India's Wipro benefits from recovery in offshoring
Wipro's IT services business grew by 4.8% year-on-year in the fourth quarter
IDG News Service - Wipro's fourth-quarter IT services revenue grew 4.8% year on year, reflecting an overall recovery in offshoring to India.
The Indian outsourcer said Friday revenue from IT services in the quarter was $1.58 billion, as its customers "leverage technology to drive revenues and productivity."
The company has forecast that revenue from IT services could reach $1.6 billion in the current quarter.
IT services accounted for 78% of the total revenue of the company, which also has other businesses such as in consumer care and lighting.
Revenue growth in the IT services business was higher in rupees at 13% year on year, because of the depreciation of the Indian rupee against the dollar.
The IT Services business had 142,905 employees, after an increase of 2,336 staff in the quarter. It added 50 new customers in the quarter.
Wipro decided in November to move its non-IT businesses out of the company to give it a higher focus on IT services. The plan is expected to come into effect from its next fiscal year, starting April 1.
The company's Indian competitors, including Tata Consultancy Services, the largest outsourcer in the country, and Infosys, the second-largest, have also reported good results in the wake of an improved outlook for offshore outsourcers.
Revenue at TCS increased by 14% year on year to nearly $3 billion, while net profit of $652 million was up 14.8% from a year earlier.
The offshore market for outsourced services is expected to grow by 12 to 15% this year, as more customers are expected to increase IT spending, said Sudin Apte, principal analyst and CEO of Offshore Insights.
Wipro's overall revenue grew in rupees by 10%, while net profit grew 18%. The company does not break out net profit for its IT services business.
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