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Wipro guidance up for fourth quarter

Posted on Jan 17 2014 | IANS

Bangalore, Jan 17 : Wipro Ltd Friday gave an upward revenue guidance from its global IT services business for fourth quarter (January-March) of this fiscal (2013-14), buoyed by its robust performance in third quarter (October-December).

In regulatory filing to stock exchanges after markets closed for the day, the IT bellwether projected average revenue of USD 1,729 million (USD 1.73 billion) from IT services in the current quarter (Q4) of this fiscal (FY 2014).

"We expect revenue from our IT services business to be in the range of USD 1,712-1,745 million, including revenue from our recent acquisition for the quarter ending March 2014," the company said in the filing.

The global software major acquired the US-based leading mortgage firm Opus Dec 2 for USD 75 million (Rs.467 crore) to strengthen its outsourcing business in the financial services vertical.

Beating estimates, the company's de-merged IT business, including services increased 18 percent year-on-year (YoY) to USD 1.8 billion (Rs.11,332 crore), which is three percent up sequentially from second quarter (July-September).

As projected for third quarter, IT services business grew 6.4 percent YoY to USD 1.7 billion, with a sequential growth of 2.9 percent.

"As the global economy is progressing towards stability, we see optimism among clients, especially in the West. Corporations are leveraging technology to reduce operational costs and investing resources in differentiating themselves in the marketplace," Wipro chairman Azim Premji said in a statement here.

Earlier, the company reported net profit of Rs.2,015 crore for third quarter (Q3), posting 27 percent year-on-year (YoY) growth and four percent sequentially, as per the Indian accounting standard.

Under the International Financial Reporting Standard (IFRS), net income for the quarter was USD 325 million and revenue USD 1.8 billion, including USD 1.7 billion from its global IT services.

"Our focus on account management has yielded encouraging results. We continue to execute our strategy for superior engagement with clients while investing in emerging technologies to drive towards a higher growth trajectory," Wipro chief executive T.K. Kurien said in the statement.

The IT services business added 42 new clients during the quarter under review, including at least nine multi-million dollar contracts.

"Our strategy of standardization at the core is yielding results. Our investments in automation and productivity tools have driven efficiencies and helped us expand (operating) margin of IT services by 54 basis sequentially to 23 percent and from 20.8 percent year ago," chief financial officer Suresh Senapaty said.

With exit of 814 techies during the quarter, the total headcount declined sequentially to 146,402 from 147,216 though up 3,497 on annualised basis from 142,905 year ago.

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