Wipro Q3 profit at Rs 2,015 crore, meets Street estimates

India's fourth largest IT services exporter Wipro on Friday reported encouraging numbers for the quarter ended December 2013. They suggested the company was bouncing back after lagging rivals for many quarters.

Wipro grew its sequential dollar IT revenues to $1.67 billion - a 2.9 per cent rise, and the highest growth the company has posted in eight quarters.

The growth number nearly matched larger rival TCS 's 3 per cent growth for the quarter, met its own guidance given at the end of the last quarter and was in line with Street estimates. The company's growth was led by healthcare, life sciences and services which grew 7.6 per cent, and energy, natural resources and utilities which rose 4.8 per cent. Infrastructure services rose 5.6 per cent.

The company's profits grew to Rs 2,015 crore or Rs 8.18 a share compared to Rs 1,932 crore or Rs 7.85 per share in the previous quarter. Wipro's operating margins improved to 23 per cent from 22.5 per cent in the previous quarter with the company having invested in more automation and driven up efficiencies.

Wipro now expects its IT Services business to be in the range of $ 1.71 billion to $1.74 billion in the March quarter.

"As the global economy is progressing towards stability, we see optimism amongst clients, especially in the West. Corporations are leveraging technology to reduce operational costs and investing resources in differentiating themselves in the marketplace," Azim Premji, Chairman of Wipro, said.

Analysts seemed happy with the results. "They are in line with expectations. The margins are higher than we expected. We can fairly say that the company is on an improvement trail. The commentary is confident too," Sanjeev Hota, analyst with brokerage house Sharekhan said.

The Wipro stock closed 3.15 per cent down on the BSE at Rs 552.45. The BSE Sensex was at 21,063.62, down 0.95 per cent. Wipro declared results after the markets had closed.