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Growth was led by revenue growth in IT services wherein rupee revenues grew
Revenue 13,768.6 13,951.4 14,062.1 -2.1 13,669.0 0.7 1.3% sequentially to | 13,411.9 crore while IT products declined 7.3% QoQ
Employee expenses 9,209.4 9,217.1 9,499.2 -3.1 9,069.8 1.5
Key Metrics
Closing employee Count 163,827 165,000 165,481 -1.0 162,553 0.8
TTM voluntary Attrition (%) 16.6 16.0 16.3 30 bps 15.9 70 bps
Utilisation ex trainees (%) 83.4 83.0 84.8 -140 bps 81.9 150 bps
Average $/| 65.0 65.5 68.6 -5.1 65.7 -1.1
Source: Company, ICICI Direct Research
Change in estimates
FY19E FY20E
(| Crore) Old New % Change Old New % Change Comments
Revenue 59,198 57,697 -2.5 64,235 61,931 -3.6
EBITDA 12,156 10,850 -10.7 13,255 11,899 -10.2
EBITDA Margin (%) 20.5 18.8 -173 bps 20.6 19.2 -142 bps
PAT 9,293 8,269 -11.0 10,362 9,412 -9.2
EPS (|) 20.6 18.3 -11.2 23.0 20.9 -9.3 Tweak estimates owing to change in margin estimates
Source: Company, ICICI Direct Research
Assumptions
Current Current Earlier Current Earlier
FY17 FY18E FY19E FY19E FY20E FY20E
Closing employee Count 181,482 191,482 201,482 203,482 211,482 215,482
TTM voluntary Attrition (%) 16.4 16.6 16.0 15.0 15.0 14.0
Utilisation ex trainees (%) 82.3 82.5 84.0 84.0 84.5 85.0
30.0 26.7
24.1 25.0
21.7 22.1 22.5
19.6
20.0
%
The digital business contributed 26.7% to revenue
11.2
(22.1% in Q4FY17) and grew at healthy 9.4%, 27.5% 10.0 9.9 9.4 9.4
QoQ, YoY, respectively. Digital revenue run rate has
4.6 3.7
reached ~US$2 billion in FY18 with strong growth of 2.7
27.2% YoY 0.0
Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18
20
9083
10000
8456
8060
7704
7346
7082
7000
$ million
7.6 7.4 10
5.5
%
7.0 4.9 5.1 5.8 4.9
4.6 3.9 2.1 4.6
4000 3.7 3.5
2062
2014
2013
1971
1955
1931
1916
1903
1000 0
FY15
FY16
Q1FY17
Q2FY17
Q3FY17
Q4FY17
FY17
Q1FY18
Q2FY18
Q3FY18
Q4FY18
FY18E
FY19E
FY20E
Dollar revenue Growth, YoY
[
24
22.1
20.5
21
18.3
17.8 17.8 17.6 17.9 17.3
%
18 16.8
15.8 15.6 16.1
14.8 14.4
15
12
FY18E
FY19E
FY20E
FY15
FY16
FY17
Q1FY17
Q2FY17
Q3FY17
Q4FY17
Q1FY18
Q2FY18
Q3FY18
Q4FY18
EBIT margin (IT services)
10000 9412
8653 8886 8490
8008 8269
7000
| crore
4000
2052 2067 2168 2261 2076 2191 1937 1803
1000
FY18E
FY19E
FY20E
FY15
FY16
Q1FY17
Q2FY17
Q3FY17
Q4FY17
FY17
Q1FY18
Q2FY18
Q3FY18
Q4FY18
PAT
1000
800
600
|
400
200
0
Apr-08
Oct-08
Apr-09
Oct-09
Apr-10
Oct-10
Apr-11
Oct-11
Apr-12
Oct-12
Apr-13
Oct-13
Apr-14
Oct-14
Apr-15
Oct-15
Apr-16
Oct-16
Apr-17
Oct-17
Apr-18
Price 24 20 16 12 8
800 80.0
600 60.0
(|)
(%)
400 40.0
200 20.0
0 0.0
Mar- Apr- Jun- Jul- Sep- Nov- Dec- Feb- Mar- May- Jun- Aug- Sep- Nov- Jan- Feb- Apr- May- Jul- Aug- Oct- Nov- Jan- Feb- Apr-
15 15 15 15 15 15 15 16 16 16 16 16 16 16 17 17 17 17 17 17 17 17 18 18 18
Key events
Date Event
Wipro collaborates with world's leading provider of open source solutions Red Hat to set up a cloud application factory. Using Red Hat OpenShift Container Platform,
Jun-17 Wipro could develop new cloud based applications without having to rewrite their legacy applications
According to media sources, Wipro Infrastructure Engineering, part of Wipro Enterprises Ltd announces a strategic alliance with Israel Aerospace Industries (IAI) to
make composite aerostructure parts and assemblies in India for the global market. Wipro Infrastructure Engineering will set up a manufacturing facility in India in
Jul-17 partnership with IAI to meet the requirements of global aircraft OEMs and Tier-1 suppliers.
Wipro enters into a partnership with Hewlett Packard Enterprise (HPE) to offer IT infrastructure solutions in a consumption-based or pay-per-use business model for
the enterprises. In this partnership, Wipro will leverage HPE Flexible Capacity to offer flexible and scalable IT infrastructure services in a consumption-based IT
Jul-17 model, accelerate growth and enable digital transformation for its customers.
Wipro wins a five year IT applications management contract from Outokumpu, global leader in stainless steel. Wipro would provide applications management
Sep-17 services for Outokumpu SAP landscape along with legacy applications support
Sep-17 Wipro bags a seven year contract from European energy company, innogy SE to manage the data centre and cloud services
Wipro enters into a partnership with CloudGenix, a leading provider of Software defined Wide Area Networking (SD-WAN) products. Under the partnership, Wipro
Sep-17 would offer its customers end to end managed WAN services.
Wipro Digital signs a definitive agreement to acquire Cooper, design and business strategy consultancy. Wipro Digital is the digital business unit of Wipro.
Oct-17 Acquisition is expected to be closed in Q3FY18.
Mar-18 Wipro announces it would pay $8.8 million for a 33% stake in application security company Denim Group, to boost its cybersecurity offerings to clients
Wipro sells 63% of its stake in Wipro Airport IT to Antariksh Softtech for a consideration of ₹ 3.15 crore. Wipro Airport IT Services is a joint venture between Wipro
Apr-18 (74%) and Delhi International Airport Limited (DIAL) (26%).
Source: Company, ICICI Direct Research
Recent Activity
Buys Sells
Investor name Value Shares Investor name Value Shares
ICICI Prudential Asset Management Co. Ltd. 72.8m 16.2m Azim Premji Trust -884.5m -179.7m
UTI Asset Management Co. Ltd. 12.1m 2.7m Premji (Azim Hasham) -73.8m -15.0m
Kotak Mahindra Asset Management Company Ltd. 4.8m 1.1m Azim Premji Philanthropic Initiatives Pvt. Ltd. -22.3m -4.5m
Grantham Mayo Van Otterloo & Co LLC 4.6m 1.0m Stewart Investors -19.7m -4.0m
HDFC Asset Management Co., Ltd. 4.4m 1.0m T. Rowe Price International (UK) Ltd. -18.1m -3.7m
Source: Reuters, ICICI Direct Research
Strong Buy: >15%/20% for large caps/midcaps, respectively, with high conviction;
Buy: >10%/15% for large caps/midcaps, respectively;
Hold: Up to +/-10%;
Sell: -10% or more;
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