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Wipro Q4 consolidated PAT rises 4% QoQ, attrition hits margins

The Bengaluru-based company's consolidated revenue from operations rose merely 0.3 percent on-quarter.

Mumbai / April 29, 2022 / 04:47 PM IST
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Information technology major Wipro on April 29 reported a 4 percent sequential rise in its consolidated net profit at Rs 3,087.3 crore for the quarter ended March, which was in line with analysts' expectations.

The Bengaluru-based company's consolidated revenue from operations rose merely 0.3 percent on-quarter to Rs 20,860.7 crore for the reported quarter.

"We have had an outstanding year, finishing with $10.4 billion in revenues, and an industry-leading growth of 27% year-on-year. This is our sixth straight quarter of strong revenue growth at or over 3%," Thierry Delaporte, chief executive officer, and managing director said in a statement.

Firm Outlook

The IT services major indicated that its revenues in the June quarter will come in at $2.74-$2.80 billion, implying a sequential growth of 1-3 percent.

In the reported quarter, Wipro said its IT services revenues jumped 3.1 percent on a sequential basis to $2.7 billion.

"With all markets, sectors, and Global Business Lines now growing in double-digits year-on-year, we have a strong foundation for next year’s growth," Delaporte added.

Most regions including North America, Europe, and Asia contributed to the sturdy topline growth of the company. During the quarter, the IT services company added two new clients in the $100 million-plus category and three in the $50 million-plus basket.

Weak operating show

That said, the operating performance of the company continued to suffer because of the high cost of retaining staff at the company. The sector-wide crunch for talent has resulted in a sharp revision in the wages of IT professionals over the past 12 months.

The company reported a decline in consolidated operating profit by 1.2 percent on-quarter to Rs 3,511 crore.

Wipro reported a consolidated operating margin of 17 percent for the quarter ended March as against 17.6 percent in the previous quarter.

Attrition hits margins

The compression in margins is a direct result of wage hikes undertaken by Wipro. The company's annualised attrition rate in the quarter was 23.8 percent as against 22.7 percent in the previous quarter.

Net utilisation of staff also suffered during the quarter as it fell to 85.2 percent from 85.8 percent in the previous quarter, largely due to higher composition of freshers in the employee mix.

On April 29, shares of Wipro ended 2.8 percent lower at Rs 508 on the National Stock Exchange.

Moneycontrol News
first published: Apr 29, 2022 03:58 pm