Contrary to the cautious note being struck in the earnings of IT companies so far, Wipro was upbeat about its prospects, stating that there is no slowdown in spending, all markets are growing, order bookings are strong and the deal pipeline is robust.
“Despite the uncertainties of the macroeconomic environment, if I look at our pipeline, our order booking, and the discussion we are having with our customers, there has been no slowdown or pullback of spends for us. The demand for IT services is robust,” CEO Thierry Delaporte said, addressing the press after the company announced its earnings for the Q1FY23.
“It’s always difficult to predict what’s going to happen in 12 months, but in the next 2.5 months, we have pretty good visibility,” he added.
A potential impact on IT spends has been a cause for concern amid looming fears of a recession, with a greater impact expected in Europe than in the US, exacerbated by the war.
Here too, Delaporte said that the outlook for Europe in Q2 is very strong.
“All markets grew double-digit. Americas and Europe — our top two markets — grew at 18 percent and 16 percent for the quarter year-on-year in constant currency terms,” he said.
The company’s large deal booking came in at $1.1 billion, up nearly three times from Q4 when it was $400 million, and that in the last two years, the $100mn-plus clients have doubled from 10 to 20. Delaporte said that the company’s TCV grew at 30 percent quarter-on-quarter.
The company guided for revenue growth of 3-5 percent sequentially and said that with the guidance for Q2, Wipro will "comfortably grow" in double digits for FY23.
Chairman Rishad Premji, too, at the company’s Annual General Meeting on July 19, said that the technology services industry, at some level, is “recession-proof”.
“In good times, clients spend on new initiatives and business transformation and serving customers digitally. They focus on reducing costs when times are not so good,” he said.
Premji had said that despite elements of uncertainty in the short term, long-term prospects for the technology services industry look very good, and the company is “growth-obsessed”.
TCS CEO Rajesh Gopinathan, too, had said that the company is vigilant due to macro-level uncertainties despite pipeline velocity and deal closures remaining strong.
Mindtree CEO Debashis Chatterjee had stated that there were instances of some clients who had been impacted due to their exposure to Ukraine and Russia deferring opportunities.
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