Wipro Ltd, the third largest Indian software major after TCS and Infosys, suffered a negative growth in its net profit for the fiscal year 2002-03 due to Rs 37.1 crore (Rs 371 million) loss from Wipro GE Medical Systems, a joint venture with GE in which it has a 49 per cent stake.

As a result, Wipro's profit after tax dipped to Rs 860 crore (Rs 8.60 billion) from Rs 894 crore (Rs 8.94 billion) in the previous fiscal (2001-02).

This is not all, in the 12-month period Wipro's net revenue took a hit of Rs 37.8 crore (Rs 378 million) from its ISP business, WiproNet, which it sold to the Chennai-based Satyam Infoway during the second quarter of FY 2003.

A SWOT analysis of the impact of Wipro's losses incurred on account of Wipro GE Medical Systems and WiproNet shows that its bottomline declined by Rs 74.90 crore (Rs 749 million), or around 8 per cent during the fiscal year ending March 31, 2003.

In addition, a company official told rediff.com in Bangalore on Thursday that the tax burden on its income under Section 10A of the Income Tax Act for software exports led to an outgo of Rs 134 crore (Rs 1.34 billion).

Similarly, rupee appreciation during the last two quarters of the fiscal year under review indicates that software revenue exports of Wipro suffered a loss of one per cent.

"In short, the company posted a negative growth of about 10 per cent over its previous fiscal year's bottomline," the official admitted.

Meanwhile, Wipro's earnings per share continued to remain flat with decimal dip over the previous year, with basic at Rs 38.63 (Rs 38.65) and diluted at Rs 38.75 (Rs 38.78).

Though Wipro czar Azim Premji continues to hold a major chunk of its stock holding, the company's board of director has recommended a dividend of Rs 1 per share of Rs 2 or 50 per cent.

The company's margins came under pressure in IT services due to lower billing rates, acquisitions, and a rising rupee, while the same expanded in its BPO business run by Spectramind.

In the first year of operations after acquisition, Wipro Spectramind posted a revenue of Rs 160 crore (Rs 1.6 billion) with a gross profit of Rs 39.5 crore (Rs 395 million).

"We have added six more customers in the fourth quarter taking the total number to 15 for the year. As a result, hiring went up to 5106 during January-March (Q4), 2003 from 3884 in the third quarter (October-December 2002)," said Spectramind CEO Raman Roy.

While revenue from the US market constituted 63 per cent against 57 per cent in the previous fiscal year, share of revenue from Europe declined to 30 per cent from 36 per cent.

Wipro added (net) 3848 people during the fiscal year under review, taking the total number of employees to 13, 474 as against 9626 in the previous year.