Wipro's revenues fell 7.5 percent sequentially during the June quarter, but the company recorded a strong operating margin of 19 percent despite disruption from the COVID Pandemic. The company is hoping to hold its margins in a narrow band for the next few quarters as well.
The IT major again refrained from giving guidance on revenue and margins due to the uncertainty around the pandemic.
Wipro also brought on board Thierry Delaporte as its new CEO , in place of Abid Neemuchwala.
"I tend to be optimistic but also cautious about the crisis. This is not the right time for us to resume guidance," Delaporte told CNBC TV 18, even as Tata Consultancy Services said last week that the COVID impact may have bottomed out in Q1. Mindtree, which disclosed earnings on Tuesday as well, also said that it expects Q2 to be better than Q1.
During the press conference, Delaporte said that "profitable growth" was the "most important agenda."
" I expect to finalize a plan to reach industry-leading growth," he added.
Margins likely to be in narrow band
"We believe we would like to hold this margin in a narrow band," said CFO Jatin Dalal.
The company saw a significant contraction in several verticals such as Consumer Business Unit, which shrunk 12.3 percent in terms of revenue, Communication declined by 14.7 percent, and BFSI contracted 6.6 percent.
COO Bhanu Murthy said the company expects to see an uptick in communications, manufacturing, and health, but expects BFSI, Energy , Natural Resources and Utilities(ENU) to be flat.
"The deal momentum has picked up, and the pipeline is looking good. Our order book has improved Y-o-Y, but the deal velocity is not at pre-COVID levels," Murthy said.
Wipro has been undertaking share buybacks for the last few years, and while the management said there are no deliberations currently, it clarified that there also no change to the buyback policy.
"Our dividend policy is 45-50 percent of our net income every year. We are not changing the policy," Dalal said.
"The earliest we can consider a buyback is in September. It is not something that is part of deliberations right now. We will need cash for strategic purposes," he added.