Wipro - 3QFY2014 result - Angel Broking

Views of Ms. Ankita Somani (Research Analyst -IT, Angel Broking) on Wipro - 3QFY2014 results:

"For 3QFY2014, Wipro results were broadly inline with our estimates on all the broader fronts. The IT services revenue came in at US$1,678.4mn, up 2.9% qoq vs. expectation of ~2.8% qoq growth. Revenue growth during the quarter was broad based. At the consolidated level, Wipro's revenue came in at Rs. 11,332cr, up 3% qoq. During 3QFY2014, Wipro's IT services EBIT margin grew by ~50bp qoq (after growth of ~250bp qoq in 2QFY2014) to 23.0%. On the consolidated level, EBIT margin grew by ~27bp qoq to 20.7%. PAT came in at 2,027 (estimate - Rs. 2,022cr), up 4% qoq.

The company added 42 new clients during the quarter and the active clients increased to 966 from 942 in 2QFY2014. Also, utilizations remained almost flat sequentially at 66.0%. For 4QFY2014, the management has given a USD revenue guidance of US$1,712mn-1,745mn, which translates into a qoq growth of ~2-4% which is higher than our estimate of 1.5-3% and shows a sign on stability as well as consistency in terms of revenues. We believe that the initial signs of gains from restructuring initiatives have started showing and expect Wipro to do well in the quarters ahead. We currently maintain our positive view on the stock and wait for management commentary on discretionary spending and large deal wins."

Source : Equity Bulls

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