Wipro announced its earnings for the Q4FY18 quarter after market hours and it was disappointing.
In early April itself Wipro has issued a warning that its earnings for Q4FY18 will show a drop – it had pegged the impact at 65-75 bps as its telecom client (Aircel) was going through insolvency proceedings.
But the drop in profit was more than that. It ended the quarter with a 20% (YoY) and 7% (QoQ) drop in consolidated net profit at Rs.1800 crore. Consolidated total income of Wipro slipped marginally 0.05% (QoQ) at Rs.14,305 crore.
With respect to the insolvency client, the company has made provisions of Rs 208 crore for Q4FY18 v/s Rs.525 crore in previous Q4.
Regarding future estimates, Wipro stated in the issued Press Release, “We expect Revenue from our IT Services business to be in the range of $2,015 million to $2,065 million*. We had announced the divestiture of our hosted data center services business to Ensono for a consideration of $405 million. We expect the transaction to complete during the quarter ending June 30, 2018. For the purpose of the Outlook, we have not considered the impact of the divestment on the Revenue for the quarter ending June 30, 2018. We will revise the Outlook for the quarter based on the actual date of completion of the divestment.”
The stock is amongst the top losers on the BSE today morning, It went down to Rs.274.10 v/s yesterday’s close of Rs.287.20. Its 52-week high and low is at Rs.334.75 and Rs.244.33 respectively.