Like its rivals Infosys Ltd (INFY.NS) and Tata Consultancy Services Ltd (TCS.NS), Wipro is banking on a revival in demand for IT services from the industry's biggest markets as the economies of the United States and Europe improve. (Agencies)
"As the global economy is progressing towards stability, we see optimism amongst clients, especially in the West," Chairman Azim Premji said, after Wipro reported a slightly higher-than-expected net profit for the December quarter.
India's USD108 billion outsourcing sector generates more than 90 percent of its sales from providing services, including setting up IT networks and developing software applications, for overseas clients.
Banks and insurers like Citigroup (C.N), Bank of America Corp (BAC.N) and British insurance group Aviva (AV.L) are among the biggest spenders on technology services, ranking among the top clients for Indian IT oursourcing firms.
The company, owned by billionaire Premji, generated about 26 percent of its sales from its financial clients in the December quarter, lagging the nearly 34 percent notched by Infosys and 43 percent at Tata Consultancy.
Wipro, which has been trying to grow its share of revenues from financial clients, said sales at its financial solutions business grew about 3 percent over the previous quarter, faster than 0.5 percent rise at TCS and a 2 percent growth at Infosys.
Last month, Wipro agreed to buy a US-based mortgage services provider to boost its offerings for financial services clients.
Wipro expects to add new clients and is looking for acquisition opportunities in the financial sector to boost growth, its Chief Executive TK Kurien told reporters.
"BFSI (Banking, financial services and insurance) is a large piece for everybody and that's where the bulk of the IT services spends are and you need that to really drive growth and meet industry growth. So they are in the right direction," said Nitin Padmanabhan, an analyst with Espirito Santo brokerage.
Like its rivals Infosys Ltd (INFY.NS) and Tata Consultancy Services Ltd (TCS.NS), Wipro is banking on a revival in demand for IT services from the industry's biggest markets as the economies of the United States and Europe improve.