Earnings Outlook
Weak demand seen weighing on Wipro's Jan-Mar revenue, PAT
This story was originally published at 21:41 IST on 15 April 2025
Register to read our real-time news.Informist, Tuesday, Apr. 15, 2025
By Arya S. Biju
MUMBAI – Information technology major Wipro Ltd. is expected to have ended the financial year 2024-25 (Apr-Mar) on a weaker note, with the company likely to report modest revenue growth sequentially and a dip in net profit in the March quarter. However, estimates show the IT major is expected to report stronger revenue growth on quarter than its top three industry peers Tata Consultancy Services Ltd., Infosys Ltd., and HCL Technologies Ltd.
India's fourth largest IT company by market capitalisation is expected to report flat to 2.4% sequential growth in revenue for the quarter. According to the average of estimates from 19 brokerages, the company is expected to report a consolidated revenue from operations of INR 226.38 billion for the quarter, up 1.4% on quarter and 1.9% on year.
Softness in the energy, manufacturing, and resources verticals, and in the consulting business, coupled with slower growth in geographies, including Europe, Asia-Pacific, West Asia, and Africa, are expected to weigh on the company's revenue, according to analysts. A weak demand environment, lower billing days, and reduced discretionary spends are also seen affecting the company's top line for the quarter.
In dollar terms, the company is expected to report a revenue of $2.61 billion, unchanged from the previous quarter, according to an average of estimates from 15 brokerages. Its revenue from IT services in constant currency terms is also expected to remain largely flat on quarter, supported by a ramp-up of deals, rupee depreciation, and operating efficiency.
The company's consolidated net profit for the quarter is expected to decline 0.5% sequentially but rise nearly 18% on year to INR 33.38 billion, according to estimates. Of the 19 brokerages, eight expect the company's net profit to increase on quarter in the range of 0.8% to 3.5%, while the rest expect it to fall.
HSBC Global Research had the highest estimate of INR 228.54 billion for Wipro's consolidated sales for the quarter, while Prabhudas Lilladher Pvt. Ltd. had the lowest estimate of INR 223.30 billion. For net profit, JM Financial Institutional Securities Pvt. Ltd. had the highest estimate of INR 34.73 billion and Choice Equity Broking Pvt. Ltd. had the lowest estimate of INR 30.46 billion.
Analysts are also divided on their estimates for the company's operating margin, calculated as earnings before interest and tax margin. While some expect the margin to remain largely flat or improve marginally on quarter led by rupee depreciation tailwinds and cost optimisation, others expect a sequential fall. Though Elara Securities (India) Pvt. Ltd. expects the margins to fall sequentially, the company's ongoing cost rationalisation efforts are seen limiting the extent of the drop.
The EBIT margin is seen in the range of 16.0-17.7%, according to estimates from 15 broking firms. The metric grew 70 bps sequentially to 17.5% in Oct-Dec, outperforming analysts' expectations. The company is expected to report a healthy order intake, with a large-deal total contract value in the range of $1.6 billion to $1.8 billion, according to analysts. This is considering a 10-year mega-deal with the Phoenix Group worth around $661.84 million, Kotak Institutional Equities said. However, Motilal Oswal expects Wipro's deal total contract value to fall 7% in FY25 over FY24.
With increasing worries about a likely recession and the return of uncertainty and slowdown in decision-making in the US, analysts expect Wipro to guide for a (-)1% to 1% revenue growth in constant currency terms for the June quarter.
The IT bellwether will report its earnings for the March quarter Wednesday and investors will keenly watch the management commentary on the impact of macroeconomic headwinds on decision-making and revenue conversion cycle, and updates on consultancy business and deal execution. Investors will also look for commentary on growth recovery in the energy, manufacturing, and resources verticals and regions such as Europe, analysts said.
Tuesday, shares of the company closed at INR 244 on the National Stock Exchange, up 1.8% from the previous close. The stock has fallen close to 19% since the announcement of the December quarter earnings on Jan. 17.
Following are the Jan-Mar earnings estimates for Wipro based on reports from 19 brokerage firms in descending order of the estimate of net profit:
| Broking Firm |
Net Profit (in INR million) |
Net Sales (in INR million) |
Revenue (mln $) | ?IT margin | |
| JM Financial Institutional Securities Pvt. Ltd. | 34,725.00 | 227,761.00 | 2,626.00 | 17.3 | |
| InCred Research Services Pvt. Ltd. | 34,632.00 | 227,675.00 | 2,619.00 | 17.5 | |
| Nirmal Bang Equities Pvt. Ltd. | 34,589.00 | 224,380.00 | 2,640.00 | 16 | |
| Kotak Institutional Equities | 34,109.00 | 227,518.00 | 2,614.00 | 17.6 | |
| Equirus Securities Pvt. Ltd. | 34,087.00 | 226,340.00 | -- | -- | |
| IDBI Capital Market Services Ltd. | 34,024.00 | 225,101.00 | 2,596.00 | 17 | |
| Sharekhan Ltd. | 33,940.00 | 227,012.00 | 2,613.00 | 17.6 | |
| Emkay Global Financial Services Ltd. | 33,821.00 | 226,591.00 | -- | -- | |
| HDFC Securities Ltd. | 33,530.00 | 226,720.00 | 2,614.00 | 17.4 | |
| Systematix Shares and Stocks (India) Ltd. | 33,495.00 | 226,710.00 | 2,616.00 | 17.5 | |
| Prabhudas Lilladher Pvt. Ltd. | 33,400.00 | 223,300.00 | 2,600.50 | 17.7 | |
| ICICI Securities Ltd. | 33,349.00 | 227,711.00 | 2,627.00 | 17.5 | |
| Indsec Securities and Finance Ltd. | 33,100.00 | 226,800.00 | 2,600.00 | 17.3 | |
| Motilal Oswal Financial Services Ltd. | 33,000.00 | 227,000.00 | 2,608.00 | 17.5 | |
| Elara Securities (India) Pvt. Ltd. | 32,803.00 | 226,053.00 | 2,615.00 | -- | |
| PhillipCapital (India) Pvt. Ltd. | 32,530.00 | 225,887.00 | 2,598.00 | 17.3 | |
| Nuvama Wealth Management Ltd. | 32,332.00 | 224,914.00 | -- | -- | |
| HSBC Global Research | 32,279.00 | 228,539.00 | 2,636.00 | 17.3 | |
| Choice Equity Broking Pvt. Ltd. | 30,463.00 | 225,188.00 | -- | 16.9 | |
| Average | 33,379.37 | 226,378.95 | 2,614.83 | -- |
End
US$1 = INR 85.77
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Rajeev Pai
For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.
Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.
Informist Media Tel +91 (22) 6985-4000
Send comments to feedback@informistmedia.com
© Informist Media Pvt. Ltd. 2025. All rights reserved.
To read more please subscribe
Share this Story:
