Abidali Z. Neemuchwala speaks about Wipro’s Q4 earnings, the challenges the IT firm is facing amid the Covid-19 crisis, and how it is sailing through
Bengaluru: Abidali Z. Neemuchwala resigned as the chief executive and managing director of Wipro Ltd on 31 January but he is holding office until a successor is appointed, to ensure that business continues as usual. In a telephonic interview, Neemuchwala spoke about the company’s Q4 earnings, the challenges they are facing amid the Covid-19 crisis, and how they are sailing through. Edited excerpts:
What are some of the top challenges Wipro is currently facing?
One of the challenges we are facing these days is customers requesting for temporary discounts, deferment of certain projects, and cancellations or non-renewals. In digital, what typically happens is projects are renewed frequently. So this might not be happening. Then, customers are also asking for longer payment time so that they can conserve on their cash.
Which verticals do you see being impacted the most? Which are more resilient?
All the consumer facing verticals like aviation, travel & hospitality, retail, auto – all of them are seeing relatively higher impact. Also, because of the oil prices, the oil and gas vertical, particularly energy has been highly impacted. I think some of the verticals that are immune at least for now could be communications, given the need for bandwidth and people working from home right now. The utilities as well as consumer goods vertical, especially food and groceries, are few others which are doing relatively well as of now. But I do not know for how much longer they will continue to do well.
What is Wipro’s strategy to sail through the Covid-19 crisis?
The strategy is very simple. We have to stay close to our customers and we already have very good credibility with our customers. We have very high satisfaction among our customers and it is at an all-time high. Now, we did very well, enabling ‘work from home’ without disrupting customer’s business and built trust and credibility. And we have offerings in digital whether it is modernisation which involves moving to the cloud or automation, both robotic process automation and AI-based automation. We have the Topcoder platform for crowdsourcing and a strong cyber security offering for the ‘work from home’ environment today. So, our strategy is to be closer to the customers by taking these offerings to them and contextualise them to each customer’s environment. We need to be nimble on one hand to gain market share. On the other hand, we need to look at our own costs and be very sensible about our costs so that we are able to make certain adjustments with our customers and maintain the health of our balance sheet as we go through.
How do you see growth in the digital business in the current environment?
I think there will be pressure on digital because it is part of discretionary spend. The first thing that customers do in a crisis is to stop discretionary spend. After some time, they will of course have their strategy in place, and we do expect a lot of the customers increase their spending on digital as they want to accelerate in their digital transformation journey. But right now, we do see an impact, simply because clients are conserving cash and the key here to conserve cash in discretionary spend than in other areas. Digital contributed 41.2% to the company’s total revenues as of the fourth quarter ended March.
