Wipro Ltd's weaker-than-expected quarterly sales forecast highlighted a gap in performance among India's four biggest IT exporters and a still shaky recovery in client demand.
Wipro, which reported a 17% year-on-year increase in net profit to Rs. 1,729 crore during the January-March quarter, joined Infosys in delivering tepid revenue guidance, citing a delay in the closure of deals. The forecasts contrast with a more bullish outlook issued by industry leader Tata Consultancy Services that had raised expectations IT spending by clients in the US and Europe was improving.
The company had reported a net profit of Rs. 1,481 crore in the year-ago period.
Revenue during the quarter stood at Rs. 11,026 crore, a 12% rise from the year-ago period, in line with its forecast.
For the first three months of the current fiscal year (April- June), Wipro expects a flat revenue growth in the range of $1,575-1610 million. "We had some delays in deal closure during the last quarter, which we expect to achieve during the current quarter," said Suresh Senapaty, executive director and chief financial officer, Wipro, explaining the flat revenue growth outlook.
Wipro this month demerged its non-technology operations including consumer care, lighting, furniture, infrastructure and medical businesses into a separate unlisted firm called Wipro Enterprises. Chairman Azim Premji said the company has no plans to list Wipro Enterprises.
"We have zero plans to list that company. If we wanted to list it, we could have done it at the time of the demerger. So, please for God's sake, don't build those expectations. We have no plans to list that company; absolutely no plans," said Premji.
Earning from the April-June quarter would now be released by Wipro as a standalone IT company. IT services contributed 87% of Wipro's revenues in 2012-13.