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    Wipro Sept quarter net down 8.2%: Top five takeaways from earnings

    Synopsis

    The firm maintained margins in Q2 despite the impact of salary rise for an incremental two months due to operational improvements in automation-led productivity.

    ETMarkets.com
    NEW DELHI: Wipro Ltd reported a consolidated net profit of Rs 2,070 crore for the quarter ended September 30, on Friday which was slightly above ETNow estimates of Rs 2,011 crore.

    India's third-largest software services company posted 8.2 per cent year-on-year fall in the net profit to Rs 2,070 crore for the second quarter of current fiscal ended September 2016. The company had reported a net profit of Rs 2,241 crore in the year-ago period.

    Image article boday
    Wipro closed 0.7 per cent higher at Rs 499.20. It hit a low of Rs 493.90 and a high of Rs 504.30 on Friday.

    "We maintained margins in Q2 despite the impact of salary increase for an incremental two months due to strong operational improvements in automation-led productivity, offshoring and utilization." said Jatin Dalal, Chief Financial Officer.

    "As we look forward, the demand environment is mixed in a seasonally weak quarter affected by furloughs and lower number of working days," he said.

    Based on Wipro Q2 results we have collated list of top five takeaways from Wipro Q2 results:

    Dollar Revenues: Wipro's IT services revenues, which account for a substantial chunk of its business, saw a sequential fall of 0.8 per cent to $1,916 million in the said quarter, while on a year-on-year (YoY) basis it grew by 4.6 per cent.

    The rupee revenue saw a sequential growth of 0.2 per cent to Rs 13,136.6 crore for the quarter ended September 30 compared with Rs 13,1092.20 crore reported in the previous quarter and 12,042.70 crore reported in the year-ago period.

    IT Services Margin: The IT Services Margins remained constant at 17.8 per cent on a sequential basis.

    IT Services Segment Margins was maintained at 17.8 per cent as headwinds in salary increases were offset by strong operational improvements in automation-led productivity, offshoring and utilization improvements, Wipro said.

    Outlook for the Quarter ending December 31: Wipro expects revenues from our IT Services business to be in the range of $ 1,916 million to $ 1,955 million. Guidance is based on the following exchange rates: GBP/USD at 1.26, Euro/USD at 1.11, AUD/USD at 0.76, USD/INR at 67.01 and USD/CAD at 1.31.

    "We expect to consummate the Appirio acquisition in Q3 and hence revenues from the acquisition is included in our guidance. However, there is variability in terms of exact date of consummation and our guidance incorporates this variability in the range," Wipro said.

    Business Units growth: Healthcare, Life Sciences & Services grew 4.3 per cent on a constant currency basis sequentially while Energy, Natural Resources, and Utilities grew 1.3 per cent on a constant currency basis sequentially.

    Geographies: Americas grew 1.8 per cent on a constant currency basis sequentially. Europe grew 0.3 per cent on a constant currency basis sequentially. India and Middle East business remain stagnant at 10.4 per cent while APAC and Other market grew marginally by 0.1 per cent.



    ( Originally published on Oct 21, 2016 )

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    (What's moving Sensex and Nifty Track latest market news, stock tips and expert advice, on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds .)

    Download The Economic Times News App to get Daily Market Updates & Live Business News.

    Subscribe to The Economic Times Prime and read the Economic Times ePaper Online.and Sensex Today.

    Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price

    ...more
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