Wipro Records 21.2% Increase in Net Profit at Rs 3,208 cr; Issues Bonus Shares

Bengaluru: Wipro on Thursday posted inline second quarter performance with sound deal pipeline and steady operating margin profile. The IT major also announced a bonus share issue in proportion of 1:1.

In the September quarter, the Bengaluru-headquartered company posted 21.26 per cent rise in its net profit at Rs 3,208.8 crore as compared to Rs 2,646.3 crore reported a year ago.

Its consolidated revenue was at Rs 22,300 crore, a decline of 1 per cent from a year ago period.

IT services revenue, which contributed more than 95 per cent of its total revenue, was at $2.66 billion. This was an increase of 0.6 per cent in sequential term.

The company reported that its total bookings during the quarter were at $3.56 billion. Large deal bookings were at $1.49 billion, an increase of 28.8 percent sequentially and 16.8 YoY in constant currency term. Its operating margin was at 16.8 per cent, an increase of 30 basis points over the previous quarter.

“Based on strong execution in Q2, we met our expectations for revenue growth, bookings, and margins. We continued to expand our top accounts, large deal bookings surpassed $1 billion once again, and Capco maintained its momentum for another consecutive quarter. We grew in three out of four markets, as well as, in BFSI, Consumer and Technology and Communications sectors,”Srini Pallia, CEO of Wipro said.

The company management indicated that its BFSI (banking, financial services & insurance) vertical has witnessed good growth driven by Capco’s consulting-led services. Moreover, the Americas as a geography witnessed sequential growth during the quarter.

“BFSI continues to accelerate led by Americas. We have also seen good growth in telecom on the back of ramp ups from a recent large deal. We are also confident of growth in the energy sector in coming quarters,” Pallia said. “Nothing has changed from last quarter as far as discretionary spend is concerned,” he added.

The company rolled out hikes from September for its employees. Wipro’s CFO, CFO Aparna C Iyer said that there would be margin expansion despite salary hikes given in September.

The company added 978 employees in the second quarter, a second consecutive quarter of headcount increase. Its total headcount stood at 233,889 by the end of September quarter.

“We will hire around 10,000-12,000 freshers in the current financial year. Around 2,000-3,000 freshers will be absorbed every quarter. As far as backlog is concerned, it will be cleared by end of December quarter,” Saurabh Govil, CHRO of Wipro said.

Wipro's Board has recommended issue of bonus shares to shareholders (including stock dividend to ADS holders) in the ratio of 1:1. It means one equity share will be issued for every one equity share held, subject to approval of shareholders. The record date to receive bonus shares will be communicated later, the company said.