Business

Wipro profit rises 12.6% to ₹2,388 crore

Firm gives subdued revenue guidance

Tech major Wipro posted a 12.6% year-on-year growth in net profit to ₹2,388 crore, during the quarter-ended June against ₹2,121 crore in the corresponding quarter a year ago.

During the June quarter, the company posted a gross revenue of ₹14,716 crore against ₹13,978 crore last year, marking a 5.3% growth year-on-year. In dollar terms its IT services revenue declined 1.3%.

The company said factors like macro uncertainties, softness in manufacturing and healthcare, slowness in BFSI, project deferrals and delay in decision-making by clients have been the reason for the growth decline. However, it saw robust demand from key financial clients.

Wipro also set a subdued revenue guidance for second quarter of FY20. The company expects revenues from IT services to be in the range of $2,039 million to $2,080 million, which translates to a sequential growth of 0-2% for the quarter ending September. Wipro CEO and executive director Abidali Z Neemuchwala said, “We had a slow start for the year than what was expected with revenues being down sequentially by 0.7%, though within our guidance range of -1% to 1%. Our YoY growth in constant currency terms was at 5.9%. Q1 is typically a weak quarter for us and we entered the quarter with macro uncertainties.’’

The demand environment was stable in the global markets, but in pockets like BFSI the decision-making has been slower due to overall macro environment, he said. “However, we are hopeful that some of this delay and deferral is temporary and will improve as we progress through the year,’’ said Mr. Neemuchwala.

The company’s digital business continued to see strong growth with revenue growing 5.6% QoQ and 34.6% YoY. Digital revenue now contributes 37.4% of the total business.

Addressing the media, Mr. Neemuchwala said, “Our wins in digital demonstrated this quarter that our leadership position as both digital and cloud transformation partner, provides our clients end-to-end capacity they require for their growth and future success.’’

Jatin Dalal, chief financial officer, Wipro said: “We had a slower start to the year. We, however remain focused on our operations and continue to invest in talent and capabilities for the future. Our focus is to get back on the revenue trajectory.”

On client mining, the company said, in Q1, it efforts on client mining have resulted in an addition of three customers in more than $100 million bracket.

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Printable version | Jun 6, 2020 5:17:25 PM | https://www.thehindu.com/business/wipro-profit-rises-126-to-2388-crore/article28525406.ece

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