Wipro profit flat on wage hike

Bangalore: IT major Wipro's IT services revenue in the quarter ended September 2011 stood at Rs 6,829 crore, a 7% increase sequentially and a 19% growth over the previous year. In dollar terms, the company bettered its guided revenue figure of $1,436-1,464 million for the quarter by posting revenue of $1,472 million.      However the company continues to lag its peers. Infosys's revenue in the quarter grew 8.2% sequentially, TCS's by 7.7% and HCL Tech's by 8.2%.      Wipro chairman Azim Premji said that the business environment for IT services still remains robust. He said he was part of a CEO meet in Atlanta, US, recently, where the sentiment was positive. "The cash flow positions of companies are strong. There is no gloom and doom, the reality is that corporates are willing to spend money. Companies are still looking to invest in IT in key strategic areas of differentiation," he said.      Wipro's net profit stood at Rs 1,301 crore, up 1% over the previous quarter and flat compared to the previous year. Wipro CFO Suresh Senapaty said this was mainly due to annual wage hikes and costs associated with the acquisition of the SAIC unit. The operating margin fell to 20% from 22% in the previous quarter.      The Wipro stock was up 3.2% after the results were announced but gave up the gains to close 1.7% down at Rs 366 at the BSE on Monday. The sensex closed 0.56% down.      Ankur Rudra, IT sector analyst at Ambit Capital, said the results were positive but it was too early to say if the company's restructuring efforts are yielding full results. "Apart from the financial services vertical which grew 6.3% sequentially and energy and utility at 22.9%, other key verticals remained tepid," he added. Azim Premji