Delaporte focuses on Europe to revive Wipro2 min read . Updated: 19 Jan 2021, 10:33 PM IST
- As part of the new strategy, the CEO also plans to push M&As in Europe
- Europe is the second-largest market for Wipro, contributing 25.2% of its total revenue
BENGALURU : When Thierry Delaporte took charge as the chief executive officer and managing director of Wipro Ltd last July, his mandate was to bring the IT firm, which lagged its peers for several years, back to growth.
His predecessor, Abidali Neemuchwala, had failed to deliver on his ambitious target of turning Wipro into a $15-billion firm with operating margin of 23% by 2020. In FY20, the company’s revenue was a little over $8 billion, and operating margin stood at 18.1%. In fact, HCL Technologies Ltd beat Wipro to become India’s third-largest software exporter in FY19.
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In the past six months, Delaporte has kept a laser-sharp focus on execution. Effective 1 January, Wipro replaced its existing structure of 26 strategic business units, service lines and geographies, with just four strategic market units and two global business lines.
As part of the strategy, Delaporte is focusing on Europe, the second-largest market for Wipro, contributing 25.2% to its total revenue. As part of the new structure, Europe is structured into six regions —the UK and Ireland, Germany, Benelux, Nordics, Switzerland, and Southern Europe.
“In each of these regions, we invested in talent…we have appointed new heads for these countries, both internally and externally. And we have structured specific strategies for each of these countries," Delaporte said in a virtual interview. “In Europe, it’s important to combine global expertise and local connects. So, while it’s a journey, we have already started to invest in local expertise."
Wipro is also looking to accelerate the pace of mergers and acquisitions (M&As) in Europe. “We have defined our roadmap for the next few years in terms of acquisitions in Europe and I think we will be more and more visible in this market."
Wipro will focus on priority sectors. “In each of our chosen market in Europe, we have identified two to three sectors of priority. BFSI (banking, financial services and insurance) is a strategic sector for us in Europe as it is in Asia and America," Delaporte added. BFSI was the largest vertical for Wipro growing 1.2% sequentially in constant currency and contributed 30.5% to its revenue for the December quarter.
Delaporte’s entry has augured well for the company so far. The stock price has more than doubled from the ₹220 levels in early July 2020 to a 52-week high of ₹467.20 on 13 January.
“The buzz around Wipro is not just due to its superior quarterly results, but also because of the larger transformation journey that Delaporte is architecting. His key priority is to drive growth agenda with much higher intensity. He has also created a large deals-team that will focus on winning transformational engagements and increasing Wipro’s market share in Europe," said Nitin Bhatt, technology sector leader, EY India.
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