Q2 Result: Comparison between Wipro and HCL Tech
A mixed quarter for Wipro; net profit drops 9% from last year
Insights into Wipro's Q2 results:
During the September quarter of FY 2021-2022, Wipro's consolidated profit was Rs 2,931 crore, compared with Rs 2,659 crore in FY 2022-2023. Therefore, profits declined in the September quarter. Annual profit for the company has fallen 9.27 percent.
According to the company's September quarter financial results; consolidated income grew to Rs 22,540 crore from Rs 19,667 crore. Additionally, the company's IT services income increased from Rs 19,380 crore in September 2022 to Rs 22,363 crore. The September quarter revenue in dollars decreased from $285 million to $281 million.
On a quarter-over-quarter basis, the company's operating margin increased by 0.16 percent to 15.1%, while its attrition rate stood at 23.5%. Meanwhile, dollar earnings increased from $ 2735 million to $ 2797 million.
On a quarter-on-quarter basis, the company's EBIT margin rose from 15 percent to 15.11 percent, while EBIT grew from Rs 3,183.2 crore to Rs 3,380.1 crore.
The stock is at a 52-week low
On Wednesday (October 12, 2022) Wipro announced its September 2022 results (Q2FY23). It saw a sharp decline in early trade on Thursday (October 13). Over 7 percent had been lost by noon. On the BSE, the stock hit 378.80. On 12 October 2022, it closed at Rs 407.75. This is the stock's biggest drop this year.
How did it come about?
·??????Growth prospects are encouraging, but valuations are supportive.
·??????There was a reduction in guidance from 1-3% to 0.-2%.
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·??????The management of the company acknowledges that the consulting business has slowed down.
·??????The impact of the company's initiatives on salary hikes and promotions was seen in the second quarter. Margin management remains challenging, however.
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HCL Tech Q2 Result:
HCL Technologies announced its second-quarter financial results for the year 2022-23. In the July-September quarter, the company's consolidated net profit grew 7 percent. A profit of Rs 3,489 crore was achieved by HCL Technologies during the period. In the July-September quarter of the last financial year, HCL made a net profit of Rs 3,259 crore.
Profit up 19.5%: In the July-September quarter, the Company's revenue increased by 19.5% to Rs 24,686 crore. Between July and September, the company hired 8,359 freshers, increasing its workforce to 219,325. 23.8% of the workforce quit in the second quarter.
Enhanced Revenue Guidance for FY23: HCL TECH has given tremendous revenue growth guidance for FY23. The company estimates that CC revenue growth in FY23 will range from 13.5 to 14.5 percent. Prior to that, the company had kept the growth forecast at 12-14 percent. At the same time, it has reduced its estimate of EBIT margin from 18-20 percent to 18-19 percent.
Dividend: HCL Technologies announced a dividend of Rs 10 per equity share for the financial year 2022-23. HCL Tech's CEO, C Vijayakumar, stated that the company's bookings and pipeline are strong, which bodes well for future growth.
The impact on the shares: Stock prices reacted positively to HCL's excellent quarter-end results today as well. Its shares today rose 3.77 percent to Rs 989.05 in trading on October 13. However, after this, it declined slightly due to profit booking. At the end of the day, its shares closed at Rs 981.90. Its market cap is Rs 2,58,245.94 crore.
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