Wipro Q2 net profit rises 19% YoY, but falls sequentially

By Podishetti Akash
Ahead of the Wipro results, the company's scrip rose nearly 2% to close at ₹672.35 on NSE. So far, this year the shares have risen by a massive 70.33%. (MINT_PRINT)

Information Technology (IT) major Wipro Ltd on Wednesday reported consolidated net profit of 2,931 crore for the quarter ended September, 2021 (Q2FY22). This is a rise of 19% from 2,466 crore posted in the same period last year (Q2FY21).

However, on a sequential basis, the profit after tax (PAT) fell 9% from 3,243 crore in the previous June quarter (Q1FY22).

Consolidated revenue grew 30% to 19,667 crore as compared to 15,114 crore in the year-ago quarter.

As per Bloomberg consensus estimate, Wipro was expected to post revenue of 19,385.20 crore and a net profit of 2,857 crore.

Wipro said that it has surpassed $10 billion (around 75,300 crore) annualised revenue run rate and is in position to hire 25,000 people in the next financial year.

“The Q2 results demonstrate that our business strategy is working well. We grew at over 4.5% organic sequential growth for a second quarter in a row, resulting in a 28% year-on-year growth in the first half of this financial year. I thank our customers, partners, and colleagues as we surpassed the $10-bn milestone of annualized revenue run rate," said Thierry Delaporte, CEO and MD.

In dollar terms, revenue from the IT services business came in at $2.58 billion, an increase of 29.5% year-on-year. The revenue growth in constant currency was 29% over same period last year.

IT services operating margin during the quarter stood at 17.8 %. The company has onboarded 8,150 freshers during the quarter.

Going ahead, the company expects revenue from IT services business to be in the range of $2,631 million to $2,683 million for the third quarter, which translates to a sequential growth of 2% to 4%.

Wipro said it has continued momentum in winning large deals with their customers. During the quarter, the company has won a multi-year engagement with ABB Information Systems to provide digital workplace services for their 100,000+ employees spreading over 100+ countries.

On a trailing 12-month basis, attrition levels in the company rose sharply to 20.5% during the September quarter from 15.5% in the June quarter.

“We sustained our operating margins in Q2 in a narrow band even after absorbing the full impact of our recent acquisitions and investing significantly in our business across sales, capabilities and talent," Jatin Dalal, Chief Financial Officer, said.

"We completed a salary increase covering 80% of our colleagues, making it the second hike in this calendar year. We delivered a robust growth in EPS of 23.8% year-on-year," he said.

Ahead of the results, Wipro scrip rose nearly 2% to close at 672.35 on NSE. So far, this year the shares have risen by a massive 70.33%.


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