Wipro logs 3.8% rise in Q4 profit; pegs FY23 revenue growth at 16-18%

The company said it saw a drop of 500 bps in attrition on a quarterly basis

Wipro’s reported net profit rose 3.85 per cent year-on-year (YoY) to Rs 3,087 crore in the fourth quarter ended March (Q4). The net profit was up 4 per cent sequentially.

Revenue for the quarter was up 28 per cent at Rs 20,860 crore YoY from the previous year of Rs 16,245 crore. In dollar terms, the company reported IT services revenue at $2.72 billion, up 3 per cent sequentially.  

Wipro met Bloomberg estimates on revenue and profit. According to Bloomberg poll, analysts had pegged the company’s revenue at Rs 20,819 crore and profit at Rs 3,010.9 crore. However, it missed the estimates on margins. The Street will also likely be disappointed in guidance.

The company guided for a revenue growth between 1 per cent and 3 per cent for the first quarter of FY23 or to be in the range of $2,748 million to $2,803 million. The management also stated that based on this growth for FY23 the guidance will be 16-18 per cent.

Thierry Delaporte, chief executive officer (CEO) and managing director (MD), said the company, which crossed the $10-billion milestone in FY22, added one-fourth of its revenue during the financial year.

“We have had an outstanding year, finishing with $10.4 billion in revenues, and an industry-leading growth of 27 per cent YoY. This is our sixth straight quarter of strong revenue growth at or over 3 per cent. With all markets, sectors, and global business lines now growing in double-digits YoY, we have a strong foundation for next year’s growth,” he added.

For the full year, the company reported revenue of Rs 79,093 crore, up 27.68 per cent YoY.

Growth for the year and the quarter was broad-based. Delaporte said the acquisition of Capco grew in double digits and during the year, 60 synergistic deals were signed across markets.

Most regions, including North America, Europe, and Asia, contributed to the company’s sturdy topline growth. During the quarter, the IT services company added two new clients in the $100-million-plus category and three in the $50-million-plus basket.

Higher cost for retention and acquisitions impacted margins for the quarter, which came in at 17 per cent, a 60 basis points (bps) drop sequentially.

“We delivered operating margins of 17.7 per cent for the year, after significant investments on solutions, capabilities, and talent. We also made two acquisitions in the quarter,” said Jatin Dalal, chief financial officer, Wipro.

Attrition, like its peers, remained high at 23.8 per cent, up 22.7 per cent in the preceding quarter. The company, however, said it saw a drop of 500 bps in attrition on a quarterly basis. The company added 19,000 freshers from campuses during the year and plans to double the count in FY23.

The company also made its highest-ever addition in a financial year at 45,416 employees, a multi-fold jump from 14,826 people added in FY21, as demand for talent soared amid a shift to digital and attrition spikes.

The company said it has set up a policy that will give promotions at the junior level on a quarterly basis.