Vibhor Singhal

Vibhor Singhal from Nuvama Equities asked about the outlook for the consumer vertical, noting its steeper decline and year-on-year contraction, and whether it is expected to turn around soon given tariff uncertainties. He also inquired about the strong performance in the Tech and Healthcare verticals, seeking details on specific project ramp-ups and sustainability of growth.

Answer

Saurabh Govil, CHRO, explained that the consumer sector's performance was impacted by tariffs and a delayed large SAP program, with a mixed outlook despite some ramping wins. Aparna Iyer, CFO, attributed strong healthcare performance to consistent growth and seasonal open enrollment, while Tech and Communications benefited from large technology clients, the Harman acquisition, and improved performance in Europe and APMEA.

Vibhor Singhal inquired about the outlook for the consumer vertical, noting its steeper decline and continued year-on-year decrease, asking if a turnaround is expected soon. He also asked about specific project ramp-ups driving growth in the Tech and Healthcare verticals and their sustainability.

Answer

Saurabh Govil (CHRO, Wipro) explained that the consumer sector's performance was impacted by tariffs and a large SAP program put on hold last year, which has not yet reinitiated. He noted a mixed trend, with earlier wins slowly ramping up to support growth, and Q4 forecasts reflecting current growth. Aparna Iyer (CFO, Wipro) stated that healthcare has shown consistent performance, benefiting seasonally from the open enrollment season in Q3. She added that Tech and Communications have performed well with large technology players, partly due to the Harman acquisition, and communications generally improved in Europe and APMEA.

Vibhor Singhal sought an outlook for the BFSI sector over the next 2-3 quarters, considering Capco's performance, the Phoenix deal ramp-up, and past challenges in Europe BFSI. He also asked about the healthcare sector's trajectory given structural changes and policy impacts, and the headcount addition outlook for the coming quarters.

Answer

Srinivas Pallia, CEO and MD of Wipro, detailed BFSI's 2% sequential growth, led by Europe and APMEA, with robust order bookings and strong pipeline. He noted Capco's sequential and year-on-year growth and confirmed the Phoenix deal's execution from Q3, maintaining a positive outlook for BFSI. For healthcare, despite structural changes and headwinds, Mr. Pallia highlighted a mega deal win, client adaptation driving cost takeouts and modernization, and opportunities in real-time claim processing and pre-authorization. He indicated that headcount would continue to increase based on strong H1 bookings and conversion to revenue, with net headcount, fresher onboarding, and utilization all up in Q2.

Vibhor Singhal from Nuvama Equities asked for an outlook on the BFSI sector for the next 2-3 quarters, considering CapCo's performance, the Phoenix Group deal ramp-up, and past challenges in Europe. He also sought insights into the healthcare sector's trajectory, given structural changes and policy impacts. Finally, he inquired about the headcount addition outlook for the coming quarters, in light of deal ramp-ups.

Answer

Srini Pallia, CEO and MD, Wipro, detailed BFSI's 2% sequential growth, driven by Europe and Appmea, with robust order bookings and CapCo's strong performance. He expressed a positive outlook for BFSI, noting the Phoenix Group deal's Q3 ramp-up. For healthcare, Mr. Pallia acknowledged structural changes and policy impacts but highlighted it as a strong sector with a recent mega deal, and opportunities in cost takeouts, modernization, and AI-driven efficiencies. Regarding headcount, he stated that Wipro would continue hiring laterally and from campus based on demand and revenue conversion, following recent increases in net headcount, fresher onboarding, and improved utilization.

Vibhor Singhal from Nuvama group asked about the drivers behind Capco's solid growth in a challenging environment and whether its momentum and pipeline remain strong. He also re-inquired about the margin outlook and the potential to exceed the previously mentioned 17-18% range.

Answer

CEO & MD Srini Pallia attributed Capco's growth to strong performance in the U.S. and APMEA, particularly across insurance, wealth management, and energy sectors, as well as expansion in Latin America. CFO Aparna Iyer confirmed Capco's pipeline continues to look good. On margins, she reiterated that while Q1 was in the 17-17.5% aspirational band, the number one priority is now growth, which will require investments in ramping up large deals, potentially creating margin pressures.

Vibhor Singhal asked if macro weakness impacted Q4 results, questioned the potential for positive growth in FY'26, and inquired about margin risks from weak growth versus potential upside from a recovery.

Answer

CEO Srinivas Pallia confirmed that a deteriorating macro environment impacted Q4 results but declined to give FY'26 guidance, pointing to the Q1 guidance as the best current visibility. CFO Aparna Iyer stated the goal is to maintain margins in a 'narrow band,' citing headwinds from weak revenue and pricing pressure on cost-takeout deals. She noted levers like managing bench costs and G&A optimization would be used to defend profitability.

Vibhor Singhal from Nuvama Equities asked about the immediate impact of the H1B visa hike on client uncertainty and deal progression, as well as the long-term implications for Infosys's business model, specifically if it could lead to higher offshoring or nearshoring as an unintended benefit. He further questioned client acceptance of such shifts and the potential for margin improvement.

Answer

CEO Salil Parekh stated no short-term impact from the visa hike. He outlined a long-term model involving increased localization, nearshoring, and offshoring, emphasizing joint client collaboration to adapt delivery. CDO Satish HC highlighted Infosys's historical agility in adapting delivery models, citing the post-COVID shift. Mr. Parekh and Mr. HC acknowledged that mathematically, more nearshoring and offshoring *could* lead to margin improvement, but it depends on the balance with local hiring.

Vibhor Singhal of Nuvama Institutional Equities asked if a resolution to tariff uncertainties could quickly restart client spending. He also inquired if the current AI cycle is analogous to the digital adoption cycle of 2015-16 in terms of its potential industry impact.

Answer

CEO Salil Parekh stated that while clients are keen to leverage enterprise AI, the company's outlook is based on the current environment, and they will update it quarterly as conditions evolve. He viewed the current AI shift as distinct from past tech cycles but noted Infosys is well-prepared to capitalize on the tremendous client interest and foundational needs like cloud and data.

Vibhor Singhal from Nuvama Institutional Equities inquired if the growth trajectory in FY'26 might be less first-half heavy due to macro uncertainty in Q1, and asked if there were still benefits to be realized from Project Maximus.

Answer

CFO Jayesh Sanghrajka stated that while regular seasonality is expected, macro uncertainty makes the quarterly growth trajectory unpredictable, and declined to give quarterly guidance. He affirmed that Project Maximus continues to have opportunities to deliver value through tracks like value-based selling and lean automation, giving management confidence in their ability to improve margins from current levels.

Vibhor Singhal asked for an outlook on the BFSI vertical regarding discretionary spending, questioned if the softer TCV this quarter was due to deal pushouts, and sought the rationale for delaying wage hikes.

Answer

CEO Salil Parekh confirmed that discretionary spending in Financial Services remains strong, particularly in capital markets, mortgages, and payments, though large transformation programs are not yet prevalent. He characterized the quarterly TCV as naturally lumpy and not indicative of a change in client behavior. CFO Jayesh Sanghrajka explained the timing of wage hikes considers the demand environment, market practices, and the anniversary of the last increase, also noting the recent increase in variable pay.