Quarterly Update
published on Oct 29, 2018
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:
Q2 FY19: a better performance than Q1, boosted by the Alight deal. Takes further actions to address specific longstanding issues
- Revenue growth beat (currency adjusted) guidance, boosted by the start of the Alight deal, in spite of several ongoing headwinds, including two client bankruptcies and ongoing uncertainties related to ACA reform impacting the HPS business, which has new leadership
- We estimate revenues from digital growing y/y at >30%.
- Ongoing restructuring of the India business: has now carved out the India government business, which will improve the financial profile of the remaining India business
- Excluding a litigation settlement, operating margin increasing y/y, benefiting from several margin levers.
- Client mining continues to improve.
Largest deal signing to date
The 10-year contract with Alight has a LTV of $1.5bn to $1.6bn, making it Wipro’s largest single award to date. It also provides Wipro with a potential opportunity go to market outside North America with a multi-process HRO offering.