Wipro Q4 dollar revenue seen at $1938.5 mn; may estimate Q1 topline growth at 0-2%

IT services provider Wipro is expected to report dollar revenue growth within its guidance range for January-March quarter. IT services revenue in dollar terms may grow 1.87 percent sequentially to USD 1,938.5 million from USD 1,902.8 million, according to average of estimates of analysts polled by CNBC-TV18.

The company had estimated dollar revenue growth at 1.8-1.9 percent and 1-1.5 percent growth in constant currency for the quarter ended March 2017.

Revenue may be boosted by 2 months benefit of Appirio that acquired in October for USD 500 million.

Rupee revenue during the quarter may fall 0.8 percent quarter-on-quarter to Rs 13,090 crore while EBIT (earnings before interest and tax) is seen declining 3.7 percent to Rs 2,324 crore and margin may shrink 55 basis points to 17.75 percent compared with previous quarter, hit by rupee appreciation and lower margin from Appirio.

According to analysts, Wipro may forecast dollar revenue growth at 0-2 percent for first quarter of current financial year 2017-18.

Wipro began restructuring in the India business (that contributes around 5 percent to revenue) in Q2FY17, which is expected to last until Q1FY18. Revenue from India & Middle East has declined for 3 straight quarters and the company is unwinding unprofitable government contracts.

One can watch out for a recovery in energy vertical (which contributes around 13 percent to revenue) that has been subdued for the last few quarters.