CFO exit set to hit Wipro’s turnaround

Expensive Departure For IT Major

♦ Jatin Dalal knew the company’s in and out

♦ Conducted several buybacks & big-ticket acquisitions

♦ Several senior level exits happened in Wipro including COO and senior V-Ps

♦ It came at a time when the company is trying hard to improve performance

Wipro’s Chief Financial Officer JatinDalal’s exit adds to the disquiet among the top management in the Bengaluru-headquartered IT company, which has already seen several senior level exits in the last 10 months.

Sources in the know said Wipro’s efforts for turnaround may face a setback owing to Dalal’s exit who has been an old hand with intricate understanding of company’s functioning.

“Jatin (Dalal) has been leading the finance department since 2015 and has seen many CEO transitions. Under his leadership, Wipro has conducted many buybacks apart from certain big ticket acquisition. No doubt, his exit doesn’t augur well for Wipro at a time the company is trying hard to accelerate growth,” said a Mumbai-based analyst.

JatinDalal’s departure comes after a series of exits at Wipro, including Chief Operations Officer Sanjeev Singh and several senior vice presidents. Such senior level exits casts shadow over the ability of the top management to retain senior talent.

“Quite a few senior management personnel have quit Wipro in the past 9-12 months. Jatin’s exit adds to the list. Some of the changes may have been necessary to check underperformance. However, the loss of key leaders continued into the fourth year of turnaround will not be viewed favourably,” notes Kotak Institutional Equities in a note.

Wipro, despite some improvement in growth in FY23, has been lagging its peers in terms of revenue growth rate and operating margin. During the first quarter of current financial year, Wipro’s revenue dipped by 2.8 per cent in constant currency terms. Its outlook for the quarter ahead too remained soft.

In the last three months, while TCS, Infosys and HCL Tech have bagged several large deals, big deal wins by Wipro remained low despite being a large IT services player.

“Wipro is struggling in its turnaround effort, has a weak mega deal pipeline and is vulnerable to vendor consolidation. We expect the company to underperform peers on growth in FY2024E and in the medium term,” Kotak added in the note.

Wipro’s share price dropped 2.5 per cent on Friday as market reacted negatively towards the news of exit.

Meanwhile, the company appointed AparnaIyer, a Wipro veteran with stellar credentials as the new CFO of the company.

Iyer joined Wipro in April 2003. Over her 20 years with Wipro, she has held several finance roles, including Internal Audit, Business Finance, Finance Planning and Analysis, Corporate Treasury and Investor Relations, and, most recently, senior vice-president and CFO of Wipro FullStride Cloud.