Wipro has reported total income of Rs 4.25 bn (up 27% YoY) and a net profit of Rs 480 mn (up 87% YoY) for the quarter ended 30th June 1999.
Wipro Limited, a part of the Wipro Corporation, is engaged in the businesses of information technology, financial services, health care systems, lighting and hydraulic products. Its infotech division is the premier personal computer and peripherals supplier in the country, and the second largest software service provider.
The company's software and services division has recorded a 51% growth in terms of revenues at Rs 2 bn, while the EBIT grew at a modest 22%. The systems and services division raked in revenues of Rs 1.3 bn (up 20%) and recorded its first operating profit at Rs 21 mn. The Consumer care and lighting division, revenues fell 9% at Rs 700 mn while the operating profit jumped to Rs 100 mn.
The jump in profits is due to the turnaround at the systems and services division and the improved performance of the other divisions. Wipro has recently launched a whole range of computers and this indicates that the company is likely to increasingly focus on this division. However, the systems and services business is extremely competitive the company might find it difficult to consistently earn higher margins.
The operating profits at the software division have grown only 22% vis a vis the 51% growth in revenues. The consumer care division has posted higher profits on lower sales revenues, thus contributing to the remarkable rise in profits (up 87%) during the quarter.
As analysts are of the view that the company is fully valued they have rated the stock as a 'HOLD'.
LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.
SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.
Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India. Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: email@example.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407