Wipro Q1 Net up 29.5% as IT spending returns in North America

IT services major Wipro today reported a 29.5 per cent growth in consolidated net profit for April-June period, helped by large deals in application and infrastructure space as well as return of discretionary spending in the North American market.
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 of the country's third largest IT services firm rose 15.5 per cent to Rs 11,245.5 crore in April-June quarter this fiscal from Rs 9,733.2 crore in the same quarter of 2013-14. Figures are in 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 USD 351 million and revenue of USD 1.9 billion.

Revenue from IT Services stood at USD 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 USD 1.715 billion-USD 1.755 billion.
For the July-September quarter, the IT services revenue is forecast to be in the range of USD 1.77 billion-USD 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.
Speaking to reporters after the result announcements, Kurien said Wipro had a quarter-on-quarter revenue growth of 1.2 per cent, which was in line with the guidance.
On the demand environment, he said: "Demand continues to hold steady. In North America, we see return of discretionary spending, while Continental Europe continues to have significant potential for outsourcing IT services."
"We see strong demand in healthcare and life sciences which grew 20 per cent y-o-y in revenue this quarter. Business momentum is improving in manufacturing & hi-tech, while we challenges in retail," Kurien said.

On service lines, global infrastructure services continue to score good wins with a sequential growth of 5 per cent. The business in India and Middle East also witnessed good growth.
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 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 compared to previous years," Greyhound Research CEO Sanchit Vir Gogia said.
Wipro shares today closed higher by 1.31 per cent at Rs 576.80 apiece at the BSE.