Wipro Q3 net remains flat at Rs2,969 cr

Bengaluru: IT services major Wipro on Wednesday posted largely in line numbers though the momentum decelerates a bit in terms of revenue growth. However, the company's deal bookings remained robust with sound growth outlook for the fourth quarter.

The Bengaluru-headquartered firm reported consolidated profit of Rs 2,969 crore for the December quarter, a rise of 1.3 per cent over the last quarter.

Net profit remained almost flat as compared to the same period of last year. Gross revenues increased 29.6 per cent year-on-year basis to Rs 20,313 crore ($2.7 billion) during the quarter. On sequential basis, it grew 3.3 per cent.

IT services, which contributes more than 95 per cent of Wipro's total income, were at $2.64 billion for the December quarter, which was a 2.3 per cent rise sequentially and 27.5 per cent on YoY basis. In constant currency term, the revenue growth was three per cent sequentially, which came at the mid-range of company's given guidance.

"Wipro has delivered a fifth consecutive quarter of strong performance, both on revenues, and margins. Order bookings have been strong too, and we have added seven new customers in the more than $100 million revenue league, in the last 12 months. Our strategy and improved execution continue to serve us well, and we are confident of building on this momentum," said Thierry Delaporte, CEO & MD of Wipro.

"We have a broad-based growth in this quarter. Our order booking, and pipeline remain very strong. Our deal wins are also accelerating. We don't see any fundamental change in the market going ahead. That is the reason we have given a strong guidance for Q4," he added.

For the fourth quarter of this fiscal year, the IT services company expects its revenues to be in the range of $2.692 billion to $2.745 billion, which will translate into a sequential growth of 2 to 4 per cent.

IT services operating margin for the December 2021 quarter at 17.6 percent, which was 20 basis points lower compared to the previous quarter.

"We delivered robust operating margins after absorbing substantial investments on salary increases, owing to continued improvement in operating metrics," said Jatin Dalal, chief financial officer at Wipro.

The BFSI (Banking, financial services and insurance) vertical, which contributed 35.2 per cent, grew by 4.1 per cent sequentially, while consumer segment saw 5.2 per cent growth in sequential term.

Further, the attrition rate stood at 22.7 per cent in December quarter, which was 220 basis points higher than the last quarter. "We have stabilised our attrition as the rate of attrition has come down. We expect to see moderation in Q4. As far as hiring of freshers are concerned, we are looking to hire almost 30,000 freshers in the next financial year (FY23)," said Wipro's Chief HRO Saurabh Govil said.

The company has added 10,306 employees during the third quarter taking the total strength of employees for IT services to 231,671. Amid rising Omicron cases, Wipro also announced shutting down offices for next four weeks. In addition, the company's board declared an interim dividend of Rs 1 per equity share.