Information technology outsourcers Wipro and Satyam posted higher quarterly profits, but said the business outlook was cloudy due to slowing Western economies, sending their shares lower.Wipro Ltd, the country’s No 3 software services exporter, on Friday missed forecasts with a 15 per cent rise in quarterly profit, while its smaller rival, Satyam Computer Services Ltd, beat forecasts with a 45 per cent surge in earnings.But both firms were cautious about outsourcing prospects in the near term, as major US clients battle weakening economies. “The current situation hasn’t improved compared to last quarter, particularly in the financial services sector,” Wipro CFO Suresh Senapaty said.“Some of the US banks are in trouble, so the uncertainty has still not disappeared.” Wipro’s shares closed 3.8 per cent lower at Rs 365.55, after sinking as much as 6.5 per cent, while Satyam stock ended 7.5 per cent lower at Rs 382.95, after tumbling nearly 10 per cent. Other software stocks also fell.The main Mumbai index rose 4 per cent, while the sector index dropped 2.6 per cent. “The very cautious guidance is not helping. Sentiments have been hit and investors are dumping the stocks,” said Jayesh Shroff, fund manager at SBI Mutual Fund.Wipro Ltd, majority-owned by its billionaire chairman Azim Premji, forecast its IT services revenue this quarter would rise 2 per cent from April-June to $1.09 billion, less than a 3.5 per cent sequential rise in the June quarter.In the June quarter, Wipro received a quarter of its revenue from financial services companies. But the firm expects prospects to improve in the second half of the financial year ending in March 2009, as overseas clients look to cut costs and boost efficiency amidst slowing economies.Wipro was also confident of maintaining or improving margins for the full year, despite an “adverse impact” from wage hikes in the September quarter, thanks to improved pricing and a strong pipeline of orders, Senapaty said.The firm, which offers system integration, software application development and back-office services, said net profit rose to Rs 548 crore in its fiscal first quarter to June, from Rs 710 crore a year ago, under US accounting rules.Profit was hurt by a drop of Rs 2.72 crore in other income, as compared to a gain of Rs 9.91 crore a year ago. Revenue rose 42.5 per cent to Rs 5,962 crore, as it added 31 clients during the quarter.Error in forecast• Wipro, the country’s No 3 software services exporter, missed forecasts with a 15 per cent rise in quarterly profit• CFO Suresh Senapaty says situation hasn’t improved compared to last quarter, particularly in the financial services sector• Company expects prospects to improve in second half of the financial year ending March 2009, as overseas clients look to cut costs and boost efficiency
