60% in revenues for the company, grew by 3.7% sequentially while Europe declined by 1.1% during the same time period. The India market continued to decline by a substantial margin of 6.9% even as the rest of the world market grew by 1.9% sequentially. The financial services and insurance segment grew 1.8% sequentially whereas manufacturing posted a robust growth of 2.6%. Retail and life sciences grew 2.1%, while energy, utilities, communication and services grew by 1.6% quarter-on-quarter.

TCS

TCS beat Street estimates reporting a profit of R5,058 crore in the first quarter of the current fiscal, a sequential decline of 4.5%. The company’s revenue stood at R22,111 crore, a 2.6% sequential rise while operating income increased 7.4% to R5,815 crore. Despite taking a one-time charge for depreciation, giving employees a wage hike and the appreciation in the currency, the company reported operating margins of 26.3%.

CEO and managing director N Chandrasekaran was confident the current year would be better than FY14, pointing out that the company had reported the second-highest incremental dollar revenues ever in Q1, FY15. “We have seen good growth across geographies and all verticals except BFSI (banking, financial services and insurance) where the growth was somewhat muted,” he said.

TCS won seven large deals during the quarter, spread across verticals including retail, banking, life sciences and high tech. “There are eight large deals in the pipeline,” said Chandrasekaran. He observed that thus far client spends had been in line with the company’s expectations and stressed that the opportunities were essentially around three initiatives—governance, digital and simplification. The company said that pricing remained stable with the industry segments led by media and information services, life sciences, retail and telecom had done well and that non-BFSI verticals grew in excess of 5%.

Wipro

India’s third-largest IT services exporter Wipro saw a 5.4% sequential drop in net profit for the June quarter in dollar terms, meeting Street expectations, impacted by wage hikes and employee stock compensation during the quarter. The IT major, however, remained confident of the overall business momentum, guiding for a revenue growth of 1.7-4% for the second quarter. Net profit for the first quarter stood at $351 million against $371 million in the previous quarter. IT services revenue grew by 1.2% to $1740.2 million during the quarter, falling within its guidance of -0.2-2%. On a year-on-year basis, its IT services revenue grew by 9.6% and net profit rose by 30%.

Wipro CEO TK Kurien said, “The demand environment continues to hold steady. In North America, we see a return of discretionary spending. Continental Europe continues to have significant potential for outsourcing IT services.” It hopes to achieve a revenue forecast of $1,770-1810 million in the second quarter. In rupee terms, the IT services revenue for the quarter stood at R10,508 crore growing annually by 18% while the net profit rose by 30% to touch R2,103 crore. “There is plenty of opportunities in the market for us. It is important for us to win large deals otherwise we cannot match industry growth rate,” said Kurien.

Wipro saw a drop in operating margins to 22.8% for the quarter against 24.5% in the previous quarter. Wipro CFO Suresh Senapaty said, “We continue to drive operational efficiency and invest in our strategy. Operating margins for the quarter was on expected lines, impacted largely due to wage hikes.” Wipro added 35 new customers during the quarter but the revenue growth from the top five and top 10 segment dropped marginally. The IT major also has not made any major addition in the customers’ category of $100 million, $75 million and $50 million. On the future prospects for Wipro, Kurien said, “There is plenty of opportunities in the market for us. It is important for us to win large deals otherwise we cannot match industry growth rate.”

During the quarter, Wipro received a big boost from its infrastructure line business which witnessed a 5% sequential rise. Among the verticals, media & telecom recorded the highest sequential growth of 4.3% followed by healthcare, lifesciences & services at 2.5%. The BFSI segment, which is the largest revenue generator for Wipro showed flattish growth for the quarter. In terms of geographic growth, Wipro’s largest market, Americas, remained flat sequentially at 0.8% and Europe dropped marginally to 0.3%. However, the India & middle-east business grew by 5.3% while for APAC & other emerging markets it was 3.5%.

Human Resources

TCS’ attrition level rose to 12% during the June quarter from 11.3% during the March quarter, which it attributed to the aspirations of the professionals leaving the company to pursue further studies. During Q1 FY15, the employee strength at TCS stood at 3,05,431 on a consolidated basis with people representing 118 nationalities. While gross additions stood at 15,817, net additions stood at 4,967 employees and the utilisation rate was at 85.3% (excluding trainees).

Sanchit Vir Gogia, chief analyst & CEO, Greyhound Research, said, “Employee retention and their happiness is very important to an IT company as it has a direct bearing on customer satisfaction.”

Infosys continues to be challenged by high attrition levels. At the end of the June quarter, attrition stood at 19.5% against 18.7% in the previous quarter and 16.9% a year earlier. The company added 11,506 people in the three-month period, but 10,627 left the organisation, resulting in a net addition of 879 people as against 2001 employees during the preceding quarter. Infosys had 1.61 lakh employees on its roll as on June 30.Infosys said that employee attrition rates are worrisome and it is implementing various initiatives to retain good talent.

Infosys CEO SD Shibulal said, “We tried hard to listen to our employees. The concern was not about compensation but other things like predictability, career growth and variable compensation.” Infosys gave around 7,500 promotions in the quarter and implemented other measures to stem the attrition rate. It has brought down the variable component in the salary, implemented a fast-track career progression cycle and enabled growth opportunities for employees in newer areas of technologies.

For Wipro, the attrition went up marginally by one per cent for the quarter to touch 16.1% driven by seasonality while the company said that it was a sign that the demand coming back to the industry. On the headcount front, the company showed positive signs by adding 1,399 people on a net basis after a year of declining numbers to its overall employee strength. The total headcount at the end of quarter was 147,452 as against 146,053 in the comparable sequential quarter.

Source: Communications Today

IT takes an optimistic curve #Press #Media #TheFinancialExpress

Despite wage hikes and currency fluctuations, top tier Indian IT firms managed to keep their profits in fine kettle on a year-on-year basis thanks to better utlilisation rates and a slow uptick in the demand environment. The near term looks promising with pricing remaining stable and operating margins being largely under control

India’s largest IT services exporter, Tata Consultancy Services (TCS), is now worth more than R5 lakh crore. It is bigger than the next four biggest Indian IT companies put together. Even with its huge base, TCS continues to generate healthy revenue growth sequentially. In fact among the top three companies—the other two being Infosys and Wipro—TCS was the only one which grew revenues sequentially (2.6%) during the June quarter of the current fiscal and also had the highest growth rate on an annual basis (23%). Infosys reported a decline of 0.8% in revenue growth sequentially while Wipro saw a steeper fall of 10.2% as compared to the preceding quarter.

TCS also has over three lakh employees now, which is almost equal to the number of employees Infosys and Wipro together have on their rolls. Though TCS always enjoyed a higher revenue base but it was Infosys which reported superior operating profit margins (OPM) setting a benchmark for the Indian IT industry. Even this index has undergone a change from the second quarter of FY13 as TCS started to report higher margins. During the quarter, TCS reported an OPM of 26.3% while it was 25.1% for Infosys. Wipro saw a drop in operating margins to 22.8% for the quarter against 24.5% in the previous quarter.

TCS has already stated that it would beat the industry growth guidance of 13-15% in US dollar for the fiscal as projected by Nasscom, while Infosys has retained its revenue guidance at 7-9%. TCS has started FY15 also on a very strong note by recording a 5.5% sequential revenue growth in US dollar terms for the first quarter with volumes growing at 5.7%. Infosys on the other hand grew its revenues only by 2% in the first quarter, with volumes growing by 2.9%. Wipro’s IT services revenue grew by 1.2% and the company does not give full year guidance.

TCS, Infosys, Wipro and HCL Technologies together account for close to 40% of India’s IT services revenues, but the degree of separation between the four have started to tell a story of its own. TCS ended FY14 with a revenue growth of 16.2% in US dollar terms while it was 11.5% for Infosys and 6.4% for Wipro.

Infosys

India’s second largest IT exporter recorded a 1% sequential decline in net profit for the June quarter in dollar terms surprising the markets which had projected a steeper fall in profitability. The company rode on the back of higher volumes and employee utilisation rates to register a net profit of $482 million during the period, sustaining profit margins while delivering a 2% sequential revenue growth in dollar terms. Volumes grew 2.9% for Infosys, which said that an increase in onsite volume, coming after nearly two quarters, pointed to more projects starting onsite, the company said.

Infosys’ consolidated net profit for the quarter grew 15.3% to $482 million from $418 million in the year-ago period, while it had reported profit of $487 million in the January-March stretch. Revenue for the quarter was at $2.1 billion, a growth of 7.1% year-on-year from $1.9 billion and a 2% increase sequentially from $2.09 billion.

In rupee terms, Infosys’ net profit grew 21.6% year-on-year to R2,886 crore compared with R2,374 crore, while it declined 3.5% sequentially from R2,992 crore. Revenues grew 13.3% to R12,770 crore versus R11,267 crore in the corresponding period a year ago. Revenue declined 0.8% from R12,875 crore in the January-March period.

Outgoing CEO SD Shibulal said he was handing over a stronger Infosys to new CEO Vishal Sikka. “When I took over in August 2011, we were faced with a number of external and internal challenges. The 3.0 transition is now complete and only the execution is waiting to happen. FY14 growth has been double that of FY13 and margins are moving in the right direction.”

Operating profit margin, lower by 40 basis points at 25.1%, came in as a positive surprise against analysts’ expectations of a drop of 200-250 basis points from wage hikes and higher visa costs. The IT major attributed this to utilisation level climbing to 80.1% from 76.7% in January-March, and cost optimisation measures kicking in. The margin would have been closer to the 25.5% reported in the previous quarter if not for an $8-million payment to Infosys Foundation, the company said.

Rajiv Bansal, chief financial officer, said that the company has put in place a robust cost structure to keep the margins under check. While margins might vary, it will be roughly around the 25% mark. “We are not worried about the margins. Growth will help us maintain the margin,” he said.

Infosys added 61 new clients during the quarter with a total deal size of $700 million. North America, which contributes 60% in revenues for the company, grew by 3.7% sequentially while Europe declined by 1.1% during the same time period. The India market continued to decline by a substantial margin of 6.9% even as the rest of the world market grew by 1.9% sequentially. The financial services and insurance segment grew 1.8% sequentially whereas manufacturing posted a robust growth of 2.6%. Retail and life sciences grew 2.1%, while energy, utilities, communication and services grew by 1.6% quarter-on-quarter.

TCS

TCS beat Street estimates reporting a profit of R5,058 crore in the first quarter of the current fiscal, a sequential decline of 4.5%. The company’s revenue stood at R22,111 crore, a 2.6% sequential rise while operating income increased 7.4% to R5,815 crore. Despite taking a one-time charge for depreciation, giving employees a wage hike and the appreciation in the currency, the company reported operating margins of 26.3%.

CEO and managing director N Chandrasekaran was confident the current year would be better than FY14, pointing out that the company had reported the second-highest incremental dollar revenues ever in Q1, FY15. “We have seen good growth across geographies and all verticals except BFSI (banking, financial services and insurance) where the growth was somewhat muted,” he said.

TCS won seven large deals during the quarter, spread across verticals including retail, banking, life sciences and high tech. “There are eight large deals in the pipeline,” said Chandrasekaran. He observed that thus far client spends had been in line with the company’s expectations and stressed that the opportunities were essentially around three initiatives—governance, digital and simplification. The company said that pricing remained stable with the industry segments led by media and information services, life sciences, retail and telecom had done well and that non-BFSI verticals grew in excess of 5%.

Wipro

India’s third-largest IT services exporter Wipro saw a 5.4% sequential drop in net profit for the June quarter in dollar terms, meeting Street expectations, impacted by wage hikes and employee stock compensation during the quarter. The IT major, however, remained confident of the overall business momentum, guiding for a revenue growth of 1.7-4% for the second quarter. Net profit for the first quarter stood at $351 million against $371 million in the previous quarter. IT services revenue grew by 1.2% to $1740.2 million during the quarter, falling within its guidance of -0.2-2%. On a year-on-year basis, its IT services revenue grew by 9.6% and net profit rose by 30%.

Wipro CEO TK Kurien said, “The demand environment continues to hold steady. In North America, we see a return of discretionary spending. Continental Europe continues to have significant potential for outsourcing IT services.” It hopes to achieve a revenue forecast of $1,770-1810 million in the second quarter. In rupee terms, the IT services revenue for the quarter stood at R10,508 crore growing annually by 18% while the net profit rose by 30% to touch R2,103 crore. “There is plenty of opportunities in the market for us. It is important for us to win large deals otherwise we cannot match industry growth rate,” said Kurien.

Wipro saw a drop in operating margins to 22.8% for the quarter against 24.5% in the previous quarter. Wipro CFO Suresh Senapaty said, “We continue to drive operational efficiency and invest in our strategy. Operating margins for the quarter was on expected lines, impacted largely due to wage hikes.” Wipro added 35 new customers during the quarter but the revenue growth from the top five and top 10 segment dropped marginally. The IT major also has not made any major addition in the customers’ category of $100 million, $75 million and $50 million. On the future prospects for Wipro, Kurien said, “There is plenty of opportunities in the market for us. It is important for us to win large deals otherwise we cannot match industry growth rate.”

During the quarter, Wipro received a big boost from its infrastructure line business which witnessed a 5% sequential rise. Among the verticals, media & telecom recorded the highest sequential growth of 4.3% followed by healthcare, lifesciences & services at 2.5%. The BFSI segment, which is the largest revenue generator for Wipro showed flattish growth for the quarter. In terms of geographic growth, Wipro’s largest market, Americas, remained flat sequentially at 0.8% and Europe dropped marginally to 0.3%. However, the India & middle-east business grew by 5.3% while for APAC & other emerging markets it was 3.5%.

Human Resources

TCS’ attrition level rose to 12% during the June quarter from 11.3% during the March quarter, which it attributed to the aspirations of the professionals leaving the company to pursue further studies. During Q1 FY15, the employee strength at TCS stood at 3,05,431 on a consolidated basis with people representing 118 nationalities. While gross additions stood at 15,817, net additions stood at 4,967 employees and the utilisation rate was at 85.3% (excluding trainees).

Sanchit Vir Gogia, chief analyst & CEO, Greyhound Research, said, “Employee retention and their happiness is very important to an IT company as it has a direct bearing on customer satisfaction.”

Infosys continues to be challenged by high attrition levels. At the end of the June quarter, attrition stood at 19.5% against 18.7% in the previous quarter and 16.9% a year earlier. The company added 11,506 people in the three-month period, but 10,627 left the organisation, resulting in a net addition of 879 people as against 2001 employees during the preceding quarter. Infosys had 1.61 lakh employees on its roll as on June 30.Infosys said that employee attrition rates are worrisome and it is implementing various initiatives to retain good talent.

Infosys CEO SD Shibulal said, “We tried hard to listen to our employees. The concern was not about compensation but other things like predictability, career growth and variable compensation.” Infosys gave around 7,500 promotions in the quarter and implemented other measures to stem the attrition rate. It has brought down the variable component in the salary, implemented a fast-track career progression cycle and enabled growth opportunities for employees in newer areas of technologies.

For Wipro, the attrition went up marginally by one per cent for the quarter to touch 16.1% driven by seasonality while the company said that it was a sign that the demand coming back to the industry. On the headcount front, the company showed positive signs by adding 1,399 people on a net basis after a year of declining numbers to its overall employee strength. The total headcount at the end of quarter was 147,452 as against 146,053 in the comparable sequential quarter.

Source: The Financial Express

Wipro Q1 profit up 29.5% as IT spending returns in North America #Press #Media #ZeeBiz

IT services major Wipro today reported a 29.5 percent growth in its consolidated net profit at Rs 2,103.2 crore for April-June period, helped by large deals in the application and infrastructure space.

The city-headquartered firm had posted a net profit of Rs 1,623.3 crore in the year-ago period, it said in a BSE filing.

Consolidated net sales rose by 15.5 per cent to Rs 11,245.5 crore in April-June quarter of the current fiscal from Rs 9,733.2 crore in the same quarter of 2013-14.

The figures are in accordance with International Financial Reporting Standards (IFRS).

Wipro Chairman Azim Premji said: “We see a significant rise in business confidence in developed markets as well as India.”

The new government at the Centre has brought about hope and confidence in the minds of all stakeholders through reform pronouncements with fiscal prudence, he added.

In US dollars, Wipro reported a net profit of $351 million and revenue of $1.9 billion.

Revenue from IT Services stood at $1.74 billion, a quarter-on-quarter increase of 1.2 per cent and year-on-year increase of 9.6 per cent. Wipro had guided this to be in the range of $1.715 billion-$1.755 billion.

For the July-September quarter, the IT services revenue is forecast to be in the range of $1.77 billion-$1.81 billion.

“We continue to win large deals particularly in the application and infrastructure space. We recently announced our largest ever total outsourcing deal,” Wipro CEO T K Kurien said.

These wins demonstrate confidence of clients in Wipro’s transformational capabilities and re-affirm their faith in its client engagement strategy, he added.

IT Services revenue in rupee terms was Rs 10,510 crore, an increase of 18 per cent year-on-year.

The IT services segment had 147,452 employees as of June 30, 2014 and the firm added 35 new customers for the quarter.

“We continue to drive operational efficiency and invest in our strategy. Operating margins for the quarter was on expected lines, impacted largely due to wage hikes,” Wipro CFO Suresh Senapaty said.

Analysts said the April-June quarter has been lukewarm for the country’s third largest IT services firm.

“Its been a lukewarm period overall for the IT industry at large, including Wipro. That said, few contracts over the last quarter has helped Wipro get access to more high-profile deals at a time when outsourcing demand looks stronger as compared to previous years,” Greyhound Research CEO Sanchit Vir Gogia said.

Wipro shares today rose by 1.31 per cent to close at Rs 576.80 apiece at the BSE.

Wipro’s IT products segment delivered revenue of Rs 770 crore, registering a decline of 6 per cent over the year-ago period, after Wipro’s strategy to focus on services business by engaging in selective transformational deals where products form an integral part of the solution.

Segment wise, BFSI contributed the most towards Wipro’s revenues in the first quarter followed by Manufacturing & Hi-tech, Energy, Natural Resources & Utilities, Global Media & Telecom, Retail, Consumer, Transport & Government and Healthcare & Life Sciences.

Geography wise, the US was the main revenue generator followed by Europe, Rest of the World and India.

Last week, Wipro had announced that it had entered into a multi-million dollar dual pact with ATCO through which the company will provide a complete suite of outsourcing solutions to the Canadian firm as well as acquire its IT services arm.

Wipro signed a series of Master Services Agreements with ATCO under which it will acquire ATCO’s IT subsidiary for an all-cash consideration of CAD 210 million ($195 million or over Rs 1,176 crore).

Besides, Wipro also secured a 10-year IT deal with ATCO for providing outsourcing services, that will result in annual revenues of over CAD 120 million ($112 million or over Rs 675 crore) for Wipro for the next 10-years.

Gogia said ATCO deal will definitely add to Wipro’s overall growth, particularly in the Utilities vertical.

“However, currently it is early to comment on the actual benefits and outcomes will only be visible once all formalities have been completed,” he added.

Going ahead, Gogia said the company is expected to gain substantially if it manages to crack the Rs 1,200 crore call centre deal from Reliance Communications.

Separately, its active conversations with the government on various pending issues like taxation and allotment of new SEZ are clear signs of the expected growth in the near future.

Wipro is also planning to invest in upcoming software firms, a clear sign of their intent to also sell software to their customer base, Gogia said.

Attrition still remains one of the key issues that the management needs to address, he added.

Gogia said attrition still remains one of the key issues that the management needs to address.

Wipro Senior VP Human Resources Saurabh Govil said: “We have RSUs, and salary increases so we expect to see impact of that in the coming quarters.

“Also, we are seeing that among the high performers at Wipro, attrition rates have fallen drastically, which makes for about 25 per cent of our total workforce.”

Last week, Wipro had announced that it signed a series of Master Services Agreements with ATCO under which it will acquire ATCO’s IT subsidiary for an all-cash consideration of CAD (Canadian dollar) 210 million (USD 195 million or over Rs 1,176 crore).

Besides, Wipro also secured a 10-year IT deal with ATCO for providing outsourcing services, that will result in annual revenues of over CAD 120 million (USD 112 million or over Rs 675 crore) for Wipro for the next 10-years.

Gogia said ATCO deal will definitely add to Wipro’s overall growth, particularly in the Utilities vertical. Going ahead, Gogia said the company is expected to gain substantially if it manages to crack the Rs 1,200 crore call centre deal from Reliance Communications.

Separately, its active conversations with the government on various pending issues like taxation and allotment of new SEZ are clear signs of the expected growth in the near future.

Wipro is also planning to invest in upcoming software firms, a clear sign of their intent to also sell software to their customer base, Gogia said.

Source: Zee Biz

Wipro Q1 profit rises 29.5 per cent to Rs 2,103 crore #Press #Media #IBNLive

For the July-September quarter, the IT services revenue is forecast to be in the range of $1.77 billion-$1.81 billion

IT services major Wipro today reported a 29.5 percent growth in its consolidated net profit at Rs 2,103.2 crore for April-June period, helped by large deals in the application and infrastructure space.

The city-headquartered firm had posted a net profit of Rs 1,623.3 crore in the year-ago period, it said in a BSE filing.

Consolidated net sales rose by 15.5 per cent to Rs 11,245.5 crore in April-June quarter of the current fiscal from Rs 9,733.2 crore in the same quarter of 2013-14.

The figures are in accordance with International Financial Reporting Standards (IFRS).

Wipro Chairman Azim Premji said: “We see a significant rise in business confidence in developed markets as well as India.”

The new government at the Centre has brought about hope and confidence in the minds of all stakeholders through reform pronouncements with fiscal prudence, he added.

In US dollars, Wipro reported a net profit of $351 million and revenue of $1.9 billion.

Revenue from IT Services stood at $1.74 billion, a quarter-on-quarter increase of 1.2 per cent and year-on-year increase of 9.6 per cent. Wipro had guided this to be in the range of $1.715 billion-$1.755 billion.

For the July-September quarter, the IT services revenue is forecast to be in the range of $1.77 billion-$1.81 billion.

“We continue to win large deals particularly in the application and infrastructure space. We recently announced our largest ever total outsourcing deal,” Wipro CEO T K Kurien said.

These wins demonstrate confidence of clients in Wipro’s transformational capabilities and re-affirm their faith in its client engagement strategy, he added.

IT Services revenue in rupee terms was Rs 10,510 crore, an increase of 18 per cent year-on-year.

The IT services segment had 147,452 employees as of June 30, 2014 and the firm added 35 new customers for the quarter.

“We continue to drive operational efficiency and invest in our strategy. Operating margins for the quarter was on expected lines, impacted largely due to wage hikes,” Wipro CFO Suresh Senapaty said.

Analysts said the April-June quarter has been lukewarm for the country’s third largest IT services firm.

“Its been a lukewarm period overall for the IT industry at large, including Wipro. That said, few contracts over the last quarter has helped Wipro get access to more high-profile deals at a time when outsourcing demand looks stronger as compared to previous years,” Greyhound Research CEO Sanchit Vir Gogia said.

Wipro shares today rose by 1.31 per cent to close at Rs 576.80 apiece at the BSE.

Wipro’s IT products segment delivered revenue of Rs 770 crore, registering a decline of 6 per cent over the year-ago period, after Wipro’s strategy to focus on services business by engaging in selective transformational deals where products form an integral part of the solution.

Segment wise, BFSI contributed the most towards Wipro’s revenues in the first quarter followed by Manufacturing & Hi-tech, Energy, Natural Resources & Utilities, Global Media & Telecom, Retail, Consumer, Transport & Government and Healthcare & Life Sciences.

Geography wise, the US was the main revenue generator followed by Europe, Rest of the World and India.

Last week, Wipro had announced that it had entered into a multi-million dollar dual pact with ATCO through which the company will provide a complete suite of outsourcing solutions to the Canadian firm as well as acquire its IT services arm.

Wipro signed a series of Master Services Agreements with ATCO under which it will acquire ATCO’s IT subsidiary for an all-cash consideration of CAD 210 million ($195 million or over Rs 1,176 crore).

Besides, Wipro also secured a 10-year IT deal with ATCO for providing outsourcing services, that will result in annual revenues of over CAD 120 million ($112 million or over Rs 675 crore) for Wipro for the next 10-years.

Gogia said ATCO deal will definitely add to Wipro’s overall growth, particularly in the Utilities vertical.

“However, currently it is early to comment on the actual benefits and outcomes will only be visible once all formalities have been completed,” he added.

Going ahead, Gogia said the company is expected to gain substantially if it manages to crack the Rs 1,200 crore call centre deal from Reliance Communications.

Separately, its active conversations with the government on various pending issues like taxation and allotment of new SEZ are clear signs of the expected growth in the near future.

Wipro is also planning to invest in upcoming software firms, a clear sign of their intent to also sell software to their customer base, Gogia said.

Attrition still remains one of the key issues that the management needs to address, he added.

Gogia said attrition still remains one of the key issues that the management needs to address.

Wipro Senior VP Human Resources Saurabh Govil said: “We have RSUs, and salary increases so we expect to see impact of that in the coming quarters.

“Also, we are seeing that among the high performers at Wipro, attrition rates have fallen drastically, which makes for about 25 per cent of our total workforce.”

Last week, Wipro had announced that it signed a series of Master Services Agreements with ATCO under which it will acquire ATCO’s IT subsidiary for an all-cash consideration of CAD (Canadian dollar) 210 million (USD 195 million or over Rs 1,176 crore).

Besides, Wipro also secured a 10-year IT deal with ATCO for providing outsourcing services, that will result in annual revenues of over CAD 120 million (USD 112 million or over Rs 675 crore) for Wipro for the next 10-years.

Gogia said ATCO deal will definitely add to Wipro’s overall growth, particularly in the Utilities vertical. Going ahead, Gogia said the company is expected to gain substantially if it manages to crack the Rs 1,200 crore call centre deal from Reliance Communications.

Separately, its active conversations with the government on various pending issues like taxation and allotment of new SEZ are clear signs of the expected growth in the near future.

Wipro is also planning to invest in upcoming software firms, a clear sign of their intent to also sell software to their customer base, Gogia said.

Source: IBNLive

Wipro Q1 IT svcs sales at $1.74 bn; guides $1.77-1.81 bn Q2 #Press #Media #MoneyControl

IT services major Wipro today reported a 29.5 per cent growth in its consolidated net profit at Rs 2,103.2 crore for April-June period, helped by large deals in the application and infrastructure space.

The Bangalore -headquartered firm had posted a net profit of Rs 1,623.3 crore in the year-ago period, it said in a BSE filing.

Its June quarter IT services revenues rose 5 percent over the April quarter, to Rs 11,140 crore, compared to a CNBC-TV18 poll estimate of Rs 10699 crore. However, dollar revenues at USD 1740.2 million were marginally below the poll estimate of USD 1745 million.

Dollar revenues were up 1.16 percent quarter-on-quarter. The figures are in accordance with International Financial Reporting Standards (IFRS).

Operating margins were down to 22.8 percent from 24.5 percent in the previous quarter, with the company attributing the decline to wage hikes.

For the September quarter the company has guided for IT services revenues in the USD 1770-1810 million range, up 1.72-4 percent quarter-on-quarter. The company said the September quarter revenue guidance was based on a rupee-dollar rate of 59.66.

Wipro chairman Premji said he saw a significant rise in business confidence in developed markets. The new government at the Centre has brought about hope and confidence in the minds of all stakeholders through reform pronouncements with fiscal prudence, he added.

Wipro CEO TK Kurien said the company continued to win large deals in the application and infrastructure services segments. These wins demonstrate confidence of clients in Wipro’s transformational capabilities and re-affirm their faith in its client engagement strategy, he added. Chief Financial Officer Suresh Senapathy said the company would continue to improve operational efficiencies, and invest in strategy.

IT Services revenue in rupee terms was Rs 10,510 crore, an increase of 18 per cent year-on-year.

The IT services segment had 147,452 employees as of June 30, 2014 and the firm added 35 new customers for the quarter. “We continue to drive operational efficiency and invest in our strategy. Operating margins for the quarter was on expected lines, impacted largely due to wage hikes,” Wipro CFO Suresh Senapaty said.

Analysts said the April-June quarter has been lukewarm for the country’s third largest IT services firm.

“Its been a lukewarm period overall for the IT industry at large, including Wipro. That said, few contracts over the last quarter has helped Wipro get access to more high-profile deals at a time when outsourcing demand looks stronger as compared to previous years,” Greyhound Research CEO Sanchit Vir Gogia said.

Wipro’s IT products segment delivered revenue of Rs 770 crore, registering a decline of 6 per cent over the year-ago period, after Wipro’s strategy to focus on services business by engaging in selective transformational deals where products form an integral part of the solution.

Segment wise, BFSI contributed the most towards Wipro’s revenues in the first quarter followed by Manufacturing & Hi-tech, Energy, Natural Resources & Utilities, Global Media & Telecom, Retail, Consumer, Transport & Government and Healthcare & Life Sciences.

Geography wise, the US was the main revenue generator followed by Europe, Rest of the World and India.

Last week, Wipro had announced that it had entered into a multi-million dollar dual pact with ATCO through which the company will provide a complete suite of outsourcing solutions to the Canadian firm as well as acquire its IT services arm.

Wipro signed a series of Master Services Agreements with ATCO under which it will acquire ATCO’s IT subsidiary for an all-cash consideration of CAD 210 million (USD 195 million or over Rs 1,176 crore). Besides, Wipro also secured a 10-year IT deal with ATCO for providing outsourcing services, that will result in annual revenues of over CAD 120 million (USD 112 million or over Rs 675 crore) for Wipro for the next 10-years.

Gogia said ATCO deal will definitely add to Wipro’s overall growth, particularly in the Utilities vertical. “However, currently it is early to comment on the actual benefits and outcomes will only be visible once all formalities have been completed,” he added. Going ahead, Gogia said the company is expected to gain substantially if it manages to crack the Rs 1,200 crore call centre deal from Reliance Communications. 

Separately, its active conversations with the government on various pending issues like taxation and allotment of new SEZ are clear signs of the expected growth in the near future.

Wipro is also planning to invest in upcoming software firms, a clear sign of their intent to also sell software to their customer base, Gogia said.

Attrition still remains one of the key issues that the management needs to address, he added.

Wipro shares today rose by 1.31 per cent to close at Rs 576.80 apiece at the BSE.

(With inputs from PTI)

Source: Moneycontrol.com