Wipro Q2FY25 Results: Revenue Growth and Bonus Shares Announced

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Wipro Q2FY25 Results: Revenue Growth and Bonus Shares Announced

Wipro reports 0.6% QoQ growth in constant currency, the first increase after 6 quarters of decline.

October 17th, 2024 News

Wipro Ltd. has reported its Q2FY25 earnings, showcasing revenue growth for the first time in six quarters. The IT services giant also announced a significant bonus share issuance to its shareholders, highlighting a strong performance and a positive outlook.

Key Financial Highlights:

Constant Currency Revenue Growth: Wipro saw a 0.6% growth QoQ in constant currency terms, marking its first revenue growth after six quarters of decline.
US Dollar Revenue: The company's revenue for the September quarter stood at $2,660 million, slightly above the market expectation of $2,651 million.
Rupee Revenue: Wipro reported a 1.3% rise in rupee terms, aligning with CNBC-TV18’s forecast.
EBIT (Earnings Before Interest & Tax): EBIT for the quarter was ₹3,732 crore, reflecting a 3.5% growth from the previous quarter and higher than the projected ₹3,666 crore.
EBIT Margin: The margin stood at 16.8%, exceeding expectations of 16.5%.

Large Deal Bookings:

Wipro achieved large deal bookings of $1.5 billion, the highest in 10 quarters, reinforcing its ability to secure substantial business amidst challenging conditions.

Bonus Shares Announcement:

The board declared a 1:1 bonus share issue, meaning shareholders will receive one free share for every share held as of the yet-to-be-announced record date.
The bonus shares are expected to be credited by December 15, 2024.
This is Wipro’s first bonus share issuance since 2019, marking the 14th bonus share issue in the company’s history.

Operational Highlights:

Margin Expansion: Wipro expanded its margins by 35 basis points, driving its Earnings Per Share (EPS) growth by 6.8% QoQ.
Strong Cash Flow: The company generated 132.3% of net income in operating cash flow, reflecting robust cash flow performance. In the first half of FY25, Wipro's operating cash flow reached nearly $1 billion.

Outlook for Q3FY25:

Wipro forecasts revenue between $2,607 million and $2,660 million for Q3FY25, reflecting an expected range of -2% to 0% QoQ.

Promoter Holding and Stock Performance:

Promoters hold a 72.80% stake in the company as of the September quarter.
Wipro’s stock closed at ₹528.70, down by 0.65% on the day of the results announcement. The stock has seen a growth of nearly 11% in 2024.

With strong deal wins, improved margins, and solid cash flow, Wipro's Q2 results reflect an optimistic turnaround after several challenging quarters. The bonus share issuance adds further value for long-term investors, marking a significant milestone for the company.