IT services major Wipro reported a 21 per cent growth in the second quarter of the fiscal, which was better than estimates.
The company also declared a bonus issue in the ratio of 1:1.
Wipro recorded a net profit of ₹3,208.8 crore in the second quarter (July-September) up from ₹2,646.3 crore in the year-ago period.
Ahead of the numbers, analysts were pencilling its net profits at around ₹3,100 crore.
Wipro’s revenues were also marginally ahead of estimates at ₹22,301.6 crore but lower than ₹22,515.9 crore a year ago.
However, Wipro’s guidance for the next quarter was a disappointing element.
Wipro said that revenue from its IT services business will be in the range of $2,607-2,660 million which translates to a sequential decline of up to 2 per cent or flat in constant currency terms.
During the second quarter, its IT services segment revenue stood at $2,660.1 million, an increase of 1.3 per cent over the preceding three months and a decrease of 2 per cent over the previous year period.
The lower forecast led to its ADRs falling 2 per cent on Thursday.
“Based on strong execution in the second quarter, 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,” Srini Pallia, CEO and managing director, said.
“We grew in three out of four markets as well as in BFSI (banking, financial services and insurance), consumer and technology & communications sectors,” Pallia said.
On the lower revenue guidance for the October-December quarter, Pallia said Wipro expects its performance to be affected by “seasonal furloughs and fewer working days”.
“As a result, we are guiding a sequential revenue growth of -2 per cent to 0 per cent in constant currency. Despite softness in revenue in the third quarter, we are confident of maintaining our margin in a narrow band,” he said.
Total bookings rose 5.9 per cent to $3.6 billion an increase of 5.9 per cent.Operating margins stood at 16.8 per cent against 16.5 per cent on a sequential basis.
