Brisk Western outsourcing orders helped boost net profit at India's third largest software exporter, Wipro Ltd., by 25 percent to 5.32 billion rupees (US$118 million, euro97.72 million) in the October-December quarter, surpassing market expectations. The company said Wednesday its revenues grew 33 percent to 27.73 billion rupees (US$617 million, euro510.97 million) during the third quarter of the 2005-2006 fiscal year.
Outsourcing orders from Western companies contributed US$473 million (euro 391.72 million) to Wipro's revenues, while the rest came from outsourcing by Asian companies and Wipro's other businesses, the company said.
The stock market cheered the results, pushing Wipro's shares up to 461.15 rupees, or 2.7 percent more than the previous day's close, on the Bombay Stock Exchange.
"The results for the quarter signal the next phase in Wipro's growth," chairman Azim Premji said after announcing the financial results. "Apart from delivering solid revenue growth, we improved on our operating margin."
For the January-March quarter, Premji expected revenues to reach US$510 million.
These results conformed to U.S. accounting standards. Wipro, which is listed on the New York Stock Exchange as well as on India's two main exchanges, also published a slightly different set of results under Indian standards.
"These are very good results," said Ruchit Mehta, analyst with ASK-Raymond James Securities, based in Bombay, India's financial capital. "They saw positive growth both in volume and number of clients. They have managed their margins well, despite a rise in salary costs," he said.
Most stock analysysts expected net profit to be just more than 5 billion rupees (US$111 million, 91.93 million euros) and were pleasantly surprised, he said.
Wipro also said Wednesday that it added 61 clients during the third quarter its highest ever in a single quarter and hired added more than 5,000 employees to push its work force past the 50,000 mark.
India's software and back-office services industry, of which Wipro is a leading player, is expected to earn more than US$22 billion in export revenues for the fiscal year to end March 2006, reports the AP.