The company posted net profit of Rs 1716.4 crore as compared to Rs 1456.4 crore in the corresponding period a year ago. Sequentially, profit grew 6.5%.
The company's consolidated revenue grew 10.27% to Rs 10,989 crore from Rs 9965 crore a year ago.
Wipro's IT services business posted revenue of $1577 billion, a growth of 2.4% sequentially and 4.8% compared to the year-ago period. In rupee terms, revenue grew 13% year-on-year to Rs 8602 crore.
The IT services arm posted earnings before interest and tax (EBIT) of Rs 1792 crore ($327 million), a 13% increase year-on-year. The company said the operating income to revenue margin for IT services was 20.8% for the quarter, an increase of 0.1% sequentially.
Wipro's IT Services arm contributed to 78% of total revenue and 92% of operating income for the quarter ended December, the company said.
“We have seen broad based growth in the quarter with all our verticals growing sequentially. Our improvement in customer and employee engagement is reflected in client mining with 10 customers contributing more than $100 million and lower attrition,” said T K Kurien, Executive Director and Chief Executive Officer, IT Business. The IT business added 50 new customers during the quarter.
“We have expanded operating margins sequentially through improvements in revenue productivity and improved cash flow generation through efficient working capital management,” said Suresh Senapaty, Executive Director and Chief Financial Officer of Wipro.
The company said that it expects revenues from IT services business to be in the range of $1,585 million to $1,625 million for the quarter ending March 31.
Shares of Wipro were trading at Rs 414.25, down by 3.91% on the BSE, as of 9.55 am on Friday.
Wipro's Q3 net up 18pc to Rs 1,716.4 cr
(PTI): Wipro Q3 net up 18%; softer guidance pulls scrip down 8%
Bangalore, Jan 18 (PTI) Country's third largest software services firm Wipro today beat market expectations by posting 18 per cent gain in net profit at Rs 1,716 crore for October -December quarter, but said it remains cautious even though global economic factors are stabilising.
Wipro scrip fell 7.88 per cent to close at Rs 397.15 on the BSE, which some analysts attributed to "soft" guidance.
"Wipro reported results soft on revenue but stronger on margin than expectation. Guidance looks softer than what consensus might be expecting," according to a Prabhudas Lilladher report.
Revenues of the Bangalore-based firm rose 10 per cent to Rs 11,025 crore for the third quarter of 2012-13 fiscal, from Rs 9,965.1 crore in the same period of last fiscal.
The IT services revenue, which accounted for 78 per cent of total revenues, stood at USD 1.577 billion (Rs 8,602 crore in rupee terms) in the quarter, up 4.8 per cent year-on-year and 2.4 per cent compared to July-September 2012 quarter.
Wipro expects revenues from IT services business to be in the range of USD 1.585 billion to USD 1.625 billion for the quarter ending March 31.
In constant currency, the IT services revenue for the October-December quarter, at USD 1.571 billion, "was within our guidance range of USD 1.560 billion to USD 1.590 billion", Wipro said.
"While the overall mood on economic growth continues to be muted, global corporations continue to leverage technology to drive revenues and productivity... Overall, economic factors are stabilising globally," Chairman Azim Premji told reporters here.
He added that the US economy is showing some improvement with increase in retail and consumer demand and stability in unemployment rate, while Europe is steady and global leaders he spoke to are now more confident on the business environment than they were two-three months ago.
The US and Europe account for more than 75 per cent of India's IT outsourcing revenue.
Though the company remains positive on demand environment in the quarters ahead, it expressed uncertainty on execution and ramp-ups of new projects.
"It has become a little more positive. That's the good news," Wipro Executive Director and CEO (IT Business) T K Kurien said.
"The bad news is that from our perspective we see two challenges. One, we see the fiscal cliff talks still continuing and we don't know when finally the budgets would come in. And, what it would mean in terms of buying in this quarter," he added.
Kurien further said: "From our own perspective, we have picked in a little bit on caution in our guidance so that we don't kind of fall short in case the environment turns negative."
The New York Stock Exchange-listed company's results are in line with its larger peers - TCS and Infosys - which saw revenues rising 21.7 per cent and 12.1 per cent for the October-December quarter, respectively.
"We have seen broad-based growth in the quarter with all our verticals growing sequentially... Utilities and energy continue to be best performing verticals and it has seen deal closures there and in some other sectors like healthcare," Kurien said.
Wipro's IT services segment had 1,42,905 employees as of December 31, 2012, an increase of 2,336 people in the quarter.
It added 50 new customers in the reported quarter.
Wipro's Executive Director and CFO Suresh Senapaty said: "We have expanded operating margins sequentially through improvements in revenue productivity and improved cash flow generation through efficient working capital management."
The company's IT products segment recorded revenue of Rs 997 crore for the quarter, a year-on-year increase of 11 per cent, while consumer care and lighting business segment posted Rs 1,028 crore, a gain of 17 per cent year-on-year.
Both businesses contribute about nine per cent each to its total revenue.
In November, the company had announced demerger of its non-IT businesses like Consumer Care & Lighting into a new company to focus exclusively on information technology.
Premji also welcomed the deferment of GARR and implementation of recommendations of the Rangachary Committee, which has dealt with the tax disputes the industry has been facing.
Wipro Outlook: Demand environment better but unsure about IT budgets, says Wipro
Country's third largest software services provider Wipro today said notwithstanding the improvement in demand scenario, there is still uncertainty over IT budgets for the next fiscal.
"There has been a big change in just the environment itself, it has become a little more positive. That's the good news.
"The bad news is that from our perspective we see two challenges - one is that we see the fiscal cliff talks still continuing and we don't know when finally the budgets would come in and what it would mean in terms of buying in this quarter," Wipro IT Business Executive Director and CEO T K Kurien said.
Wipro registered a 18 per cent jump in net profit and 10 per cent increase in revenues in the October-December 2012 quarter.
The IT services revenue, which accounted for 78 per cent of its revenues, stood at USD 1.577 billion (Rs 8,602 crore) in the reported quarter, meeting its guidance of USD 1.560 billion to USD 1.590 billion for the quarter.
Wipro expects its revenues from IT services business to be in the range of USD 1.585 billion to USD 1.625 billion for the quarter ended March 31, 2013.
"Traditionally Q4 has been a strong quarter for us. The other little bit of concern that we have factored in (in the guidance) is that there are a lot of projects that we won last quarter... when execution will start, when ramp ups will begin? I think that is what we have factored in the guidance," Kurien said.
He added that the company has "picked in a little bit on caution" on its guidance so that it does not "fall short in case the environment turns negative".
While Wipro joined larger rivals TCS and Infosys in posting strong profit numbers, its shares tanked eight per cent to finally close 7.88 per cent lower on account of the "soft" guidance.
"Wipro reported results soft on revenue but stronger on margin than expectation. Guidance looks softer than what consensus might be expecting," a Prabhudas Lilladher report said.
Dipen Shah, Head (Private Client Group) Research at Kotak Securities said the company's volume performance is much lower than that reported by peers. "We expect the stock to attract better valuations once volume growth starts improving," he added.
Economic uncertainty has led clients in the US and Europe to invest cautiously on IT. These markets together account for more than 75 per cent of India's IT sector business.
"The overall demand environment has not changed much over the last three months. We see momentum in certain areas and certain other areas continue to remain challenged," Wipro Chief Financial Officer Suresh Senapaty said.
However, reports by research firm Gartner forecast global IT services spending to increase 5.2 per cent to USD 927 billion this year, compared with growth of 1.8 per cent in 2012.
TCS, Infosys and HCL Technologies, which have announced their quarterly earnings over the last two weeks, have also indicated that IT budgets are likely to be flat or slightly higher this year.
Wipro joins Infosys, Tata Consultancy in beating profit forecasts
Jan 18 (Reuters): India's No.3 software services provider Wipro Ltd posted an 18 percent gain in quarterly profit, joining bigger rivals Tata Consultancy Services Ltd and Infosys Ltd in reporting better-than-expected earnings.
Wipro, whose customers include Apple Inc and BP PLC , said net profit for the three months ended December rose to 17.16 billion rupees ($316 million) from 14.56 billion rupees a year earlier. That compares with the average estimate of 16.45 billion rupees in a poll of 20 analysts, according to Thomson Reuters data.
Strong third-quarter results by Infosys, Tata Consultancy and HCL Technologies Ltd have led investors to anticipate more good news from the industry. Even before Wipro announced its earnings, UBS on Thursday upgraded its stock to 'buy' from 'sell,' confident that the software services export sector is headed for a recovery.
"We have seen broad-based growth in the quarter with all our verticals growing sequentially," T.K. Kurien, chief executive of Wipro's IT business, said in a statement on Friday.
Economic uncertainty had led to concerns that clients in the United States and Europe, which account for more than 75 percent of India's IT outsourcing revenue, will continue to hold back on IT spending.
Research firm Gartner now says worldwide IT services spending will rise 5.2 percent to $927 billion in 2013, compared with growth of 1.8 percent in 2012.
In the quarter ended December, Wipro's IT business revenue in dollar terms rose 2.4 percent from the September quarter to $1.577 billion, meeting its own guidance of 1.2 to 3.5 percent.
For the three months ending March, Wipro said IT business revenue will be between $1.585 billion and $1.625 billion, or a sequential gain of 0.5 percent to 3 percent. That compares with analysts' expectations of a 1 percent to 3.5 percent increase.
Shares at Wipro, valued at $19 billion, have risen about 9 percent so far this year, compared with a 2 percent increase in the broader index.
In November, Wipro said it would fold its non-IT units into a separate privately held company called Wipro Enterprises in a bid to boost profitability.
The listed company would focus exclusively on the IT business, which accounted for 86 percent of Wipro's revenue and 94 percent of operating profit. Wipro expects this process to be completed by April.
Stocks More on Wipro Ltd
Company INFO More on Wipro Ltd