Wipro jumps on solid result, upbeat outlook

By agencies   |   Friday, 22 April 2005, 07:00 Hrs
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BANGALORE : Wipro Ltd., India's third-largest software services exporter, reported on Friday its quarterly net profit rose an expected 38 percent and gave an upbeat forecast as clients ramped up tech outsourcing.

Bangalore-based Wipro, which makes software for microchips and telecom equipment, forecast its IT services revenue would rise 5 percent to $395 million in its fiscal first-quarter to June, compared with $375 million in the March quarter.

The forecast cheered the stock market, which was rocked just over a week ago when bigger rival Infosys Technologies Ltd. said it expected flat first-quarter revenue.

Wipro's shares rose as much as 8 percent to 653.9 rupees in early trade, boosted in part by a surprise one-for-one bonus share issue, barely a year after the previous bonus. The stock was the biggest gainer on the broader market, which rose 0.7 percent.

"The guidance is positive. Strong employee and client additions signal good times ahead," said Pratish Krishnan, an industry analyst with SBI Capital Markets.

New York-listed Wipro consolidated net profit in the fiscal fourth quarter rose to 4.47 billion rupees ($102 million ) from 3.25 billion a year earlier, in line with 4.48 billion rupees projected in a Reuters poll of 11 analysts. Revenue grew 30 percent to 22.96 billion rupees.

"Wipro and Satyam results have revived hopes that the tech sector is in good shape," said New Delhi-based K.K. Mittal, a fund manager with Escorts Mutual Fund. Satyam Computer Services Ltd., India's No. 4 software firm, cheered markets on Thursday with upbeat results, raising expectations for Wipro.

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