Wipro net dips in Q3; revenue guidance up for Q4

Global software major Wipro Ltd on Wednesday reported Rs 2,115 crore net profit for the third quarter of 2016-17, a decline of 5.7 per cent from Rs 2,246 crore over the same period last year.

The city-based firm, however, projected marginally higher revenue for the fourth quarter from IT services business.

"Revenue from our IT services business will be in the $1,922-1,941-million range for the fourth quarter ending March 31," said the company in a statement here.

The slightly higher guidance is based on $1,903-million revenue posted for the third quarter though less than the projected $1,916-1,955 million in October.

Consolidated revenue for the quarter under review grew 6.4 per cent to Rs.13,688 crore from Rs.12,861 crore in like period year ago under the Indian accounting standards.

Under the International Financial Reporting Standard (IFRS), net income translates into $309 million and revenue to $2,015 million in dollar terms.

Revenue from the flagship IT services business grew 3.5 per cent annually to $1,903 million from $1,838 million year ago but declined sequentially 0.7 per cent from $1,916 million quarter ago under the IFRS.

In rupee terms, revenue from IT services increased 7.2 per cent annually to Rs.13,200 crore for the quarter under review.

Gross Profit from IT services segment also declined 1.3 per cent to Rs.2,400 crore or $355 million on annualised basis.

Operating margin improved 50 basis points sequentially to 18.3 per cent from 17.8 per cent quarter ago but declined annually from 19.9 per cent year ago.

"We expanded operating margins 50 basis points in a seasonally weak quarter and generated operating cash flows by disciplined execution." said Wipro Chief Financial Officer Jatin Dalal.

The IT services division added a record 108 new clients during the quarter as against 47 quarter ago and 39 year ago, taking the total to 1,259 as against 1,180 quarter ago and 1,105 year ago.

"Our investments in digital, BPaaS (Business Process as a Service) and cloud applications position us as the partner of choice for our clients. Digital ecosystem grew 9.9 per cent sequentially in Q3 and constitutes 21.7 per cent of our revenue," said Wipro Chief Executive Officer Abidali Z. Neemuchwala in the statement.

The IT services business added 4,891 techies in the quarter taking the headcount to 179,129 from 174,2387 quarter ago and 170,664 year ago.

"In the last year, we have invested $1 billion in acquisitions, made six investments through Wipro Ventures, funded 8 ideas through Horizon programme, and continued to invest Ain our cognitive platform, Wipro HOLMES and in our stated localization strategy," added Neemuchwala.

The company's blue chip scrip, however, lost Rs.7.65 or 1.59 per cent lower to end at Rs.473.45 per share of Rs.2 face value (at par) as against the Tuesday's closing price of Rs.481 and opening rate of Rs.479.10 on the BSE in Mumbai.

--IANS

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