Wipro on Friday revised upwards its IT services revenue outlook to 8-10 per cent sequential growth in the June 2021 quarter. This comes after the completion of its
$1.45-billion buyout of Capco.
Earlier this month, while announcing the results for the March quarter of 2021, Wipro had said that it expects to clock a sequential growth of 2-4 per cent in its IT services revenues in the June quarter. However, this did not include revenues from the Capco and Ampion acquisitions.
In March, the Bangalore-based firm had announced the acquisition of Capco in a $1.45-billion deal.
In a communication to the bourses on Friday, the company said the Capco acquisition was completed on April 29, 2021. Therefore, it has now decided to include revenues from Capco, thereby leading to the upward revision in revenue guidance for the June quarter.
“We expect revenue from our IT services business to be in the range of $2,324-2,367 million,” Wipro said.
The company added that this updated forecast does not include revenues from the Ampion acquisition. Wipro is set to acquire Ampion, an Australia-based provider of cybersecurity and engineering services, for $117 million. This deal is expected to close this quarter.
Wipro had posted revenues of $2,152.4 million in its IT services business in the fourth quarter of 2020-21.
Though Wipro has lagged behind its peers such as TCS and Infosys, analysts remain cautiously optimistic about its prospects. “A simplified operating model, leadership augmentation and Capco acquisition show Wipro’s growth aspiration and its resolve to take big bets. However, tangible results hinge on strong execution. Considering a poor execution track record, we prefer to wait for clear signs of improvement in operating metrics,’’ analysts at Emkay have said in a note.