Wipro June Quarter Profit At Rs. 2,388 Crore, Beats Street Estimates: 10 Points

Wipro June Quarter Profit At Rs 2,388 Crore, Beats Street Estimates: 10 Points

Wipro said it expects IT services revenue at $2,039 million-$2,080 million in the September quarter

Wipro, the country’s third largest software services company, on Wednesday reported a net profit of Rs. 2,387.6 crore for the quarter ended June 30. That marked a decrease of 3.86 per cent compared to its net profit of Rs. 2,483.5 crore for the quarter ended March 31, but was higher than analysts’ estimates. Wipro’s net profit in the April-June period was boosted by robust demand from its key financial clients. In a poll conducted by news agency Reuters, analysts had on an average expected a net profit of Rs. 2,324 crore in the first quarter of the current financial year.
Here are 10 things to know:
  1. In a regulatory filing after market hours on Wednesday, Wipro said its revenue stood at Rs. 14,716.1 crore for the quarter, marking a fall of 1.93 per cent compared to Rs. 15,006.3 crore the previous quarter.
  2. “Our efforts on client mining have resulted in an addition of three customers in more than $100 million bucket,” said Abidali Z Neemuchwala, CEO and executive director, Wipro.
  3. Wipro said it added three accounts to the $100 million-plus revenue bucket during the quarter.
  4. “We will continue to build differentiated capabilities to drive business transformation for our customers by investing in our big bets,” Mr Neemuchwala added.
  5. Wipro said it expects its IT services revenue to be in the range of $2,039 million-$2,080 million in the quarter ending September 30. This translates to a sequential (quarter-on-quarter) growth of 0-2 per cent, it added.
  6. The company said it has filed the draft letter of a buyback offer with market regulator Sebi after shareholders’ approval. It also said it will complete the buyback process after Sebi’s nod. Wipro’s board had in April this year approved the Rs. 10,500-crore share buyback proposal.
  7. The company’s rivals Tata Consultancy Services (TCS) and Infosys, which reported their earnings last week, saw upbeat profit even as both flagged a teetering economy in the Western markets. Most of their revenue comes from the US and Europe markets.
  8. Events such as Brexit and the trade tussle between the US and China have slowed these economies, threatening to squeeze the over $150-billion Indian IT services industry as well.
  9. However, some analysts say the earnings might not boost the stock significantly. “Wipro numbers are not very good and not in line with the guidance given earlier. However, this has been already priced in,” Avinash Gorakshakar of Joindre Capital told NDTV.
  10. Wipro shares ended 0.13 per cent lower at Rs. 259.70 apiece on the BSE ahead of the earnings announcement by the company, underperforming the benchmark Sensex index, which finished up 0.22 per cent rising for a third straight session.