Wipro showcases best Q4 results in a decade and eyes double digit growth next year
- According to
Wipro CEOThierry Delaporte, this was the company's best fourth quarter in the last 10 years.
- He believes that Wipro's revenue may grow from anywhere between 11% to 13% in the coming twelve months.
- The company has issued a guidance of between 2% to 4% for the first quarter of FY22.
- Meanwhile, the IT giant also expects its operating margin to slide further with the Capco integration to between 19% to 19.2%.
However, for the whole year, Wipro’s revenue only grew by 3% in the past 12 months, ending in March. Regardless, Delaporte believes the ramp of new deals and the demand for outsourcing will help the company deliver double digit growth in the coming financial year.
“We’re guiding revenue growth of 2% to 4% in the first quarter, outside of Capco and Ampion,” Delaporte said during the earnings call. Revenue from IT services is expected to be around $2.2 billion in the June quarter.
“The percentage translates into a year-on-year double digit growth of 11% to 13%," he added. That is a nearly ten-fold increase, and doesn’t include the impact of two of the company’s biggest deals in the past year.
The company’s operating margin dropped this quarter from 21% to 20.3%, and is expected to be lower in the coming year.
“20.3% is a number for FY21 with the realities of FY21,” explained chief financial officer (CFO) Jatin Dala. “FY22, we all have to appreciate, is a very different year. It is not going to be the same Wipro. It is going to be a much larger company after the Capco integration.”
He expects the operating margin to be between 19% to 19.2% with COVID-19 normalising in the future and Capco’s balance sheets become a part of Wipro’s books — the largest ever acquisition done by the company.
The IT giant closed 12 large deals resulting in a total contract value of $1.4 billion in the fourth quarter. According to the CEO, Wipro is still on the hunt for more deals.
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