India's Wipro Q4 profit up 7.7% but forecast muted

Apr 25, 2012 by Gulab Chand

India's third-largest software company Wipro on Wednesday posted a 7.7 percent year-on-year rise in net profit for the January-March period, but gave a muted forecast that sent its shares tumbling.

Consolidated net profit for the fourth quarter was 14.81 billion rupees ($284 million) compared with 13.75 billion rupees in the same period last year, the company said in a statement to the Bombay Stock Exchange.

Total revenue in the quarter increased 19 percent year-on-year to 98.69 billion rupees, it added, based on international accounting norms.

Wipro's earnings just beat analysts' estimates of a net profit of 14.76 billion rupees, according to an average earnings forecast polled by Dow Jones Newswires.

But the company forecast little growth for its revenues from IT services in the next quarter ending June, at between $1.52 billion and $1.55 billion, due to an uncertain global business environment.

The revenue outlook hit Wipro shares, which slid as much as 8.22 percent to a day's low of 406 rupees after the earnings. Shares closed at 410.15 rupees, down 7.29 percent.

"The overall macro-economic environment is volatile and customers continue to be cautious," Wipro chairman Azim Premji told reporters at the company's Bangalore headquarters.

The company's results come after Infosys, India's second-biggest outsourcer, disappointed investors by warning of a tough year ahead due to the global financial climate and growing anti-outsourcing sentiment in the United States.

However sector leader TCS, part of the Tata conglomerate, this week posted a 23 percent rise in quarterly profit and was upbeat on its outlook.

India's flagship outsourcing sector derives half of its revenues from the United States and is engaged in an increasingly fierce struggle for business with global rivals such as IBM and Accenture.

Wipro is a pioneer in India's software and outsourcing industry, which has benefited from work farmed out by global companies seeking to cut costs by taking advantage of India's lower wages and engineering talent.

Wipro added 41 new clients in the quarter, and on Wednesday the firm announced a partnership with the National University of Singapore for a multi-million-dollar IT infrastructure services deal.

The outsourcer also won a multi-year contract with a leading communication service provider in North America for technical support services, it said, without giving details.

Explore further: Sony's quarterly loss balloons on mobile woes

add to favorites email to friend print save as pdf

Related Stories

India's Wipro quarterly profits, revenue outlook up

Jan 20, 2012

Wipro, India's third-largest software exporter, reported Friday a 10.3 percent rise in quarterly profit but said the global outlook remained uncertain for the nation's flagship outsourcing sector.

India's Wipro positive despite global uncertainty

Oct 31, 2011

Indian IT outsourcing giant Wipro on Monday projected a positive outlook for the industry, despite gathering clouds over the global economy, as it announced a rise in quarterly profits.

India's Wipro points to weak revenue growth

Apr 27, 2011

Indian software giant Wipro on Wednesday forecast sluggish growth for the coming quarter in its flagship IT services division due to rising costs, as it showed slower-than-expected earnings data.

Wipro posts 9.7 percent profit rise, below forecast

Oct 22, 2010

India's third-biggest software firm Wipro reported Friday a lower-than-forecast 9.7 percent rise in quarterly net profit, blaming a higher rupee and wage costs for the disappointing earnings.

Recommended for you

Sony's quarterly loss balloons on mobile woes

11 hours ago

Sony's losses ballooned to 136 billion yen ($1.2 billion) last quarter as the Japanese electronics and entertainment company's troubled mobile phone division reported huge red ink.

Will Apple Pay be mobile pay's kick-start?

19 hours ago

If anyone can get us to use our smartphones as wallets, it's Apple. That's what experts think about the recent launch of Apple Pay, the first mobile wallet to work on an iPhone.

Google execs discuss regulation, innovation and bobble-heads

21 hours ago

Eric Schmidt and Jonathan Rosenberg help run Google, one of the world's best-known, most successful - and most controversial - companies. They've just published a new book, "How Google Works," a guide to managing what they ...

LinkedIn reports 3Q loss but sales climb

22 hours ago

LinkedIn Corp. posted a third-quarter loss on Thursday, but its results were better than expected as revenue grew sharply, sending shares of the online professional networking service higher in extended trading.

User comments : 0

Please sign in to add a comment. Registration is free, and takes less than a minute. Read more

Click here to reset your password.
Sign in to get notified via email when new comments are made.