Wipro keeps up investors' faith in the IT big three: Q2 net up 46 per cent

Rex Mathew
17 October 2006

Wipro Limited, the third largest IT services company, has followed the lead from Infosys and TCS and has declared better than expected results for the second quarter. Further improvement in operating margins in the BPO business helped the company to maintain overall margins.

For the quarter ended 30 September, 2006, Wipro has reported a consolidated net profit of Rs700.22 crore, or Rs4.84 per share, an increase of 46.49 per cent over Rs478 crore, or Rs3.36 per share, reported for the previous year quarter. On a sequential basis, net profits have gone up 12.87 per cent from Rs620.39 crore for the previous quarter ended June 2006.

Consolidated operating revenues have increased 42.64 per cent to Rs3,557.6 crore from Rs2,494.09 crore for the previous year quarter. Sequentially, revenues have increased 11.41 per cent from Rs3,193.39 crore for the previous quarter.

Global IT revenues have increased 44 per cent year-on-year and 11.02 per cent sequentially. Domestic IT services and product revenues have increased 36 per cent as compared to previous year quarter and 18.89 per cent from the previous quarter while revenues from consumer care & lighting has gone up 41 per cent year-on-year and 14.54 per cent sequentially.

Within global IT solutions, enterprise solutions contributed 58.6 per cent of revenues, 33 per cent came from technology solutions and the balance 8.4 per cent from BPO services.

Overall operating margins remained steady at 24 per cent on a year-on-year basis, but declined modestly from 25 per cent reported for the previous quarter. Among various divisions, IT services maintained the operating margin at 26 per cent - both sequentially and on a year-on-year basis.