Wipro Share Q3 Results

Wipro Q3 Results

Corporate Action
by 5paisa Research Team Last Updated: 2022-08-08T18:43:30+05:30

Among the big bulge bracket IT companies, Wipro came under pressure with operating margins and net margins taking the biggest dent. This was largely on account of a sharp spike in sub-contracting costs, higher employee costs as well as higher input costs for its hardware IT products division. Overall, costs pinched operating profits in a big way. Here is a gist of the numbers for the Dec-21 quarter.
 

Rs in Crore

Dec-21

Dec-20

YOY

Sep-21

QOQ

Total Income (Rs.cr)

₹ 20,314

₹ 15,670

29.63%

₹ 19,667

3.29%

Operating Profit (Rs.cr)

₹ 3,442

₹ 3,336

3.18%

₹ 3,398

1.32%

Net Profit (Rs.cr)

₹ 2,969

₹ 2,968

0.03%

₹ 2,931

1.31%

Diluted EPS (Rs.)

₹ 5.42

₹ 5.17

 

₹ 5.35

 

OPM

16.95%

21.29%

 

17.28%

 

Net Margins

14.62%

18.94%

 

14.90%

 

 

As can be seen in the above table, Wipro revenues were up a healthy 29.63% for the Dec-21 quarter at Rs.20,314 crore on a consolidated basis. In sequential terms, the revenues were up by 3.29% but the real story lies in the bottom line to which we will come back to later.

During the December 2021 quarter, the region of the Americas accounted for 58% of the total revenues in IT services. The European region comprising of UK and continental Europe accounted for 30% while the balance 12% was accounted for by the APMEA region; which is the Asia Pacific, Middle East and Africa region.

Operating profits grew by a measly 3.18% YoY at Rs.3,442 Cr in the Dec-21 quarter. The pinch came from the manpower costs and the sharply higher sub-contracting expenses during the quarter. The input costs in the IT products business also saw spike.

As a result, the operating margins fell very sharply from 21.29% in the Dec-20 quarter to 16.95% in Dec-21 quarter, a fall of 434 basis points This was largely on account of static operating profits amidst sharply higher sales revenues. Operating profits were up just about 1.3% on sequential basis compared to Sep-21 quarter.

Profit after tax (PAT) for the Dec-21 quarter was almost flat, up by just about 0.03% at Rs.2,969 crore due to the impact of higher operating and non-operating costs in the quarter getting transmitted to the bottom line. As a result, the PAT margins narrowed from 18.94% in the Dec-20 quarter to 14.62% in the Dec-21 quarter. The board has declared an interim dividend of Rs.1 per share, but the real story was all about operating pressures.


Start Investing in 5 mins*

Get Benefits worth 2100* | Rs. 20 Flat Per Order | 0% Brokerage

About the Author

Our research team is composed of some highly qualified research professionals, their expertise range across sectors.


Open Free Demat Account

& get benefits worth 2100*

Resend OTP
Please Enter OTP
  • Have Promo code?
  • Use code ACT2100
Enter Promo code
Account belongs to

By proceeding, you agree to the T&C.

Start Investing Now!

Open Free Demat Account in 5 mins

Enter Valid Mobile Number