Wipro Q2 net up marginally at Rs 1,301 cr

Wipro Ltd, India's No. 3 software services exporter, posted a 1% rise in net profit at Rs 1,301 crore for the quarter ended September 2011, thanks to a weaker rupee and rise in spending on outsourcing by overseas clients.

It was Rs 1,285 crore for the same period a year ago. Total income also rose 18.2% to Rs 9,306 crore from Rs 7,872 crore a year ago.

"Macroeconomic sentiments continue to remain uncertain," Wipro's billionaire Chairman Azim Premji said in a statement. "(But) we have seen growth momentum build up in our IT business with healthy volume growth."

The revenues of flagship IT Services contributed around 75% of the total revenues and 92% of operating income for the quarter ended September 30, 2011. The IT services revenues of the India’s third largest IT exporter posted a growth of 19% to Rs 6,829 crore when compared to the same period last year.  

The IT services' earnings before interest and tax (EBIT) was Rs 1,364 crore, an increase of 7% yoy, the operating income to revenue for IT Services was 20% for the quarter.

The IT Services segment added around 5,240 employees this quarter taking the total employee strength to 131,730 people as of September 30, 2011. During the quarter under review Wipro added 44 new customers to its IT services business.

Going forward the company expects to see its revenues from the IT Services business to be in the range of Rs 7,350 to Rs 7,500 crore for the period ending December 31, 2011.

The IT products business, which contributed around 11% of the total revenues for the quarter stood at Rs 1,000 crore, a y-o-y decline of 6%.

The company’s revenue from consumer care and lighting business segment recorded revenues of Rs 800 crore for the quarter ended September 30, 2011, representing a y-oy- increase of 20%.

Wipro, also listed on the New York Stock Exchange, has been lagging its bigger rivals in earnings growth in recent quarters that led to a reorganisation of its key IT outsourcing business earlier this year.

As part of the restructuring, the company removed the joint chiefs of the IT business and named company veteran T K Kurien as the new chief executive.

The company added 44 new clients in its IT services business during the quarter

Wipro's shares have fallen nearly 24% this year, compared with a 16% drop in the sector index and a 12.6% fall in the Bombay Stock Exchange.