Wipro on Thursday reported four per cent rise in net profit at Rs2,187.7 crore for the June quarter, broadly in line with street expectations.
The city-based firm, which had reported a net profit of Rs2,103.2 crore in the year-ago period, said it expects the coming quarters to be better than the April-June, 2015 period.
Its total income rose 10.5 per cent to Rs12,894.8 crore for the said quarter from Rs11,669.4 crore in the April-June, 2014 quarter.
The firm’s IT services revenue, which constitutes a major share of the firm’s total earnings, saw a sequential growth of 1.1 per cent to $1.79 billion in the said quarter, meeting its revenue guidance of $1,765 million to $1,793 million.
“Over all while we are seeing a stable demand environment, large deals are competitive and there is pressure on pricing in new deals. There is significant churn around the nature of technology consumption across the run and change side of the business,” Wipro CEO and Member of Board T K Kurien told reporters in Bangalore.
Wipro expects to see pick-up in momentum in the second quarter as reflected in the guidance and it expects the second half to be better than the first half of the fiscal, he added.
Dipen Shah, Head of Private Client Group Research at Kotak Securities, said Wipro’s revenue growth of 0.2 per cent in constant currency terms was slightly lower than estimates.
“Growth was largely impacted by continuing softness in the Energy vertical. However, the Q2 guidance of 1.5-3.5 per cent in slightly ahead of expectations,” he said.
For the July-September 2015 quarter, Wipro expects its IT services revenues to be in the range of $1,821 million to $1,857 million. “There are a couple of areas where this quarter performance has been muted. We see energy and utility is coming back in the next quarter... There is going to be growth, it is going to be broad-based across verticals and across service-lines,” Kurien said.
Wipro’s larger rivals TCS and Infosys posted good set of numbers. For the quarter ended June 30, Infosys reported a sequential revenue growth of 4.5 per cent, while TCS posted 3.5 per cent jump.
The IT services segment had a headcount of 1,61,789 as of June 30, 2015, up from 158,217 in March this year with an addition of 3,572 people.
Revenues from IT products segment stood at Rs820 crore, up 7 per cent year-on-year.
Responding to a query on attrition, Wipro Senior Vice President (Human Resources) Saurabh Govil said, “This quarter, there is a slight increase, but if you look at attrition over the last six or seven quarters it has been on a narrow band of one per cent, so it is operating on a very very narrow band.”