Wipro Executive Chairman Rishad Premji believes the IT sector is recession proof, but that doesn’t stop him from betting big on hyper-scaler partnerships, inorganic growth through acquisitions and of cloud initiatives as the main mantra to ensure growth in the years to come.
In a letter to stakeholders that is part of Wipro’s FY22 Annual Report, Rishad Premji said, “We are much more growth-obsessed than before, and are driving deep strategic partnerships with hyperscalers and focusing more on large transactions.
Recession protection works
In terms of why he thinks the IT industry is recession proof, Premji thinks customers would either spend on business transformation or cost reduction. He is quite confident that would be the case, given that Wipro customers have not stopped or slowed decision-making on transactions and spending despite fears of inflation and recession.
He made the observations at the company’s 76th annual general meeting on Tuesday and said that while business transformation initiatives aimed at improving the customer experience start when things are going well, cost reductions become the mantra when things are not going so well. He was at pains to emphasize that customers make decisions, unlike the time in 2008 when the global financial crisis hampered decision-making processes.
The cloud is at the heart of Wipro
The Executive Chairman further wrote that cloud is at the heart of Wipro’s transformation initiatives with significant room for growth. “We are investing $1 billion in Wipro FullStride Cloud Services over the next few years to deliver orchestrated transformation to accelerate customer business outcomes,” he said.
Wipro FullStride Cloud Services is a collaboration between Wipro’s Chief Growth Office and existing global lines of business to create an integrated and comprehensive cloud transformation capability for customers, partners and cloud experts.
Meanwhile, Thierry Delaporte, who has taken over as chief executive, said Wipro’s order pipeline has strong prospects with the addition of 45,000 employees reflecting this. “We expect technology investments to increase in the coming years as companies continue to turn to cloud-based technologies and digital tools to enable an increasingly dispersed global workforce” , Delaporte said in the letter.
India’s IT services sector has come under pressure in recent weeks, with analysts seeing a sharp decline in revenue growth to 12-13% in FY23 from 19% a year ago. . Ratings agency CRISIL believes the drop is the result of squeezing IT spending amid inflationary headwinds in the United States and Europe.