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Wipro Posts 8 Percent Rise in Quarterly Profit

Wipro Posts 8 Percent Rise in Quarterly Profit

By Reuters | Updated: 22 October 2014 18:55 IST

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India's third-biggest software services firm Wipro Ltd narrowly missed market expectations with an eight percent rise in second-quarter profit, but said it saw a rosier end to the year as more confident U.S. clients increase spending.

For the quarter ended September 30, Bangalore-based Wipro posted consolidated net profit of Rs. 2,085 crores ($340.4 million). Analysts, on average, were expecting Wipro to make Rs. 2,109 crores rupees, according to Thomson Reuters I/B/E/S.

Total revenue rose to Rs. 11,816 crores from Rs. 10,991 crores in the same period last year.

"Overall the demand environment continues to hold steady. In North America we see discretionary spend returning," Chief Executive TK Kurien said.

He added the group saw opportunities in continental Europe, where outsourcing has yet to expand to U.S. levels.

Kurien was picked to lead the company more than three years ago by founder chairman Azim Premji, after Premji sacked joint CEOs Suresh Vaswani and Girish Paranjpe.

Wipro, however, has struggled to catch up with rivals like Tata Consultancy Services and Cognizant Technology. Peer Infosys has itself been hit by management changes over the last couple of years, but has reassured investors with a new chief executive.

On Wednesday, Wipro said it expects "headwinds" in some of the company's key accounts to continue till December this year.

"Infosys has now laid out their plans, so we know what the idea is. Wipro has talked about plans for some time, but it does not show on results," Ankita Somani, analyst with MSFL Research said.

Wipro said it expects revenues from its IT services business to be in the range of $ 1,808 million to $ 1,842 million in the current quarter. For thee quarter ended Sept., the unit saw revenues of s $1,771.5 million.

Shares in Wipro closed ahead of the results at 583.65 rupees on Wednesday in the Mumbai market.

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