Wipro's consolidated Q1 net surges 97%

BANGALORE: Profit after tax for Wipro has grown by 97 per cent to Rs 2.14

billion and net sales by 28 per cent year on year to Rs 7.98 billion for the

first quarter ended on June 2001, said Wipro Limited chairman Azim Premji. He

was speaking at a press conference to announce the Q1 financial results, in

Bangalore, on Friday.

Wipro alone posted a 93 percent rise in net profit to Rs 2.08 billion or Rs

8.92 per diluted share, compared to Rs 1.08 billion or Rs 4.67 per diluted share

in the year ago period.

Acknowledging that the IT giant was experiencing pricing pressure from

clients, Wipro vice-chairman Vivek Paul, said this had forced them to hike their

billing rate to 3 to 4 per cent. But with a $70 million-contract from a telecom

subsidiary of Lattice Group plc, an FTSE 100 company, we expect revenue in

excess of $30 million this fiscal. This will help us in growing in the European

market, he said.

Officials also stated that on the volume front they had witnessed a

sequential decline of four per cent in offshore and five per cent in onsite man

months billed. "The reduction is primarily due to decline in business from

GE and computing platform and telecom equipment manufacturers," said Paul.

Detailing the performance of Wipro technologies which represents Wipro’s

global IT services business, Paul said the price realization for offshore

projects had increased by 15 per cent and those for on site by 16 per cent year

on year and 3.4 per cent and 2.6 per cent respectively, sequentially.

"Our largest customer (Nortel) and top five and the top 10 customers,

accounted for eight per cent, 29 per cent and 42 per cent, respectively, of our

total revenue for the quarter ended June 30, 2001. This is in contrast to 10 per

cent, 32 per cent and 47 per cent, respectively, for the corresponding period in

the previous year," said Vivek Paul.

This apart, officials said the firm had added twenty-five new accounts in the

quarter while new customers accounted two percent of the revenue for the

quarter. On the recruitment front, Paul said all campus recruitment had been

deferred for this quarter. Future recruitment will be carried out only on a need

basis, he said.

Wipro officials also dropped enough hints that there had been no new

retrenchments apart from the usual 12 per cent attrition that they were

presently experiencing.

According to a company release, Wipro had 9,795 employees as of June 30,

2001. Gross addition in the quarter ended June 30, was 158. And consequent to

297 separations (both voluntary and otherwise) there was a net decline in the

number of people by 139, as compared to March 31, 2001.

Commenting on the future growth, Premji said, "We will continue to grow

ahead by 40 to 45 per cent of the industry growth rates. With our new contract,

we expect our growth to increase in the second half of this fiscal year."