Quarterly Update
published on Apr 27, 2017
Report Overview:
NelsonHall’s Quarterly Update on Wipro's provides a snapshot of developments at Wipro in the last quarter.
Who is this Report for:
NelsonHall’s Quarterly Update on Wipro provides a snapshot of developments at the company in the last quarter. It accompanies NelsonHall’s more comprehensive Key Vendor Assessment program.
Both programs are designed for:
- Marketing, sales and business managers developing strategies to target service opportunities within the BPO/IT Services markets
- Sourcing managers monitoring the capabilities of existing suppliers of IT and BPO services and identifying vendor suitability for these services
- Consultants advising clients on vendor selection
- Vendor marketing, sales and business managers looking to benchmark themselves against their peers
- Financial analysts and investors specializing in the BPO/IT services sector.
Scope of this Report:
The report provides a quarterly update on Wipro, looking at financial performance and key developments during the period.
It accompanies NelsonHall’s Key Vendor Assessment program which looks at Wipro’s IT and BPO offerings, capabilities, and market and financial strengths, including:
- Identification of the company’s strategy, emphases and new developments
- Revenue breakdowns
- Analysis of the company’s offerings and key service components
- Analysis of the profile of the company’s client base including the company’s targeting strategy and examples of current contracts
- Analysis of the company’s strengths, weaknesses and outlook.
Key Findings & Highlights:
Q4 FY17 Performance: Soft quarter, as expected. CC growth continues to soften, in spite of a full quarter’s contribution from Appirio. EBIT margin continues to decline y/y.
If we exclude BPS (and the acquired HPS unit) and Appirio, we estimate IT services revenues were broadly flat y/y on a constant scope basis.
Operating margin continues to decline y/y. A number of factors in play here, including margin dilutive acquired businesses.
Progress against six strategic pillars
- Digital: claims “total digital ecosystem” revenues represented 22.1% of total revenues in Q4
- Client mining: efforts to strengthen client mining have yet to translate into significant growth in large accounts
- Non-linearity/ hyper automation: Continuing to scale the deployment of instances of HOLMES. In FY17 generated productivity of over 12k people
- Localization: continues to hire locally in the U.S. for its onshore delivery centers. The acquisition of Info Server brings in a beach-head in Brazil for FS sectors
- Partner eco-system: Wipro Ventures expects to maintain the pace of investments made in 2016.
Restructuring of India and Middle East Business
TK Kurien steps down