Impressive net profit of 21% for Wipro; 1:1 bonus issue planned

IT giant Wipro, which announced on Thursday its quarterly results ending on September 31,   posted a 21% surge in its net profit to ₹3,209 crore, compared to ₹2,646 crore in the same period last year.

Wipro recommended the issue of bonus shares to shareholders (including stock dividends to ADS holders) in the ratio of 1:1 (1 equity share for every 1 equity share held), subject to the approval of shareholders.

“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. We will continue to invest in our clients, our strategic priorities, and building a strong AI-powered Wipro," said Srini Pallia, CEO and managing director of Wipro.

Key highlights from Wipro's Q2 results

Net profit and revenue: The net profit for the quarter rose by 21% to ₹3,209 crore, up from ₹2,646 crore in the same period last year. Meanwhile, revenue from operations in the reported quarter was ₹22,302 crore, slightly down from ₹22,516 crore recorded in the same quarter of the previous financial year.

Total bookings and margin: Total bookings reached $35.61 core, with large deal bookings totalling $14.89 crore. This represents a quarter-over-quarter increase of 28.8% and a year-over-year rise of 16.8% when adjusted for constant currency. The operating margin for IT services in the quarter was 16.8%, reflecting a 0.3% increase quarter-over-quarter and a 0.7% increase year-over-year.

Other key measures: Non-GAAP2 constant currency revenue for the IT Services segment rose by 0.6% quarter-over-quarter but fell by 2.3% year-over-year.

Earnings per share for the quarter reached ₹6.14 ($0.071), reflecting a quarter-over-quarter increase of 6.8% and a year-over-year increase of 21.3%.

Operating cash flows were reported at ₹4,270 crore ($50.97 crore, reflecting a year-on-year increase of 10.5% and representing 132.3% of net income for the quarter.

“I am pleased with our performance across all parameters including Revenue, Bookings, Operating margin, cash flow, and EPS. On the back of operational improvements, we further expanded our margins by 35 basis points and our EPS grew 6.8% QoQ. Our operating cash flow continues to be robust at 132.3% of net income in Q2. As a result, cumulatively in the first half of this year, we generated nearly $1B in operating cash flow,” said Aparna Iyer, chief financial officer of Wipro.

Bonus issue

The Wipro board has recommended a bonus share issuance at a 1:1 ratio. The record date for this bonus issue will be announced at a later time.

(By arrangement with livemint.com)