Wipro eyes $1 bn revenue from health care & life sciences by 2015

Company's quarter-on-quarter growth, about 8% in the segment, was higher than rivals

Wipro, India’s third largest information technology (IT) services company, says its health care and life sciences vertical is well on track to become a $1-billion (Rs 6,230 crore) business by 2015.

The company plans to achieve the milestone through a combination of organic and inorganic growth, Sangita Singh, senior vice-president, health care and life sciences, told Business Standard.

“In line with Wipro’s strategy, we are open to build competencies inorganically and are evaluating options on an ongoing basis. We are actively looking for opportunities where we can make acquisitions that can serve our clients in the US,” she said.

Health care and life sciences, which accounts for a little over 10 per cent of overall revenue, has been one the fastest growing business units of the company. In FY13, it generated revenue of $600 million (Rs 3,735 crore).

While its competitors also posted strong growth in health care and life sciences during the October-December 2013 quarter, Wipro beat them by posting a 7.6 per cent sequential growth in the unit, fastest among all verticals. During the quarter, close rival Infosys posted five per cent sequential growth in health care and two per cent in life sciences. Without sharing any numbers, Tata Consultancy Services said its health care and life sciences business, along with manufacturing, media, travel and hospitality, led growth during the quarter.

On acquisition in the health care segment, Singh said Wipro looks at areas such as accountable care, care management, eligibility and enrollment. In life sciences, the company focuses on buyouts in areas such as compliance and patient-centricity.

“The past two quarters were very good for us and we are expecting to perform well in the ongoing quarter as well,” Singh said. “I think there is a momentum in the market in the health care and life sciences (sector).”

Singh said India, West Asia and the US markets will be Wipro’s focus areas for the next two years for these businesses.

Indian IT services companies have been betting highly on the health care segment in the US, on the back of the Patient Protection and Affordable Care Act, commonly known as Obamacare. However, due to the slower-than-expected implementation of the Act, there have recently been concerns about the scope of business for Indian IT players in the near term. Since its launch in October, Obamacare has been facing several technical problems.

“It has not happened on the scale at which we wanted. So, it is still fragmented,” Singh said.

In India, however, with the mushrooming of world-class hospitals and medical facilities, opportunities for Wipro are growing, Singh added.

“We are one of the smallest business units of Wipro. We believe in client-centricity,” she said.