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Wednesday, Aug 31, 2005

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Premji to reduce holding in Wipro at `appropriate stage'

Our Bureau

New Delhi, Aug. 30

IT major Wipro Ltd's Chairman, Mr Azim Premji, today said he would reduce his existing holding of over 82 per cent in the company at an "appropriate stage", but did not specify a timeframe.

"There is an intent to reduce the holding from over 82 per cent at an appropriate stage. This would enable more float in the stock," Mr Premji said at an interactive session with the media here.

"At an appropriate stage we will come down in the shareholding but I cannot give definite timeframe. I understand in large companies, large float is desirable," he pointed out.

Responding to a query on the Securities and Exchange Board of India's recent norm that requires listed companies to maintain at least 25 per cent shareholding with the public for the purpose of continuous listing, he said, "We are taking technical interpretation of it. But I do not think it applies to us." He, however, declined to comment any further on the issue.

The public holding in Wipro is currently about 17.6 per cent.

On competition from other emerging countries in the ITES space where India currently has a stranglehold, he said Eastern Europe had strong technical skills. "We will have our own centre in Eastern Europe, and we have identified two countries. Things will take shape in 12 months," Mr Premji said.

He said Wipro is looking at countries such as Bulgaria, Hungary and Romania.

Wipro, which has centres in Beijing and Shanghai serving international customers, also plans to expand in China. "The domestic market in China is more competitive. I would much rather use China to serve international customers. We will expand in China because customers are forcing us to. However, there are Intellectual Property related concerns," he said.

Earlier while addressing the forum, Mr Premji mooted a five-pronged approach envisaging strengthening of investment climate in India to consolidate the country's position in a knowledge economy.

"We need to promote macro-economic stability and competition by good regulatory policies; legal rules and procedures conducive to entrepreneurship and risk-taking. We need to simplify and expedite procedures for entry and exit of firms. This has always been true, but I think direct relevance of investment to implicit and explicit knowledge creation should not be underestimated," he said.

Other focus areas include education, innovation, building cost leadership and customer centricity.

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