For Wipro to gain the market share it had lost over the years, aggressive inorganic push, through acquisitions, is important, especially at the time of rapid growth in technology, said CEO & MD, Thierry Delaporte.
Under Delaporate, since July 2020, Wipro made close to 10 acquisitions to the tune of over $2.5 billion, including the largest-ever acquisition of Capco for $1.45 billion. According to Delaporte, this will continue.
“I think we are in a market where there's a lot of demand, there is a lot of growth and we must be in the market. Grabbing market share must be an obsession,” he told Moneycontrol.
Over the last few years, the Bengaluru-based IT major had lost market share to its peers. Back in 2018, HCL Tech slipped past Wipro to become the third-largest IT services provider in the Indian IT services firms’ pecking order.
However over the last 1.5 years, things have changed for Wipro. The company reported six straight quarters of revenue growth over 3 percent for the quarter ended March 2022.
The firm reported $10.4 billion in revenue for the year ending March 31, 2022, up 27.3 percent compared to FY21. The management expects to close FY23 with double digit growth.
Market share, acquisitions
Delaporte explained: “For many years, Wipro has lost market share. So it is time for us to really regain part of what we've lost and more. So I'm convinced that we need to continue to go and grab market share.”
This means that, Wipro needs to have aggressive organic push, but also inorganic. “If we decide to build, it would take years, and the market will not wait for us. We are in a market where technology is evolving rapidly. But the understanding of the business of our clients is critical. You cannot only sell technology; you need to understand the business challenges of our client to understand how to leverage technology to provide solutions to them,” he said.
So the company will continue to acquire companies but only when it makes sense from a strategy standpoint. “We do not have a number in mind. Rishad Premji, chairman, and I are incredibly aligned on everything. But on that strategy, it is very clear for us that, it is not that we need to hit a particular amount of inorganic. But we will look at what makes sense. And when it does, we are considering it,” Delaporte added.
Consulting is another key area of focus for the company, and Capco acquisition was expected to give this area a boost. “Capco is an absolute success. The recipe (for success) is you need to make sure that you are not merging this consulting business with the technology business. Those are different families, but who are working for the same accounts. And so the alignment is around the client. It's not by merging them,” he added.
Currently, consulting is a significant practice for the firm globally. However he did not share the specifics on the same.
Talent acquisition is another area of focus. The company hired 19,000 freshers in FY22, and will double this number in FY23.