Wipro cedes third slot to HCL

The Bengaluru-based IT major Wipro on Wednesday lost its third position to HCL Technologies in India's IT industry, as it reported 14% drop in net profit at Rs 1,886 crore for the second quarter ended September 2018.

The Bengaluru-based company had registered a net profit of Rs 2,189 crore in the year-ago period.

However, its gross revenue went up by 8% to Rs 14,541 crore during the second quarter compared with Rs 13,423 crore in the corresponding quarter last year.

Abidali Z Neemuchwala, CEO and Member of the Board said, “Wipro has delivered a strong quarter on both revenue and margin growth. We won our largest deal to date and four of our Business Units grew over 4% sequentially in constant currency terms. The demand environment is robust, especially for digital transformation and enterprise scale modernization services.”

The Board of Directors of the company at its meeting held on October 24, 2018, approved the appointment of former SBI Chairperson Arundhati Bhattacharya as an Additional Director in the capacity of Independent Director for a term of five years with effect from January 1, 2019, the company said in a separate filing with BSE.

On the other hand, the revenues of HCL jumped by 19.5% to Rs 14,860 crore, from Rs 12,433 crore in the same quarter last fiscal.

In the quarter ended June 30, 2018, Wipro had clocked a net profit Rs 2093.6 crore, while HCL had clocked Rs 2,403 crore.

In dollar terms, HCL has already taken over the third slot from Wipro during the first quarter of 2018-19, when it clocked revenues worth $2,054.5 million, ahead of Wipro's $2,042 million.

In the first quarter of the current financial year, Wipro's revenues stood at Rs 13,977.7 crore, while HCL's revenues stood at Rs 13,878 crore.

HCL has also widened the gap in terms of net profit in the second quarter, with now fourth-placed Wipro. HCL on Tuesday reported a net profit of Rs 2,540 crore for the second quarter ended September 30, 2018, up 16.1% compared with Rs 2,188 crore for the corresponding quarter last year.

Wipro added one more client in the $100-million club during the quarter.

The company's IT services revenue stood at $2,041.2 million during the quarter, with a sequential growth of 1.9%.

The revenue growth at HCL is primarily driven by strength in the segments of people and services and integrated facilities management.

The meagre growth of Wipro comes despite the fact that the company witnessed 60% of its revenue coming in US dollars, which has strengthened off late.

Among the geographies, the Americas contributed the highest of 55.2% to the company's revenues.

Wipro added a total of 10,687 people to its headcount, taking the total to 1,75,346 people, with voluntary attrition rate rising to 17.4%. The gross utilisation came down to 74.4% during the quarter.

The stock ended flat at Rs 309.25 per share on BSE.