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Sunday, July 23, 2017

The worst is over for Wipro: Abidali Neemuchwala

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Abidali Neemuchwala, since taking over as chief executive officer of Wipro Ltd on 1 February last year, has completed five full quarters. Wipro has done well only in one quarter—the January-March period this year.

A former Tata Consultancy Services Ltd veteran who joined Wipro as chief operating officer in April 2015, Neemuchwala remains confident that by the end of March 2018, Wipro will be able to come back to industry-matching growth. Edited excerpts:

You have already stated that Wipro will come back to industry-matching growth by March 2018. How would you view the performance in this quarter?

When I started, we had set ourselves a plan, and milestones. The current quarter, I will call it as evidence of disciplined execution of strategy. As you know, some of the best strategies if not executed well, fizzle out.

I believe this is certainly one of my best quarters and we have got a momentum. I feel pretty good, as we have got results from client mining, (high growth) from top ten clients. Even from margin perspective, we have done reasonably well.

So is the worst behind?

I personally feel the worst is behind. We had Wipro-specific issues and most, if not all, are behind us.

So unless there is a macroeconomic uncertainty or challenge, I believe we have got the momentum to deliver industry-matching growth numbers by March 2018, as previously stated.

One continuing criticism of your stint at CEO is that you continue to shy away from taking tough decisions when it comes to making or appointing leaders. Executives at Wipro believe the firm is giving a long rope to its leaders at the top, and that Azim Premji (chairman) has to be consulted on making some of the executive changes. Analysts believe you have continued with the same set of leaders.

Firstly, let me tell you that I have an excellent working relationship with Mr Premji. A visionary leader. He is going to get the Nobel peace price equivalent in philanthropy, The Carnegie Award. On business, he gives me complete freedom. He is available whenever I need him.

I’ll tell you how one of the acquisitions which we are doing, I got to know that many other suitors were also vying for it. So I called AHP, as we call Mr Premji, and told him how we have to make this acquisition, and I need to do this. And then we followed the board process and got the acquisition done.

So I have a great working relationship. As CEO he gives me complete authority and holds me accountable for delivery of results.

Now, CEOs do things differently. Some CEOs come and say, look, I’m in a hurry and I have to make all the changes and bring people I know. Some CEOs say that this is a transformation journey, if you have the right people with learnability skills, you help them with a reskilling programme.

You’ve got to give time to people to change and learn with the new environment. I believe a stable leadership team with stable customer relationships is needed. It’s not that I have not brought in new people. But my first priority will be that if you have people within Wipro, then you have to give them a chance.

On the M&A front, Wipro appears to have slowed after having spent over $1 billion last year.

We have a clear vision and strategy. There has been no change in the strategy. When I came in, there were clear gaps. Design (we bought DesignIT), Cloud (we bought Appirio) and Germany (we bought Cellent).

So we were very aggressive. Now, when I look, there still two-three gaps which I cannot disclose. We need to find the right assets in these two-three areas.

Mukesh Ambani’s children Akash, Isha debut before RIL shareholders

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Mumbai: Ambani family scions Akash and Isha debuted before Reliance Industries Ltd (RIL) shareholders on Friday, introducing 4G-enabled feature phone—an offering by its telecom arm which is the company’s biggest bet after petrochemicals.

Accompanied by a fellow director on the Reliance Jio Infocomm Limited (RJIL) board, Kiran Thomas, the 25-year-old twins introduced a new cheaper handset JioPhone that was announced by their father and RIL chairman Mukesh Ambani at the AGM.

While Isha restricted to describing the product features, Akash and Thomas showcased the detailed workings like how the phone, which is available at an “effective” cost of zero, operates on voice commands. In the process, there were calls and texts exchanged between Akash and Thomas while standing on Isha’s either side.

Both the scions of the family, which owns around 45% of the country’s biggest corporate, are reported to be educated in American universities. To be sure, this was not the first outing for the duo, who had first introduced the company’s offerings in late 2015.

Apart from utilising the AGM to chart out the company’s roadmap for ten years, the 60-year-old chairman Mukesh Ambani had a unique request for shareholders which spoke volumes about the twins’ importance. “As a new generation of leadership emerges at our company, I seek your blessings for them to take Reliance to new heights of success and glory,” the father said.

Before this, he called Jio as a young company with 1 lakh employees led by the 25-year-old twins. “Jio is a young organisation and Akash and Isha, our directors at Jio, both 25, lead a large contingent of success-hungry and highly talented professionals,” he said.

The chairman called the next ten years as a “golden decade” for RIL, which will be completing fifty years as a listed entity in 2027. He said the company will achieve more in this decade than what it has done in the last 40 years.

Mukesh had joined the company in 1981, while he was still pursuing MBA at Stanford, to help erect the company’s biggest bet at that time—a polyester plant at Patalganga on the outskirts of the financial capital.

RIL announces bonus issue, first in eight years

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Mumbai: Reliance Industries Ltd (RIL) chairman Mukesh Ambani announced a 1:1 bonus issue for shareholders on Friday, outlined plans to invest in renewable energy and said the conglomerate will target higher profits from its consumer businesses.

“The golden decade of Reliance has begun,” Ambani said at the 40th annual general meeting of RIL in Mumbai.

This is only the third time the energy giant, which also has interests in retail and telecom, has announced a bonus issue since listing in 1997. It offered 1:1 bonus shares in 1997 and 2009. Prior to that, in 1983, shareholders received three shares for every five they held. RIL’s stock closed the day up 3.76% at Rs1,586.20 on the BSE.

Ambani said the company had invested Rs3.3 trillion in the last five years, with Rs2 trillion going to digital services and the rest to the energy and material business.

Ambani said the company plans to invest in renewable sources of energy, without specifying targets or timelines.

“We will invest in new materials which will have dramatic and multiple new applications,” he said.

Among other plans, Ambani said he had set his consumer businesses a target of achieving profitability similar to RIL’s energy and materials business within the coming decade.

The refining segment had an earnings before interest and tax (Ebit) margin of 10% in the last fiscal year and the petrochemical segment 14%. In comparison, the retail segment had an Ebit margin of 2.3%.

“In the next decade, consumption spending in India will grow four times and organized retail 6-8 times. We will continuously expand Reliance Retail’s geographic spread and fulfilment capability,” Ambani said. RIL plans to scale up its network of stores rapidly over the next 12 months to penetrate into Tier 2 and Tier 3 cities.

Ambani said RIL plans to reach Rs1 trillion in earnings before interest, taxes, depreciation and amortization, an indicator of operating profitability, within “the next few years”.

“We also were expecting the low-down on how Ambani plans to monetize Jio better and pay off the debt RIL has piled up due to its foray in telecom,” said an analyst with a domestic brokerage on the condition of anonymity.

Although Ambani announced ambitious plans for telecom unit Reliance Jio Infocomm Ltd, he didn’t mention any debt-reduction plans on Friday. RIL had consolidated debt of Rs1.97 trillion at the end of FY17.

BlackBuck appoints former Bluestone executive Arvind Singhal as COO

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New Delhi: Former BlueStone chief operating officer (COO) Arvind Singhal has been appointed as a top executive at Zinka Logistics Solutions Pvt. Ltd, which owns online freight services aggregator BlackBuck, a top industry source familiar with the matter said.

Singhal, an IIT Bombay and IIM Calcutta graduate, was with the online jewellery company since September 2015. He resigned from the position of COO in March this year.

Earlier, he was CEO of cab-hailing service Taxi For Sure.

BlackBuck features among the best funded online freight start-ups in India. Mint reported on 22 March that the company raised $70 million from Sands Capital, IFC and Accel Partners in March 2017.

Confirming the news, a spokesperson at BlackBuck told Mint that Singhal will be joining as the COO of one of the business units.

“I am very excited to be part of the BlackBuck team which is on the course to transform the Indian transportation industry. I am looking forward to adding value by digitizing the freight space leveraging technology,

RIL to invest $25 million in Israeli start-up incubator

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Reliance Industries Ltd (RIL) on Thursday said it would invest $25 million in Israel-based Jerusalem Innovation Incubator (JII).

The technology incubator will focus on start-ups in big data, analytics, the Internet of Things, artificial intelligence and storage and financial technology, among other areas.

“Most of these domains align with our businesses and strategic interests,” RIL said in a filing to BSE.

“The investment in JII shall be done in partnership with OurCrowd (an Israel-based start-up crowd-funding platform), Motorola Solutions and Yissum (a technology transfer company of Hebrew University of Jerusalem),” RIL said in the filing.

JII will be a limited liability partnership, with RIL holding a 20% stake. The remaining will be held by OurCrowd (60%) and Motorola (20%). Yissum, a non-investing partner, will provide JII with research and development support.

The incubator will invest in early-stage start-ups over a period of eight years.

JII is licensed by the Israel Innovation Authority (IIA), which functions under the Israeli ministry of economy.

“The proposed investment in JII would help pool significant amount of capital which is essential and foundational to fund the cutting edge innovation required by early-stage start-ups in partnership with IIA,” RIL added.

After several investor bets on food and grocery delivery start-ups soured, venture capital firms have been pouring money into financial technology and artificial intelligence companies. Nearly 300 start-ups are using some form of artificial intelligence, according to Tracxn, a start-up tracker.

Fintech start-ups led by digital wallet and payments bank Paytm raised roughly $2 billion in 2015 and 2016, according to Tracxn.

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