Two significant Indian IT firms, Wipro and HCLTech, just released their financial results for the first quarter of the fiscal year 2023–24. Both businesses disclosed delayed salary increases and reductions in variable pay, pointing to a trend in the Indian IT industry.
The management of HCL Tech acknowledged that their quarterly results were below both their own projections and analyst expectations. They are actively taking steps to stay on track with their prior projections, such as postponing salary increases for a particular group of employees. The annual salary increases for senior employees, which were typically implemented in the September quarter, have been moved to October. By taking these steps, the company hopes to get its growth back to between 18% and 19%.
In the case of Wipro, they also disclosed a quarter-long postponement of their employees’ annual salary increases. The third quarter is when Wipro intends to implement this year’s increase. A cap of 80% was placed on variable pay for the first quarter of the fiscal year as well as other reductions the company made.
Both companies struggled to meet analyst expectations, and their decisions to postpone pay increases and cut variable pay are efforts to align with their operational needs and adapt to the environment. Wipro’s first-quarter results, which were below analyst expectations, showed an increase in consolidated net profit of 11.95 percent year over year and an increase in revenue of 6.04 percent. For the same period, HCLTech reported a 12.0% increase in revenue and a 7.6% increase in consolidated net profit.