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Global Computer Related ServicesAn Industry Perspective

WTO Cross-Border Supply Symposium

Santosh

Head, Talent Engagement & Development, Europe

Sept 28, 2005

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Wipro confidential 2

The agenda

Industry Snapshot

Wipro Advantage

Outlook Going Forward & Key Challenges

1

2

3

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Landscape of Computer Related (IT) ServiceIndia Advantage

ApplicationDevelopment

SystemsIntegration

ProductEngineering

Consulting

ERP Services

BPO

InfrastructureManagement

IndependentTesting

Services from India touch all three aspects of IT software, hardware & network

Indias Emergence as IT Sourcing Hub

Key Drivers

Highly Talented Labor Pool

Cost Arbitrage

Leapfrog increases in Telecom reliability

in 90s

Quality Advantage Faster Time to Market

24 Hour Service Window

Enables customers internal work-force to

focus on core & strategy

Range of Services
http://www.culturefocus.com/india_pic43.htmhttp://www.culturefocus.com/india_pic43.htmhttp://www.culturefocus.com/india_pic43.htmhttp://www.culturefocus.com/india_pic43.htm

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Translating into >30% Growth for Indian Industry;.. & Corresponding Cost Savings for Customers

2.64

6.2

7.7

9.6

12.8

17.2

22

0

5

10

15

20

25

98-99 99-00 00-01 01 - 02 02- 03 03- 04 '04-05 05-06E

Americas,

69.4%

Europe,

22.6%

Japan, 3.0%

Africa, 0.6%

Others, 4.4%

$ Bn

Source: NASSCOM, Strategic Review 2005

Geo Distribution

Export of Computer Related Services

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Offshore,

7.5%

Non-

Offshore,

96.6

And Yet, Indias True Potential is Far from Realized

India, 72%

Philippines,

8%

Eastern

Europe, 8%

China, 7%Others, 1%

Middle East

& Africa, 2%Latin

America, 2%

Worldwide Offshore IT Services Export

Share by Region, 2003

Share of Offshore in Total IT Services Pie

Adopted from IDC, Gartner & Nasscom Estimates

Even at 72% Share of total offshore spend, India accounts for less than

6% of Global IT Spend

Total Global ITSpend (2005): $640 Bn

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Even as more & more Global Corporates AdoptOffshore Model

Goldman Sachs, September 2005

we continue to expect a robust demand backdrop for offshore services over the next two

years which should drive sustained growth of at least 25%-30%. In our opinion, the

predominant factor driving growth is the continued adoption of the offshore model,

which by our estimates continues to be low.

From a client IT budget perspective, our estimates suggest that that the offshore

model has penetrated less than 10% of Global 500 (G-500) IT budgets for core

application maintenance and development work.

Leveraging Offshore Model = Delivering Greater Shareholder Value through Smart Sourcing

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7/19Wipro confidential 7

The agenda

Industry Snapshot

Wipro Advantage

Outlook Going Forward & Key Challenges

1

2

3

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Ranked leader by IDC, MetaGroup, Forrester 2004Awarded the highest rating in Stakeholder Value Creation & Corporate Governance by ICRA,an Associate of Moodys Investor Services

Partner to industry leadersand challengers

89 global 500 clients 151 clients among Forbes 2000

Diverse talent pool

23 nationalities

2000 domain consultants

Sustained growth

CAGR of 42% in last 5 years

Part of NYSEs TMT (Technology-Media-Telecom) Index, NSE NiftyIndex and BSE Sensex

2000-01 2001-02 2002-03 2003-04 2004-05 2005-06

217 226288

339421

430

10 1319 29

42 42(thousands)

(millions USD)

384 475625

9341354

1595*

Clients

Employees

Revenues

Wipro Today

*June Quarter Revenues Annualized

Incorporated in 1945; 60 years track record of growth & profitability

IPO in 1946; Listed at NYSE [WIT] in 2000

Entered IT business in 1980s; IT Services business launched in 1991

Our history a track record of success

Compounded Growth Rate- First 59 Years:

Revenues: 21%, Net Income: 31%, M-Cap: 24%

IT Services Foot-Print

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Growth Envisaged Across the Range of Services

Constantly incubating newer services

Source: Mckinsey-NASSCOM Study, NASSCOM, Company estimate ( all figures in USD B)

Percentages below the pie chart represent Wipros distribution of Revenues for the Quarter ended June 2005

IT EnabledServices / BPO

11%

PackageImplementation

11%

InfrastructureOutsourcing

8%

Consulting5%

CustomApp Dev &

Maintenance25%

1.7

6.5

0.3

3.6

5.2

13.5

0.3

3.6

0.6

4.9

Indian Export

Potential*

FY04

FY09CAGR 21%

CAGR 64%

CAGR 64%

CAGR 52%

CAGR 31%

Wipros Global IT Revenue pie

3.6

21CAGR 42%

R&D Services

32%

Q1 2005-06

$398.5 M

Testing Services8%

1.1

3.1

CAGR 23%

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Manpower Demand-Supply Scenario:Wipro- Preferred IT Employer

Wipro career portal

Offer

Evaluation

100%

15%

4%

0.8%Trackapplicant

Retain

Candidate applications

Screen / manage

2001-02 2002-03 2003-04 2004-05 2005-06 2006-07 2007-08 2008-09

Total Manpower in IT Services 416 490 588 697 839 1010 1215 1462

Additional Manpower Required in IT

Services56 74 98 109 142 171 205 247

Supply of IT Engineering Degree Graduates 71 81 95 100 111 117 123 129

Manpower Excess 15 7 -3 -9 -31 -54 -82 -118

Supply of IT Engineering Graduates (Degree

& Diploma)115 127 141 165 181 193 203 213

Manpower Excess 59 53 43 56 39 22 -2 -34

Total Supply Non IT + Graduates Entering

IT67 74 70 70 70 70 70 70

Manpower Excess 126 127 113 126 109 92 68 36

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Q-cult: Enterprise-wide quality culture forcontinuous improvement

4,000+ employees trained in Six Sigmamethodologies

204 certified black belts and 10 master black belts

Over700 PMI certified consultants, highest in India

All fresh recruits undergo a 3 day Veloci-Q training

33% business parameters for the Wipro CEOrelate to quality

People

SixSigma

Worlds first SEI CMM/CMMI Level5 IT services company (1998-2002)

BS7799 ISO 9000

Worlds 1stIT Services Company to

use Six Sigma (1999)

1st company

outside the USA

to receive IEEE

award (2003)

Worlds 1st

PCMM Level 5

software

company (2001)

Wipro clients see additional application maintenance

productivity of 10% to 15% from added familiarity with

systems; another 10% to 15% raise in productivity after

applying Wipro's CMM-based methodology and

consolidating redundant programs applications; and yet

another 3% to 30% productivity improvement thanks to

process automation and tools

Forrester

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An increasing number of offshore players arebuilding greater presence in the United States.

Examples include Wipro, with its acquisition of the

consulting company formerly known as NerveWire

- US customer experiences and best practices whengoing offshore, IDC, May 2004

What analysts speak about us

- No Longer Off-Broadway: Offshore Moving to CenterStage, META Group, May 2004

Wipro's most recent annual results provide furthervalidation that upscale/upstream services provided

by "offshore" firms are now mature

because of its brand, impressive size, and breadth of

capability, Wipro is often selected as a strategic partner bycustomers seeking large, broad-based capability in their

primary offshore outsourcing providers. .

- Indian Offshore Suppliers: The Market Landscape, Forrester,April, 2004

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The agenda

Industry Snapshot

Wipro Advantage

Outlook Going Forward &Key Challenges

1

2

3

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India continues to rank as the preferred destination

Likely to benefit disproportionately from Offshoring Drive

China

CIS

Mexico

India

Philippines

People Sophistication(Number, Cost, Language Skills)

VendorSophistication

(Number,Quality)

Russia

Cos

t

Quality of Supply

(Resource Availability, CMM Level, Cultural Fit)

China

Hungary

Philippines

Malaysia

Mexico

India

Ireland Israel

Singapore

IndiaLow CostHigh QualityDevelopment

Source: McKinsey-NASSCOM study

Deep Rooted strength for sustained global market-share gain

4.7

0.5

0.9

1.8

1.9

12.6

17.2

39.6

Others

Mexico

Philippines

Eastern Europe

China

Canada

India

Total

Source: Nasscom

10.0

1.1

2.6

6.4

5.0

20.9

48.0

94.0

India - the Preferred Offshore Destination

2004 2008

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And Yet, There Are Challenges

Immigration & Visa Issues

Universal Recognition of Qualifications, Experience and Training

Employment laws enforcing local hiring

Wage Parity Insisted upon

Social Security Tax

Tax Withholding

Movement of Employees

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Structure of Entity (Branch, JV, Fully owned Subsidiary etc.)

Restrictions on Foreign Investments & Local equity participations

Remittance of foreign exchange

Staffing & Management conditions

Restricted Access to certain market segments based on the structure

Dual Taxation

Government Regulation on Business Entity & Vendor Selection

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Macro environment related

Improving quality of technical education in India

Challenges posed by Urban infrastructure

Preparing for competition from other low cost countries

Business model related

Expanding the breadth of service offering

Managing scale without diluting quality & delivery excellence

Expanding geographies & adapting to local language and cultures

Financial

Adverse currency fluctuations

Managing wage inflation

M&A and their impact on financials

Other Challenges

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Conclusion

Offshore Model is a Great Opportunity for Developed nations to achieve

Highest Quality services at reasonable prices

Visa & Immigration, Taxation, Protectionist Law and Uniformity in

Qualification are some of the key challenges still faced by a service

provider like us

A uniform GATS framework and commitment will provide the right

impetus to the growth of Cross-Border IT Services

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Q&A

Our promiseWith utmost respect to Human Values, we

promise to serve our customers with Integrity,

through Innovative, Value for Money solutions,

by Applying Thought, day after day

Information contained and transmitted by this presentation is proprietary to Wipro Limited and is intended for use only by the individual or entity to which it is addressed,

and contains information that is privileged, confidential or exempt from disclosure under applicable law.

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