Wipro net tanks 21% in Q4

India's third largest IT services firm Wipro on Wednesday reported lower than expected, 21% decline in its consolidated net profit at Rs 1,800.8 crore for the December-March quarter, as it made additional provisions for two of its clients..

The Bengaluru-based IT major had registered a net profit of Rs 2,267 crore in the year-ago period.

On the sequential basis as well, the company's net profit dropped by 7% compared with Rs 1,930.1 crore in September to December quarter.

Earlier, the company on April 9 informed markets that its profit may take a hit of 65-75 basis points in the March quarter as one of its telecom clients is undergoing insolvency proceedings. However, the company’s hadn't named the client.

Its gross revenue also declined 5% to Rs 14,304.6 crore during the fourth quarter, compared with Rs 15,045.5 crore in the corresponding quarter last year.

IT Services Segment revenues in rupee terms remained flat for the company, at Rs 52,840 crore, with IT Services Margin at 15.8%. Excluding the impact of insolvency of two customers and the impairment loss in one of our acquisitions, IT Services Margin for the year was 16.8%, the company said.

On the segmental front, Banking, Financial Services and Insurance (BFSI), continues to be the top contributer to the company's revenues, contributing 29.2% of the revenues during the quarter, followed by manufacturing and technology at 23%.

On the annual basis, the company's net profit dipped by 6%, from Rs 8,517.9 crore in 2016-17 to Rs 8,003.1 crore in 2017-18.

The company's annual revenue also dipped by 2% to Rs 57,035.8 crore, from Rs 58,071 crore in the last fiscal year.

“Our investments in Digital and our efforts in client mining are paying off well. Our strong order bookings in the last two quarters provide us the right foundation to grow as we progress through the year,” Abidali Z Neemuchwala said.

The company has also transfered Rs 486.6 crore towards its share capital from its retained earnings to suffice the bonus issue which was approved by the shareholders earlier.

There wasn't much jubilation for shareholders, as company's board recommended adoption of the interim dividend as the final dividend for the financial year 2017–18. Thus, the total dividend for the financial year 2017–18 remains Rs 1 per equity share, as appoved in January this year.

The company's stocks jumped by 0.05% during the day's trade on BSE to close at Rs 287.2 per scrip.