Wipro Ltd 6-K, filed Jul 22, 2020
Wipro Ltd (WIT)
About this 6-K
Wipro Ltd filed this 6-K on July 22, 2020.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
Form 6-K
Report ofForeign Private Issuer
Pursuant to Rule 13a-16 or15d-16
under the Securities Exchange Act of 1934
For the month of July 2020
Commission File Number 001-16139
Wipro Limited
(Exactname of Registrant as specified in its charter)
NotApplicable
(Translation of Registrant’s name into English)
Karnataka, India
(Jurisdiction of incorporation or organization)
Doddakannelli
SarjapurRoad
Bangalore, Karnataka 560035, India+91-80-2844-0011
(Address of principal executiveoffices)
Indicate by check mark whether the registrant files or will file annual reports under cover Form 20-F or Form 40-F:
Form 20-F ☒ Form 40-F ☐
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(1):
Yes ☐ No ☒
Note: Regulation S-T Rule 101(b)(1) only permits the submission in paper of a Form 6-K if submitted solely to provide an attached annual report to security holders.
Indicate by check mark if the registrant is submitting the Form 6-K in paper as permitted by Regulation S-T Rule 101(b)(7): Yes ☐ No ☒ ****
Note: Regulation S-T Rule 101(b)(7) only permits the submission in paper of a Form 6-K if submitted to furnish a report or other document that the registrant foreign private issuer must furnish and make public under the laws of the jurisdiction in which the registrant is incorporated, domiciled or legally organized (the registrant’s “home country”), or under the rules of the home country exchange on which the registrant’s securities are traded, as long as the report or other document is not a press release, is not required to be and has not been distributed to the registrant’s security holders, and, if discussing a material event, has already been the subject of a Form 6-K submission or other Commission filing on EDGAR.
DISCLOSURE OF RESULTS OF OPERATIONS AND FINANCIAL CONDITION
We hereby furnish the Commission with copies of the following information concerning our public disclosures regarding our results of operations for the quarter ended June 30, 2020. The following information shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
On July 14, 2020, we announced our results of operations for the quarter ended June 30, 2020. We issued a press release announcing our results under IFRS, a copy of which is attached to this Form 6-K as Item 99.1.
On July 14, 2020, we held a virtual press conference to announce our results. The presentation made by the registrant at the press conference is attached to this Form 6-K as Item 99.2.
We placed advertisements in certain Indian newspapers concerning our results of operations for the quarter ended June 30, 2020 under IFRS. A copy of the form of this advertisement is attached to this Form 6-K as Item 99.3.
We made available on our website the Condensed Consolidated Interim Financial Statements as of and for the three months ended June 30, 2020 under IFRS. A copy of such financial statements is attached to this Form 6-K as Item 99.4.
We filed with stock exchanges in India a statement of statutorily audited consolidated financial results for the three months ended June 30, 2020 under IFRS. A copy of such financial statements is attached to this Form 6-K as Item 99.5.
We filed with stock exchanges in India a datasheet containing operating metrics for the quarter ended June 30, 2020. A copy of such data sheet is attached to this Form 6-K as Item 99.6.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly organized.
| WIPRO LIMITED |
|---|
| /s/ Jatin Pravinchandra Dalal |
| Jatin Pravinchandra Dalal |
| Chief Financial Officer |
Dated: July 20, 2020
INDEX TO EXHIBITS
| Item | |
|---|---|
| 99.1 | IFRS Press Release |
| 99.2 | Presentation referred by the Company at the Press Conference on July 14, 2020 |
| 99.3 | Form of Advertisement Placed in Indian Newspapers |
| 99.4 | Consolidated Interim Financial Statements under IFRS |
| 99.5 | Statutorily Audited Consolidated Financial Results filed with stock exchanges in India |
| 99.6 | Data sheet containing operating metrics filed with stock exchanges in India |
EX-99.1
Exhibit 99.1
FOR IMMEDIATE RELEASE
Results for the Quarter ended June 30, 2020 under IFRS
IT Services Operating Margin^3^ for the quarter was at 19.0%
Earnings Per Share up by 5.7% YoY
Bangalore, India and East Brunswick, New Jersey, USA – July 14, 2020 – Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) today announced financial results under International Financial Reporting Standards (IFRS) for the quarter ended June 30, 2020.
Highlights ofthe Results
Results for the Quarter ended June 30, 2020:
| • | Gross Revenue was<br>₹ 149.1 billion ($2.0 billion^1^), an increase of 1.3% YoY |
|---|---|
| • | IT Services Segment Revenue was at $1,921.6 million^1^, a<br>decrease of 5.7% YoY |
| --- | --- |
| • | Non-GAAP^2^ constant<br>currency IT Services Segment Revenue decreased by 4.4% YoY |
| --- | --- |
| • | IT Services Operating Margin^3^^^for the quarter was at 19.0%, an expansion of 0.6%YoY |
| --- | --- |
| • | Net Income for the quarter was<br>₹ 23.9 billion ($316.5 million^1^), an increase of 0.1% YoY |
| --- | --- |
| • | Earnings Per Share for the quarter was at<br>₹ 4.20 ($0.06^1^), an increase of 5.7% YoY |
| --- | --- |
| • | Operating Cash Flows was at<br>₹ 41.8 billion ($553.6 million^1^), which is 174.9% of Net Income |
| --- | --- |
Performance for the quarter ended June 30, 2020
Thierry Delaporte, CEO and Managing Director said, “I am deeply honored to lead Wipro, an extraordinary company and an exemplary corporate citizen with a deep technology heritage built on a strong foundation of values. I have great respect for the work done by the Azim Premji Foundation, its 67% economic ownership of Wipro adds greater meaning to what we do. Profitable growth will be the most important priority on my agenda. I am confident that we will be able to deliver long-term, sustainable growth in the interest of all our stakeholders.”
Jatin Dalal, Chief Financial Officer said, “We expanded the margins during the quarter, despite lower revenues, on the back of solid execution of several operational improvements and rupee depreciation. We also continued to sustain robust cash generation with Operating Cash Flows at 174.9% of Net income.”
IT Services
Wipro continued its momentum in winning large deals with our customers as described below:
| • | Wipro has been selected by John Lewis Partnership, one of the UK’s leading retail groups, as a strategic<br>partner to help drive its retail transformation agenda. As part of this, Wipro will deliver state-of-the-art technology<br>infrastructure services, leveraging its capabilities in Cloud, Digital, Cyber Security, Wipro HOLMES^™^ our Artificial Intelligence (AI) and Automation Platform |
|---|---|
| ^1.^ | For the convenience of the readers, the amounts in Indian Rupees in this release have been translated into<br>United States Dollars at the certified foreign exchange rate of US$1 = ₹ 75.53, as published by the Federal Reserve Board of Governors on June 30, 2020.<br>However, the realized exchange rate in our IT Services business segment for the quarter ended June 30, 2020 was US$1= ₹ 75.95 |
| --- | --- |
| ^2.^ | Constant currency revenue for a period is the product of volumes in that period times the average actual<br>exchange rate of the corresponding comparative period |
| --- | --- |
| ^3.^ | IT Services Operating Margin refers to Segment Results Total as reflected in IFRS financials<br> |
| --- | --- |
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| • | Wipro has been awarded a strategic, multi-year infrastructure modernization and digital transformation services<br>engagement by Germany-based energy company E.ON. Wipro will transform E.ON’s legacy data center operations to a hybrid cloud model by leveraging its strong energy value chain expertise in a prosumer driven world, Boundary Less Enterprise (BLE)<br>framework and Wipro HOLMES^™^. Wipro’s consumption-based hybrid cloud hosting strategy will ensure a superior and secure customer environment spanning Perimeter & Endpoint<br>security, threat detection & response, and Privileged Access Management (PAM) |
|---|---|
| • | Wipro has won a managed services contract from a multinational European automobile manufacturer to modernize and<br>automate its engineering operations, leveraging Digital Rig, the client’s differentiated digital solution. With its strong domain expertise, globally-integrated delivery model and Wipro<br>HOLMES^™^, Wipro will drive major transformations to enhance service quality and user experience |
| --- | --- |
| • | Wipro has won a strategic multi-year engagement with a leading global investment management firm to transform and<br>manage its entire technology development services and infrastructure. The scope includes applications development and maintenance, quality engineering services, and infrastructure services comprising datacenter operations, networks, and service desk<br>support. This contract adds to the operations engagement that the customer awarded Wipro last year. Wipro will leverage its strong digital expertise and hyper automation capabilities powered by Wipro HOLMES^™^ to transform the client’s application and infrastructure estate, driving additional synergies via an integrated technology-infrastructure-operations construct |
| --- | --- |
Digital & Cloud Application Services Highlights
We continue to see increasing traction in digital oriented deals as illustrated below:
| • | Wipro has secured a contract from a US-based food distribution company to<br>deploy its CoTrack solution to meet the demands of the changing workplace due to the current pandemic. This wearable solution will enable the customer to maintain social distancing within the distribution center by sending real-time alerts in case<br>of any violation. The solution will also enable contact tracing |
|---|---|
| • | Wipro has secured a strategic cloud contract from a food and beverage conglomerate to transform their operations<br>and accelerate their digital journey, by improving agility, scalability and cost efficiencies. Wipro will strengthen advanced analytics capabilities to drive business value and offer analytical services to all entities within the organization<br> |
| --- | --- |
| • | Wipro has won a digital engagement with a European health system to build and accelerate AI-powered applications and services, helping improve healthcare access and treatment for its patients |
| --- | --- |
| • | A US-based multinational conglomerate has selected Wipro to transform<br>their Identity & Access Management services to meet the demands of the new normal. As part of the engagement, Wipro will enhance the customer’s current security environment and enable them to transition to the new solution<br> |
| --- | --- |
| • | Wipro’s crowdsourcing platform Topcoder has won a data science challenge from the U.S. Bureau of Reclamation<br>working with the NASA Tournament Lab. This challenge seeks to improve short-term streamflow forecasts via a year-long competition. Accurate stream flow forecasts enable efficient operation of water resource systems and may also be used as warning<br>for floods. Participants will develop and implement their methods for locations across the western United States and attempt to outperform the current streamflow forecasts |
| --- | --- |
Partner and Analyst Recognition
| • | Wipro Limited has been recognized as the Application Innovation and Data Estate Modernization 2020 MicrosoftPartner of the Year for our achievements in the Azure category |
|---|---|
| • | Wipro has been awarded the Storage Ecosystem Partner of the Year 2020 by Hewlett Packard Enterprise for<br>storage solutions |
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| • | Wipro was positioned as a Leader in IDC MarketScape EMEA Digital Transformation Service Providers for Oil and Gas<br>Industry (Doc #EUR146159020, Apr 2020) |
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| • | Wipro was positioned as a Leader in IDC MarketScape: Worldwide Cloud Professional Services 2020 Vendor Assessment<br>(Doc #US45439120, Apr 2020) |
|---|---|
| • | Wipro was recognized as a Leader in Everest Group’s Internet of Things (IoT) Services PEAK Matrix^®^ Assessment 2020 |
| --- | --- |
| • | Wipro was recognized as a Leader in Everest Group’s Open Banking IT Services PEAK Matrix^®^ Assessment 2020 |
| --- | --- |
| • | Wipro was positioned as a Leader in Everest Group’s IT Security Services PEAK Matrix^®^ Assessment 2020 |
| --- | --- |
| • | Wipro was recognized as a Leader in Everest Group’s Healthcare Payer Operations – Services PEAK Matrix^®^ Assessment 2020 |
| --- | --- |
| • | Wipro was featured in HFS TOP 10 Salesforce services 2020 |
| --- | --- |
| • | Wipro was positioned as a Leader in multiple quadrants in 2020 ISG Provider Lens^™^ Microsoft Ecosystem Report for USA and Germany |
| --- | --- |
| • | Wipro was positioned as a Leader in Gartner Magic Quadrant for Public Cloud Infrastructure Professional and<br>Managed Services, Worldwide, Craig Lowery et al., 4 May 2020 |
| --- | --- |
Disclaimer: Gartner does not endorse any vendor, product orservice depicted in its research publications, and does not advise technology users to select only those vendors with the highest ratings or other designation. Gartner research publications consist of the opinions of Gartner’s researchorganization and should not be construed as statements of fact. Gartner disclaims all warranties, expressed or implied, with respect to this research, including any warranties of merchantability or fitness for a particular purpose.
State of IT Infrastructure 2020 Report
Wipro released its ‘State of IT Infrastructure 2020’ report which provides a multi-dimensional view of how the COVID-19 pandemic will impact IT infrastructure trends in the immediate future
IT Products
| • | IT Products Segment Revenue for the quarter was<br>₹ 2.3 billion ($29.9 million^1^) |
|---|---|
| • | IT Products Segment Results for the quarter was a profit of ₹ 0.12 billion ($1.6 million^1^) |
| --- | --- |
India business from State Run Enterprises (SRE)
| • | India SRE Segment Revenue for the quarter was<br>₹ 2.1 billion ($28.0 million^1^) |
|---|---|
| • | India SRE Segment Results for the quarter was a loss of ₹ 0.10 billion ($1.3 million^1^) |
| --- | --- |
Please refer to the table on page 9 for reconciliation between IFRS IT Services Revenue and IT Services Revenue on a non-GAAP constant currency basis.
About Non-GAAP Financial Measures
This press release contains non-GAAP financial measures within the meaning of Regulation G and Item 10(e) of Regulation S-K. Such non-GAAP financial measures are measures of our historical or future performance, financial position or cash flows that are adjusted to exclude or include amounts that are excluded or included, as the case may be, from the most directly comparable financial measure calculated and presented in accordance with IFRS.
The table on page 9 provides IT Services Revenue on a constant currency basis, which is a non-GAAP financial measure that is calculated by translating IT Services Revenue from the current reporting period into U.S. dollars based on the currency conversion rate in effect for the prior reporting period. We refer to growth rates in constant currency so that business results may be viewed without the impact of fluctuations in foreign currency exchange rates, thereby facilitating period-to-period comparisons of our business performance. Further, in the normal course of business, we may divest a portion of our business which may not be strategic. We refer to the growth rates in both reported and constant currency adjusting for such divestments in order to represent the comparable growth rates.
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This non-GAAP financial measure is not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, the most directly comparable financial measure calculated in accordance with IFRS and may be different from non-GAAP measures used by other companies. In addition to this non-GAAP measure, the financial statements prepared in accordance with IFRS and the reconciliation of these non-GAAP financial measures with the most directly comparable IFRS financial measure should be carefully evaluated.
Results for the quarter ended June 30, 2020, prepared under IFRS, along with individual business segment reports, are available in the Investorssection of our website www.wipro.com
Quarterly Conference Call
We will hold an earnings conference call today at 06:45 p.m. Indian Standard Time (09:15 a.m. U.S. Eastern Time) to discuss our performance for the quarter. The audio from the conference call will be available online through a web-cast and can be accessed at the following link- https://links.ccwebcast.com/?EventId=WIP200714
An audio recording of the management discussions and the question and answer session will be available online and will be accessible in the Investor Relations section of our website at www.wipro.com
About Wipro Limited
Wipro Limited (NYSE: WIT, BSE: 507685, NSE: WIPRO) is a leading global information technology, consulting and business process services company. We harness the power of cognitive computing, hyper-automation, robotics, cloud, analytics and emerging technologies to help our clients adapt to the digital world and make them successful. A company recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship, we have over 180,000 dedicated employees serving clients across six continents. Together, we discover ideas and connect the dots to build a better and a bold new future.
| Contact for Investor Relations | Contact for Media & Press | |
|---|---|---|
| Aparna Iyer | Abhishek Kumar Jain | Vipin Nair |
| Phone: +91-80-6142 7139 | Phone: +91-9845791363 | Phone: +91-80-6142 7139 |
| iyer.aparna@wipro.com | abhishekkumar.jain@wipro.com | vipin.nair1@wipro.com |
Forward-Looking Statements
The forward-looking statements contained herein represent Wipro’s beliefs regarding future events, many of which are by their nature, inherently uncertain and outside Wipro’s control. Such statements include, but are not limited to, statements regarding Wipro’s growth prospects, its future financial operating results, and its plans, expectations and intentions. Wipro cautions readers that the forward-looking statements contained herein are subject to risks and uncertainties that could cause actual results to differ materially from the results anticipated by such statements. Such risks and uncertainties include, but are not limited to, risks and uncertainties regarding fluctuations in our earnings, revenue and profits, our ability to generate and manage growth, complete proposed corporate actions, intense competition in IT services, our ability to maintain our cost advantage, wage increases in India, our ability to attract and retain highly skilled professionals, time and cost overruns on fixed-price, fixed-time frame contracts, client concentration, restrictions on immigration, our ability to manage our international operations, reduced demand for technology in our key focus areas, disruptions in telecommunication networks, our ability to successfully complete and integrate potential acquisitions, liability for damages on our service contracts, the success of the companies in which we make strategic investments, withdrawal of fiscal governmental incentives, political instability, war, legal restrictions on raising capital or acquiring companies outside India,
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unauthorized use of our intellectual property and general economic conditions affecting our business and industry. The conditions caused by the COVID-19 pandemic could decrease technology spending, adversely affect demand for our products, affect the rate of customer spending and could adversely affect our customers’ ability or willingness to purchase our offerings, delay prospective customers’ purchasing decisions, adversely impact our ability to provide on-site consulting services and our inability to deliver our customers or delay the provisioning of our offerings, all of which could adversely affect our future sales, operating results and overall financial performance. Our operations may also be negatively affected by a range of external factors related to the COVID-19 pandemic that are not within our control.
Additional risks that could affect our future operating results are more fully described in our filings with the United States Securities and Exchange Commission, including, but not limited to, Annual Reports on Form 20-F. These filings are available at www.sec.gov. We may, from time to time, make additional written and oral forward-looking statements, including statements contained in the company’s filings with the Securities and Exchange Commission and our reports to shareholders. We do not undertake to update any forward-looking statement that may be made from time to time by us or on our behalf.
# # (Tables to follow)
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WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(₹ in millions,except share and per share data, unless otherwise stated)
| As at March 31, 2020 | As at June 30, 2020 | |||||
|---|---|---|---|---|---|---|
| Convenience translationinto US dollar in millionsRefer footnote 1 in page 1 | ||||||
| ASSETS | ||||||
| Goodwill | 131,012 | 131,596 | 1,742 | |||
| Intangible assets | 16,362 | 15,501 | 205 | |||
| Property, plant and equipment | 81,120 | 81,843 | 1,084 | |||
| Right-of-Use<br>assets | 16,748 | 16,018 | 212 | |||
| Financial assets | ||||||
| Investments | 9,302 | 8,875 | 118 | |||
| Trade receivables | 6,049 | 6,047 | 80 | |||
| Other financial assets | 5,881 | 6,354 | 84 | |||
| Investments accounted for using the equity method | 1,383 | 1,412 | 19 | |||
| Deferred tax assets | 6,005 | 3,073 | 41 | |||
| Non-current tax assets | 11,414 | 11,821 | 157 | |||
| Other non-current assets | 11,935 | 11,457 | 152 | |||
| Total non-current assets | **** | 297,211 | **** | 293,997 | **** | 3,894 |
| Inventories | 1,865 | 1,644 | 22 | |||
| Financial assets | ||||||
| Derivative assets | 3,025 | 1,666 | 22 | |||
| Investments | 189,635 | 213,865 | 2,832 | |||
| Cash and cash equivalents | 144,499 | 159,443 | 2,111 | |||
| Trade receivables | 104,474 | 93,023 | 1,232 | |||
| Unbilled receivables | 25,209 | 24,659 | 326 | |||
| Other financial assets | 8,614 | 10,526 | 139 | |||
| Contract assets | 17,143 | 16,301 | 216 | |||
| Current tax assets | 2,882 | 2,400 | 32 | |||
| Other current assets | 22,505 | 23,584 | 312 | |||
| Total current assets | **** | 519,851 | **** | 547,111 | **** | 7,244 |
| TOTAL ASSETS | **** | 817,062 | **** | 841,108 | **** | 11,138 |
| EQUITY | ||||||
| Share capital | 11,427 | 11,429 | 151 | |||
| Share premium | 1,275 | 1,568 | 21 | |||
| Retained earnings | 476,103 | 494,659 | 6,549 | |||
| Share-based payment reserve | 1,550 | 1,512 | 20 | |||
| SEZ Re-investment reserve | 43,804 | 49,234 | 652 | |||
| Other components of equity | 23,299 | 28,352 | 375 | |||
| Equity attributable to the equity holders of the Company | **** | 557,458 | **** | 586,754 | **** | 7,768 |
| Non-controlling interest | 1,875 | 1,062 | 14 | |||
| TOTAL EQUITY | **** | 559,333 | **** | 587,816 | **** | 7,782 |
| LIABILITIES | ||||||
| Financial liabilities | ||||||
| Long - term loans and borrowings | 4,840 | 4,747 | 63 | |||
| Derivative liabilities | 138 | 85 | 1 | |||
| Lease liabilities | 12,638 | 12,744 | 169 | |||
| Other financial liabilities | 151 | 192 | 3 | |||
| Deferred tax liabilities | 2,825 | 2,261 | 30 | |||
| Non-current tax liabilities | 13,205 | 13,060 | 173 | |||
| Other non-current liabilities | 7,537 | 8,293 | 110 | |||
| Provisions | 2 | 4 | ^ | |||
| Total non-current liabilities | **** | 41,336 | **** | 41,386 | **** | 549 |
| Financial liabilities | ||||||
| Loans, borrowings and bank overdrafts | 73,202 | 69,490 | 920 | |||
| Derivative liabilities | 7,231 | 2,740 | 36 | |||
| Trade payables and accrued expenses | 78,129 | 75,057 | 995 | |||
| Lease liabilities | 6,560 | 7,080 | 94 | |||
| Other financial liabilities | 899 | 885 | 12 | |||
| Contract liabilities | 18,775 | 18,279 | 242 | |||
| Current tax liabilities | 11,731 | 13,970 | 185 | |||
| Other current liabilities | 19,254 | 23,546 | 312 | |||
| Provisions | 612 | 859 | 11 | |||
| Total current liabilities | **** | 216,393 | **** | 211,906 | **** | 2,807 |
| TOTAL LIABILITIES | **** | 257,729 | **** | 253,292 | **** | 3,356 |
| TOTAL EQUITY AND LIABILITIES | **** | 817,062 | **** | 841,108 | **** | 11,138 |
| ^ Value is less than 1 |
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WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME
(₹ in millions,except share and per share data, unless otherwise stated)
| Three months ended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2019 | 2020 | 2020 | ||||
| Convenience translationinto US dollar in millionsRefer footnote 1 in page 1 | ||||||
| Revenues | 147,161 | 149,131 | 1,974 | |||
| Cost of revenues | (104,273) | (103,700) | (1,373) | |||
| Gross profit | **** | 42,888 | **** | 45,431 | **** | 601 |
| Selling and marketing expenses | (10,953) | (9,789) | (130) | |||
| General and administrative expenses | (8,119) | (10,006) | (132) | |||
| Foreign exchange gains/(losses), net | 858 | 1,205 | 16 | |||
| Other operating income | 699 | 97 | 1 | |||
| Results from operating activities | **** | 25,373 | **** | 26,938 | **** | 356 |
| Finance expenses | (1,584) | (1,299) | (17) | |||
| Finance and other income | 6,947 | 5,281 | 70 | |||
| Share of net profit /(loss) of associates accounted for using the equity method | (16) | 31 | ^ | |||
| Profit before tax | **** | 30,720 | **** | 30,951 | **** | 409 |
| Income tax expense | (6,699) | (6,838) | (91) | |||
| Profit for the period | **** | 24,021 | **** | 24,113 | **** | 318 |
| Profit attributable to: | ||||||
| Equity holders of the Company | 23,874 | 23,902 | 315 | |||
| Non-controlling interest | 147 | 211 | 3 | |||
| Profit for the period | **** | 24,021 | **** | 24,113 | **** | 318 |
| Earnings per equity share: | ||||||
| Attributable to equity holders of the Company | ||||||
| Basic | 3.97 | 4.20 | 0.06 | |||
| Diluted | 3.96 | 4.19 | 0.06 | |||
| Weighted average number of equity shares used in computing earnings per equityshare | ||||||
| Basic | 6,010,597,369 | 5,693,348,171 | 5,693,348,171 | |||
| Diluted | 6,025,352,442 | 5,703,168,248 | 5,703,168,248 | |||
| ^ Value is less than 1 |
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Additional Information:
| Particulars | Three months ended | Year ended | ||||||
|---|---|---|---|---|---|---|---|---|
| June 30,2020 | March 31,2020 | June 30,2019 | March 31,2020 | |||||
| Audited | Audited | Audited | Audited | |||||
| Revenue | ||||||||
| IT Services | ||||||||
| BFSI | 44,828 | 46,690 | 45,395 | 184,457 | ||||
| Health BU | 19,760 | 20,589 | 18,871 | 78,240 | ||||
| CBU | 23,179 | 25,669 | 22,366 | 97,008 | ||||
| ENU | 19,279 | 19,570 | 18,432 | 76,443 | ||||
| TECH | 19,670 | 19,503 | 18,660 | 75,895 | ||||
| MFG | 11,820 | 12,486 | 11,336 | 48,158 | ||||
| COMM | 7,420 | 8,453 | 8,454 | 33,840 | ||||
| Total of IT Services | **** | 145,956 | **** | 152,960 | **** | 143,514 | **** | 594,041 |
| IT Products | 2,258 | 2,792 | 2,409 | 11,010 | ||||
| ISRE | 2,117 | 2,341 | 2,143 | 8,400 | ||||
| Reconciling Items | 5 | 10 | (47) | (50) | ||||
| Total Revenue | **** | 150,336 | **** | 158,103 | **** | 148,019 | **** | 613,401 |
| Other operating Income | ||||||||
| IT Services | 97 | 395 | 699 | 1,144 | ||||
| Total Other Operating Income | **** | 97 | **** | 395 | **** | 699 | **** | 1,144 |
| Segment Result | ||||||||
| IT Services | ||||||||
| BFSI | 8,517 | 8,144 | 9,335 | 34,132 | ||||
| Health BU | 2,728 | 3,049 | 2,929 | 12,027 | ||||
| CBU | 4,419 | 4,546 | 3,506 | 16,729 | ||||
| ENU | 3,569 | 3,766 | 2,196 | 12,176 | ||||
| TECH | 4,167 | 3,906 | 3,526 | 14,312 | ||||
| MFG | 2,228 | 2,336 | 2,092 | 9,252 | ||||
| COMM | 891 | 1,330 | 1,518 | 5,336 | ||||
| Unallocated | 1,206 | (547) | 720 | 2,577 | ||||
| Other Operating Income | 97 | 395 | 699 | 1,144 | ||||
| Total of IT Services | **** | 27,822 | **** | 26,925 | **** | 26,521 | **** | 107,685 |
| IT Products | 124 | 116 | (407) | (282) | ||||
| ISRE | (100) | (481) | (636) | (1,822) | ||||
| Reconciling Items | (908) | (171) | (105) | 149 | ||||
| Total | **** | 26,938 | **** | 26,389 | **** | 25,373 | **** | 105,730 |
| Finance Expense | (1,299) | (1,653) | (1,584) | (7,328) | ||||
| Finance and Other Income | 5,281 | 4,907 | 6,947 | 24,081 | ||||
| Share of net profit/ (loss) of associates accounted for using the equity method | 31 | 13 | (16) | 29 | ||||
| Profit before tax | **** | 30,951 | **** | 29,656 | **** | 30,720 | **** | 122,512 |
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The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (ISRE).
IT Services: The IT Services segment primarily consists of IT Service offerings to customers organized by industry verticals.
The industry verticals are as follows: Banking, Financial Services and Insurance (BFSI), Health Business unit (Health BU), Consumer Business unit (CBU), Energy, Natural Resources & Utilities (ENU), Manufacturing (MFG), Technology (TECH) and Communications (COMM). Key service offerings to customers includes software application development and maintenance, research and development services for hardware and software design, business application services, analytics, consulting, infrastructure outsourcing services and business process services.
IT Products: The Company is a value-added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to the above items is reported as revenue from the sale of IT Products.
India State Run Enterprise segment (ISRE): This segment consists of IT Services offerings to entities/ departments owned or controlled by the Government of India and/ or any State Governments.
Reconciliation of Non-GAAP ConstantCurrency IT Services Revenue to IT Services Revenue as per IFRS ($MN)
| Three Months ended June 30, 2020 | ||
|---|---|---|
| IT Services Revenue as per IFRS | $ | 1921.6 |
| Effect of Foreign currency exchange movement | $ | 27.6 |
| Non-GAAP Constant Currency IT Services Revenue based on<br>exchange rates of comparable period in previous year | $ | 1949.2 |
9
EX-99.2
Jatin Dalal Chief Financial Officer Wipro Limited Performance for the Quarter ended June 30, 2020 Exhibit 99.2
Revenue for the quarter IT Services $ Revenue Mn QoQ & YoY growth on Constant Currency* basis is -7.5% & -4.4% Gross Revenue in INR Mn *Non-GAAP measures walk has been provided in the annexure
Operating Margin for the quarter IT Services Operating Margin IT Services operating margin refers to our segment results Operating Profit (Wipro Ltd.) in INR Mn
Net Income for the quarter Net Income in INR Mn Net income refers to the profit attributable to equity share holders of the company Earnings per share in INR
Cash Flow Metrics for the quarter Operating Cash flow in INR Mn Operating Cash Flow is at 174.9% of Net Income Free Cash flow in INR Mn* Free Cash Flow is at 157.5% of Net Income *Non-GAAP measures walk has been provided in the annexure
Other highlights for the quarter Gross Utilization is at 75% for Q1’21 Offshore revenue mix is at 48.5% for Q1’21 Gross hire of over 7,000 employees for the quarter Voluntary Attrition on LTM basis has reduced to 13.0% Localization in US now at 69.8% Added 5 customers in $20Mn+ revenue bucket YoY Committed ₹100 crores towards efforts on COVID-19 crisis, of which ₹25 crores was contributed to Prime Minister’s relief fund
Thank You
Reconciliation of selected GAAP measures to Non-GAAP measures Reconciliation of Gross Cash as of June 30, 2020 Reconciliation of Free Cash Flow for three months ended June 30, 2020
Reconciliation of selected GAAP measures to Non-GAAP measures Reconciliation of Non-GAAP Constant Currency IT Services Revenue to IT Services Revenue as per IFRS ($Mn): Three Months ended June 30, 2020 IT Services Revenue as per IFRS $1,921.6 Effect of Foreign currency exchange movement $ (3.6) Non-GAAP Constant Currency IT Services Revenue based on $1,918.0 previous quarter exchange rates Three Months ended June 30, 2020 IT Services Revenue as per IFRS $1,921.6 Effect of Foreign currency exchange movement $ 27.6 Non-GAAP Constant Currency IT Services Revenue based on $1,949.2 exchange rates of comparable period in previous year
EX-99.3
Exhibit 99.3
Wipro Limited
Extract of auditedfinancial results of Wipro Limited and its subsidiaries for the quarter ended June 30, 2020
Consolidated Audited Financial Results of WiproLimited under IFRS
(₹ in millions, except per share data, unless otherwise stated)
| Particulars | Quarter ended<br>June 30, 2020 | Quarter endedMarch 31, 2020 | Quarter ended<br>June 30, 2019 |
|---|---|---|---|
| Total income from operations (net) | 150,433 | 158,498 | 148,718 |
| Net Profit / (Loss) before tax, exceptional and extraordinary items | 30,951 | 29,656 | 30,720 |
| Net Profit / (Loss) before tax but after exceptional and<br>extraordinary items | 30,951 | 29,656 | 30,720 |
| Net Profit / (Loss) after tax, exceptional and extraordinary items | 24,113 | 23,451 | 24,021 |
| Total Comprehensive Income after tax | 29,102 | 25,175 | 25,311 |
| Equity Share Capital | 11,429 | 11,427 | 12,071 |
| Reserves excluding Revaluation Reserve | 575,325 | 546,031 | 580,834 |
| Earnings Per Share (after extraordinary items) (of ₹ 2/- each)<br> <br>Basic:<br><br><br>Diluted: | 4.20<br> <br>4.19 | 4.09<br> <br>4.07 | 3.97<br> <br>3.96 |
The audited interim consolidated financial results of the Company for the three months ended June 30, 2020 have been approved by the Board of Directors of the Company at its meeting held on July 14, 2020. The statutory auditors have expressed an unmodified audit opinion.
Financial Results of Wipro Limited under Ind AS
The interim condensed financial results are prepared in accordance with Indian Accounting Standards (“Ind AS”), the provisions of the Companies Act, 2013 (“the Companies Act”), as applicable and guidelines issued by the Securities and Exchange Board of India (“SEBI”). The Ind AS are prescribed under Section 133 of the Act read with Rule 3 of the Companies (Indian Accounting Standards) Rules, 2015 and Companies (Indian Accounting Standards) Amendment Rules, 2016.
These financial statements, are prepared in accordance with Ind AS.
Consolidated Audited Financial Results of Wipro Limited under Ind AS
| Particulars | Quarter ended<br>June 30, 2020 | Quarter endedMarch 31, 2020 | Quarter ended<br>June 30, 2019 |
|---|---|---|---|
| Total income from operations (net) | 149,228 | 157,505 | 147,860 |
| Net Profit / (Loss) before tax, exceptional and extraordinary items | 30,953 | 29,658 | 30,722 |
| Net Profit / (Loss) before tax but after exceptional and<br>extraordinary items | 30,953 | 29,658 | 30,722 |
| Net Profit / (Loss) after tax, exceptional and extraordinary items | 24,115 | 23,452 | 24,023 |
| Total Comprehensive Income after tax | 29,107 | 24,944 | 25,319 |
| Equity Share Capital | 11,429 | 11,427 | 12,071 |
| Reserves excluding Revaluation Reserve | 571,089 | 541,790 | 576,952 |
| Earnings Per Share (after extraordinary items) (of ₹ 2/- each)<br> <br>Basic:<br><br><br>Diluted: | 4.20<br> <br>4.19 | 4.09<br> <br>4.08 | 3.97<br> <br>3.96 |
CIN: L32102KA1945PLC020800; Registered Office: Wipro Limited, Doddakanneli, Sarjapur Road, Bengaluru-560035, India
Website: www.wipro.com; Email Id- Info@wipro.com; Tel: +91-80-2844 0011; Fax: +91-80-2844 0054
The audited interim consolidated financial results (under Ind AS) of the Company for the three months endedJune 30, 2020 have been approved by the Board of Directors of the Company at its meeting held on July 14, 2020. The statutory auditors have expressed an unmodified audit opinion.
Standalone Audited Financial Results of Wipro Limited under Ind AS
| Particulars | Quarter ended<br>June 30, 2020 | Quarter endedMarch 31, 2020 | Quarter ended<br>June 30, 2019 |
|---|---|---|---|
| Total income from operations (net) | 121,929 | 131,272 | 120,613 |
| Net Profit / (Loss) before tax, exceptional and extraordinary items | 27,989 | 27,627 | 26,439 |
| Net Profit / (Loss) before tax but after exceptional and extraordinary items | 27,989 | 27,627 | 26,439 |
| Net Profit / (Loss) after tax, exceptional and extraordinary items | 21,926 | 21,583 | 20,141 |
| Total Comprehensive Income after tax | 25,393 | 18,865 | 21,227 |
| Equity Share Capital | 11,429 | 11,427 | 12,071 |
| Reserves excluding Revaluation Reserve | 478,841 | 453,110 | 503,140 |
| Earnings Per Share (after extraordinary items) (of ₹ 2/- each)<br> <br>Basic:<br><br><br>Diluted: | 3.85<br> <br>3.84 | 3.79<br> <br>3.77 | 3.35<br> <br>3.34 |
The audited interim financial results of the Company for the three months ended June 30, 2020 have been approved by the Board of Directors of the Company at its meeting held on July 14, 2020. The statutory auditors have expressed an unmodified audit opinion.
Notes:
| 1. | The above is an extract of the detailed format of Quarterly Financial Results filed with the Stock Exchanges<br>under Regulation 33 of the SEBI (Listing and Other Disclosure Requirements) Regulations, 2015. The full format of the Quarterly Financial Results are available on the Bombay Stock Exchange website (URL: www.bseindia.com/corporates), the<br>National Stock Exchange website (URL: www.nseindia.com/corporates) and on the Company’s website (URL: www.wipro.com). |
|---|---|
| 2. | On July 13, 2020, the Company entered into a definitive agreement to acquire IVIA Serviços de<br>Informática Ltda., a specialized IT services provider to financial services, retail and manufacturing sectors in Brazil, for a consideration of BRL 120 million (USD 22.4 million). The acquisition is subject to customary closing<br>conditions and is expected to close in the quarter ending September 30, 2020. |
| --- | --- |
| By Order of the Board, | |
| --- | --- |
| For Wipro Limited | |
| Place: Bengaluru | Rishad A. Premji |
| Date: July 14, 2020 | Chairman |
CIN: L32102KA1945PLC020800; Registered Office: Wipro Limited, Doddakanneli, Sarjapur Road, Bengaluru-560035, India
Website: www.wipro.com; Email Id- Info@wipro.com; Tel: +91-80-2844 0011; Fax: +91-80-2844 0054
EX-99.4
Exhibit 99.4
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS UNDER IFRS
AS AT AND FOR THE THREE MONTHS ENDED JUNE 30, 2020
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF FINANCIAL POSITION
(₹ in millions,except share and per share data, unless otherwise stated)
| Notes | As at March 31, 2020 | As at June 30, 2020 | ||||||
|---|---|---|---|---|---|---|---|---|
| Convenience translationinto US dollar inmillions (unaudited)Refer to Note 2(iii) | ||||||||
| ASSETS | ||||||||
| Goodwill | 6 | 131,012 | 131,596 | 1,742 | ||||
| Intangible assets | 6 | 16,362 | 15,501 | 205 | ||||
| Property, plant and equipment | 4 | 81,120 | 81,843 | 1,084 | ||||
| Right-of-Use<br>assets | 5 | 16,748 | 16,018 | 212 | ||||
| Financial assets | ||||||||
| Investments | 7 | 9,302 | 8,875 | 118 | ||||
| Trade receivables | 6,049 | 6,047 | 80 | |||||
| Other financial assets | 10 | 5,881 | 6,354 | 84 | ||||
| Investments accounted for using the equity method | 1,383 | 1,412 | 19 | |||||
| Deferred tax assets | 6,005 | 3,073 | 41 | |||||
| Non-current tax assets | 11,414 | 11,821 | 157 | |||||
| Other non-current assets | 11 | 11,935 | 11,457 | 152 | ||||
| Total non-current assets | **** | 297,211 | **** | 293,997 | **** | 3,894 | ||
| Inventories | 8 | 1,865 | 1,644 | 22 | ||||
| Financial assets | ||||||||
| Derivative assets | 16 | 3,025 | 1,666 | 22 | ||||
| Investments | 7 | 189,635 | 213,865 | 2,832 | ||||
| Cash and cash equivalents | 9 | 144,499 | 159,443 | 2,111 | ||||
| Trade receivables | 104,474 | 93,023 | 1,232 | |||||
| Unbilled receivables | 25,209 | 24,659 | 326 | |||||
| Other financial assets | 10 | 8,614 | 10,526 | 139 | ||||
| Contract assets | 17,143 | 16,301 | 216 | |||||
| Current tax assets | 2,882 | 2,400 | 32 | |||||
| Other current assets | 11 | 22,505 | 23,584 | 312 | ||||
| Total current assets | **** | 519,851 | **** | 547,111 | **** | 7,244 | ||
| TOTAL ASSETS | **** | 817,062 | **** | 841,108 | **** | 11,138 | ||
| EQUITY | ||||||||
| Share capital | 11,427 | 11,429 | 151 | |||||
| Share premium | 1,275 | 1,568 | 21 | |||||
| Retained earnings | 476,103 | 494,659 | 6,549 | |||||
| Share-based payment reserve | 1,550 | 1,512 | 20 | |||||
| SEZ Re-investment reserve | 43,804 | 49,234 | 652 | |||||
| Other components of equity | 23,299 | 28,352 | 375 | |||||
| Equity attributable to the equity holders of the Company | **** | 557,458 | **** | 586,754 | **** | 7,768 | ||
| Non-controlling interest | 1,875 | 1,062 | 14 | |||||
| TOTAL EQUITY | **** | 559,333 | **** | 587,816 | **** | 7,782 | ||
| LIABILITIES | ||||||||
| Financial liabilities | ||||||||
| Long - term loans and borrowings | 12 | 4,840 | 4,747 | 63 | ||||
| Derivative liabilities | 16 | 138 | 85 | 1 | ||||
| Lease liabilities | 12,638 | 12,744 | 169 | |||||
| Other financial liabilities | 13 | 151 | 192 | 3 | ||||
| Deferred tax liabilities | 2,825 | 2,261 | 30 | |||||
| Non-current tax liabilities | 13,205 | 13,060 | 173 | |||||
| Other non-current liabilities | 14 | 7,537 | 8,293 | 110 | ||||
| Provisions | 15 | 2 | 4 | ^ | ||||
| Total non-current liabilities | **** | 41,336 | **** | 41,386 | **** | 549 | ||
| Financial liabilities | ||||||||
| Loans, borrowings and bank overdrafts | 12 | 73,202 | 69,490 | 920 | ||||
| Derivative liabilities | 16 | 7,231 | 2,740 | 36 | ||||
| Trade payables and accrued expenses | 78,129 | 75,057 | 995 | |||||
| Lease liabilities | 6,560 | 7,080 | 94 | |||||
| Other financial liabilities | 13 | 899 | 885 | 12 | ||||
| Contract liabilities | 18,775 | 18,279 | 242 | |||||
| Current tax liabilities | 11,731 | 13,970 | 185 | |||||
| Other current liabilities | 14 | 19,254 | 23,546 | 312 | ||||
| Provisions | 15 | 612 | 859 | 11 | ||||
| Total current liabilities | **** | 216,393 | **** | 211,906 | **** | 2,807 | ||
| TOTAL LIABILITIES | **** | 257,729 | **** | 253,292 | **** | 3,356 | ||
| TOTAL EQUITY AND LIABILITIES | **** | 817,062 | **** | 841,108 | **** | 11,138 | ||
| ^ | Value is less than 1 | |||||||
| --- | --- |
The accompanying notes form an integral part of these interim condensed consolidated financial statements
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
|---|---|---|---|
| for Deloitte Haskins & Sells LLP<br><br><br>Chartered Accountants<br> <br>Firm Registration No: 117366W/W -<br>100018 | Rishad A. Premji<br> <br>Chairman | M. K. Sharma<br> <br>Director | Thierry Delaporte<br> <br>Chief Executive<br>Officer &<br> <br>Managing Director |
| Vikas Bagaria<br> <br>Partner<br><br><br>Membership No. 60408 | Jatin Pravinchandra Dalal<br> <br>Chief<br>Financial Officer | M. Sanaulla Khan<br> <br>Company<br>Secretary | |
| Bengaluru | |||
| July 14, 2020 |
1
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF INCOME
(₹ in millions,except share and per share data, unless otherwise stated)
| Three months ended June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Notes | 2019 | 2020 | 2020 | ||||||||
| Convenience translation<br>into US dollar in<br>millions (unaudited)<br>Refer to Note 2(iii) | |||||||||||
| Revenues | 19 | 147,161 | 149,131 | 1,974 | |||||||
| Cost of revenues | 20 | (104,273 | ) | (103,700 | ) | (1,373 | ) | ||||
| Gross profit | **** | 42,888 | **** | **** | 45,431 | **** | **** | 601 | **** | ||
| Selling and marketing expenses | 20 | (10,953 | ) | (9,789 | ) | (130 | ) | ||||
| General and administrative expenses | 20 | (8,119 | ) | (10,006 | ) | (132 | ) | ||||
| Foreign exchange gains/(losses), net | 22 | 858 | 1,205 | 16 | |||||||
| Other operating income | 25 | 699 | 97 | 1 | |||||||
| Results from operating activities | **** | 25,373 | **** | **** | 26,938 | **** | **** | 356 | **** | ||
| Finance expenses | 21 | (1,584 | ) | (1,299 | ) | (17 | ) | ||||
| Finance and other income | 22 | 6,947 | 5,281 | 70 | |||||||
| Share of net profit /(loss) of associates accounted for using the equity method | (16 | ) | 31 | ^ | |||||||
| Profit before tax | **** | 30,720 | **** | **** | 30,951 | **** | **** | 409 | **** | ||
| Income tax expense | 18 | (6,699 | ) | (6,838 | ) | (91 | ) | ||||
| Profit for the period | **** | 24,021 | **** | **** | 24,113 | **** | **** | 318 | **** | ||
| Profit attributable to: | |||||||||||
| Equity holders of the Company | 23,874 | 23,902 | 315 | ||||||||
| Non-controlling interest | 147 | 211 | 3 | ||||||||
| Profit for the period | **** | 24,021 | **** | **** | 24,113 | **** | **** | 318 | **** | ||
| Earnings per equity share: | 23 | ||||||||||
| Attributable to equity holders of the Company | |||||||||||
| Basic | 3.97 | 4.20 | 0.06 | ||||||||
| Diluted | 3.96 | 4.19 | 0.06 | ||||||||
| Weighted average number of equity shares used in computing earnings per equityshare | |||||||||||
| Basic | 6,010,597,369 | 5,693,348,171 | 5,693,348,171 | ||||||||
| Diluted | 6,025,352,442 | 5,703,168,248 | 5,703,168,248 |
^ Value is less than 1
The accompanying notes form an integral part of these interim condensed consolidated financial statements
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
|---|---|---|---|
| for Deloitte Haskins & Sells LLP<br><br><br>Chartered Accountants<br> <br>Firm Registration No: 117366W/W -<br>100018 | Rishad A. Premji<br> <br>Chairman | M. K. Sharma<br> <br>Director | Thierry Delaporte<br> <br>Chief Executive<br>Officer &<br> <br>Managing Director |
| Vikas Bagaria<br> <br>Partner<br><br><br>Membership No. 60408 | Jatin Pravinchandra Dalal<br> <br>Chief<br>Financial Officer | M. Sanaulla Khan<br> <br>Company<br>Secretary | |
| Bengaluru | |||
| July 14, 2020 |
2
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
(₹ in millions,except share and per share data, unless otherwise stated)
| Three months ended June 30, | |||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|
| Notes | 2019 | 2020 | 2020 | ||||||||
| Convenience translationinto US dollar inmillions (unaudited)Refer to Note 2(iii) | |||||||||||
| Profit for the period | **** | 24,021 | **** | **** | 24,113 | **** | **** | 318 | **** | ||
| Other comprehensive income (OCI) | |||||||||||
| Items that will not be reclassified to statement of income in subsequent periods | |||||||||||
| Remeasurements of the net defined benefit liability /(asset) comprising actuarial gains and<br>losses | 87 | (291 | ) | (4 | ) | ||||||
| Net change in fair value of equity instruments measured at fair value through OCI | 4 | 460 | 6 | ||||||||
| **** | 91 | **** | **** | 169 | **** | **** | 2 | **** | |||
| Items that may be reclassified to statement of income in subsequentperiods | |||||||||||
| Foreign currency translation differences | 17 | 308 | 1,091 | 14 | |||||||
| Net change in time value of option contracts designated as cash flow hedges | (90 | ) | 86 | 1 | |||||||
| Net change in intrinsic value of option contracts designated as cash flow hedges | 123 | 626 | 8 | ||||||||
| Net change in fair value of forward contracts designated as cash flow hedges | 219 | 96 | 1 | ||||||||
| Net change in fair value of debt instruments measured at fair value through OCI | 639 | 2,921 | 39 | ||||||||
| **** | 1,199 | **** | **** | 4,820 | **** | **** | 63 | **** | |||
| Total other comprehensive income/ (loss), net of taxes | 1,290 | 4,989 | 65 | ||||||||
| Total comprehensive income for the period | **** | 25,311 | **** | **** | 29,102 | **** | **** | 383 | **** | ||
| Total Comprehensive income attributable to: | |||||||||||
| Equity holders of the Company | 25,178 | 28,955 | 381 | ||||||||
| Non-controlling interest | 133 | 147 | 2 | ||||||||
| **** | 25,311 | **** | **** | 29,102 | **** | **** | 383 | **** |
The accompanying notes form an integral part of these interim condensed consolidated financial statements
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
|---|---|---|---|
| for Deloitte Haskins & Sells LLP<br><br><br>Chartered Accountants<br> <br>Firm Registration No: 117366W/W -<br>100018 | Rishad A. Premji<br> <br>Chairman | M. K. Sharma<br> <br>Director | Thierry Delaporte<br> <br>Chief Executive<br>Officer &<br> <br>Managing Director |
| Vikas Bagaria<br> <br>Partner<br><br><br>Membership No. 60408 | Jatin Pravinchandra Dalal<br> <br>Chief<br>Financial Officer | M. Sanaulla Khan<br> <br>Company<br>Secretary | |
| Bengaluru | |||
| July 14, 2020 |
3
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(₹ in millions,except share and per share data, unless otherwise stated)
| Other components ofequity | |||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Particulars | Number ofshares* | Share capital,fully paid-up | Sharepremium | Retainedearnings | Share-basedpaymentreserve | SEZRe-investmentreserve | Foreigncurrencytranslationreserve | Cashflowhedgingreserve | Otherreserves | Equityattributableto theequityholders oftheCompany | Non-controllinginterest | Totalequity | |||||||||||||||||
| As at April 1, 2019 | 6,033,935,388 | 12,068 | 533 | 506,135 | 2,617 | 28,565 | 15,250 | 2,415 | 533 | 568,116 | 2,637 | 570,753 | |||||||||||||||||
| Adjustment on adoption of IFRS 16 (net of tax) | — | — | — | (872 | ) | — | — | — | — | — | (872 | ) | — | (872 | ) | ||||||||||||||
| Adjusted balances as at April 1, 2019 | 6,033,935,388 | 12,068 | 533 | 505,263 | 2,617 | 28,565 | 15,250 | 2,415 | 533 | 567,244 | 2,637 | 569,881 | |||||||||||||||||
| Comprehensive income for the period | |||||||||||||||||||||||||||||
| Profit for the period | — | — | — | 23,874 | — | — | — | — | — | 23,874 | 147 | 24,021 | |||||||||||||||||
| Other comprehensive income | — | — | — | — | — | 322 | 252 | 730 | 1,304 | (14 | ) | 1,290 | |||||||||||||||||
| Total comprehensive income for the period | **** | — | **** | — | **** | — | **** | 23,874 | **** | **** | — | **** | **** | — | **** | 322 | **** | 252 | **** | 730 | **** | 25,178 | **** | **** | 133 | **** | **** | 25,311 | **** |
| Transaction with owners of the Company, recognized directly in equity | |||||||||||||||||||||||||||||
| Issue of equity shares on exercise of options | 1,424,187 | 3 | 437 | — | (437 | ) | — | — | — | — | 3 | — | 3 | ||||||||||||||||
| Issue of shares by controlled trust on exercise of options | — | — | — | 352 | (352 | ) | — | — | — | — | — | — | — | ||||||||||||||||
| Compensation cost related to employee share-based payment | — | — | — | 3 | 471 | — | — | — | — | 474 | — | 474 | |||||||||||||||||
| Total transactions with owners of the Company | **** | 1,424,187 | **** | 3 | **** | 437 | **** | 355 | **** | **** | (318 | ) | **** | — | **** | — | **** | — | **** | — | **** | 477 | **** | **** | — | **** | **** | 477 | **** |
| As at June 30, 2019 | **** | 6,035,359,575 | **** | 12,071 | **** | 970 | **** | 529,492 | **** | **** | 2,299 | **** | **** | 28,565 | **** | 15,572 | **** | 2,667 | **** | 1,263 | **** | 592,899 | **** | **** | 2,770 | **** | **** | 595,669 | **** |
4
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
(₹ in millions,except share and per share data, unless otherwise stated)
| Other components ofequity | |||||||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Particulars | Number ofshares* | Sharecapital,fully paid-up | Sharepremium | Retainedearnings | Share-basedpaymentreserve | SEZRe-investmentreserve | Foreigncurrencytranslationreserve | Cashflowhedgingreserve | Otherreserves | Equityattributable tothe equityholders of theCompany | Non-controllinginterest | Total equity | |||||||||||||||||
| As at April 1, 2020 | **** | 5,713,357,390 | **** | 11,427 | **** | 1,275 | **** | 476,103 | **** | **** | 1,550 | **** | **** | 43,804 | **** | 23,539 | **** | (2,315 | ) | **** | 2,075 | **** | 557,458 | **** | 1,875 | **** | **** | 559,333 | **** |
| Comprehensive income for the period | |||||||||||||||||||||||||||||
| Profit for the period | — | — | — | 23,902 | — | — | — | — | — | **** | 23,902 | 211 | **** | 24,113 | **** | ||||||||||||||
| Other comprehensive income | — | — | — | — | — | 1,155 | 808 | 3,090 | **** | 5,053 | (64 | ) | **** | 4,989 | **** | ||||||||||||||
| Total comprehensive income for the period | **** | — | **** | — | **** | — | **** | 23,902 | **** | **** | — | **** | **** | — | **** | 1,155 | **** | 808 | **** | **** | 3,090 | **** | 28,955 | **** | 147 | **** | **** | 29,102 | **** |
| Transaction with owners of the Company, recognized directly in equity | |||||||||||||||||||||||||||||
| Issue of equity shares on exercise of options | 1,081,494 | 2 | 293 | — | (293 | ) | — | — | — | — | **** | 2 | — | **** | 2 | **** | |||||||||||||
| Issue of shares by controlled trust on exercise of options | — | — | — | 83 | (83 | ) | — | — | — | — | **** | — | — | **** | — | **** | |||||||||||||
| Compensation cost related to employee share-based payment | — | — | — | 1 | 338 | — | — | — | — | **** | 339 | — | **** | 339 | **** | ||||||||||||||
| Transferred to special economic zone re-investment<br>reserve | — | — | — | (5,430 | ) | — | 5,430 | — | — | — | **** | — | — | **** | — | **** | |||||||||||||
| Cash dividend paid to Non-controlling interest | — | — | — | — | — | — | — | — | — | **** | — | (960 | ) | **** | (960 | ) | |||||||||||||
| Total transactions with owners of the Company | **** | 1,081,494 | **** | 2 | **** | 293 | **** | (5,346 | ) | **** | (38 | ) | **** | 5,430 | **** | — | **** | — | **** | **** | — | **** | 341 | **** | (960 | ) | **** | (619 | ) |
| As at June 30, 2020 | **** | 5,714,438,884 | **** | 11,429 | **** | 1,568 | **** | 494,659 | **** | **** | 1,512 | **** | **** | 49,234 | **** | 24,694 | **** | (1,507 | ) | **** | 5,165 | **** | 586,754 | **** | 1,062 | **** | **** | 587,816 | **** |
| Convenience translation into US dollar in millions (unaudited) Refer to Note2(iii) | **** | 151 | **** | 21 | **** | 6,549 | **** | **** | 20 | **** | **** | 652 | **** | 327 | **** | (20 | ) | **** | 68 | **** | 7,768 | **** | 14 | **** | **** | 7,782 | **** | ||
| * | Includes 25,788,635 and 22,356,667 treasury shares held as at June 30, 2019 and 2020, respectively by a<br>controlled trust. 1,565,218 and 389,414 shares have been transferred by the controlled trust to eligible employees on exercise of options during the period ended June 30, 2019 and 2020. | ||||||||||||||||||||||||||||
| --- | --- |
The accompanying notes form an integral part of these interim condensed consolidated financial statements
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
|---|---|---|---|
| for Deloitte Haskins & Sells LLP<br><br><br>Chartered Accountants<br> <br>Firm Registration No: 117366W/W -<br>100018 | Rishad A. Premji<br> <br>Chairman | M. K. Sharma<br> <br>Director | Thierry Delaporte<br> <br>Chief Executive<br>Officer &<br> <br>Managing Director |
| Vikas Bagaria<br> <br>Partner<br><br><br>Membership No. 60408 | Jatin Pravinchandra Dalal<br> <br>Chief<br>Financial Officer | M. Sanaulla Khan<br> <br>Company<br>Secretary | |
| Bengaluru | |||
| July 14, 2020 |
5
WIPRO LIMITED AND SUBSIDIARIES
INTERIM CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
(₹ in millions,except share and per share data, unless otherwise stated)
| Three months ended June 30, | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| 2019 | 2020 | 2020 | |||||||
| Convenience translationinto US dollar inmillions (unaudited)Refer to Note 2(iii) | |||||||||
| Cash flows from operating activities: | |||||||||
| Profit for the period | 24,021 | 24,113 | 318 | ||||||
| Adjustments to reconcile profit for the period to net cash generated from operatingactivities: | |||||||||
| (Gain)/ loss on sale of property, plant and equipment and intangible assets, net | (6 | ) | 12 | — | |||||
| Depreciation, amortization and impairment | 4,955 | 6,154 | 81 | ||||||
| Unrealized exchange (gain)/ loss, net and exchange (gain)/ loss on borrowings | 694 | (2,493 | ) | (33 | ) | ||||
| Share-based compensation expense | 471 | 360 | 5 | ||||||
| Share of net (profit)/ loss of associates accounted for using equity method | 16 | (31 | ) | ^ | |||||
| Income tax expense | 6,699 | 6,838 | 91 | ||||||
| Finance and other income, net of finance expenses | (5,673 | ) | (4,279 | ) | (57 | ) | |||
| Gain from sale of business | (699 | ) | (97 | ) | (1 | ) | |||
| Changes in operating assets and liabilities, net of effects from acquisitions | |||||||||
| Trade receivables | 4,698 | 11,651 | 154 | ||||||
| Unbilled receivables and contract assets | (5,646 | ) | 1,411 | 19 | |||||
| Inventories | (191 | ) | 299 | 4 | |||||
| Other assets | (1,236 | ) | 192 | 3 | |||||
| Trade payables, accrued expenses, other liabilities and provisions | (3,205 | ) | 1,502 | 20 | |||||
| Contract liabilities | (2,366 | ) | (507 | ) | (7 | ) | |||
| Cash generated from operating activities before taxes | 22,532 | 45,125 | 597 | ||||||
| Income taxes paid, net | 6,221 | (3,313 | ) | (44 | ) | ||||
| Net cash generated from operating activities | **** | 28,753 | **** | **** | 41,812 | **** | **** | 553 | **** |
| Cash flows from investing activities: | |||||||||
| Purchase of property, plant and equipment | (5,460 | ) | (4,257 | ) | (56 | ) | |||
| Proceeds from sale of property, plant and equipment | 300 | 85 | 1 | ||||||
| Purchase of investments | (258,948 | ) | (261,826 | ) | (3,467 | ) | |||
| Proceeds from sale of investments | 298,606 | 241,018 | 3,191 | ||||||
| Proceeds from sale of business | 7,105 | — | — | ||||||
| Interest received | 8,700 | 5,573 | 74 | ||||||
| Dividend received | 95 | — | — | ||||||
| Net cash (used)/ generated in investing activities | **** | 50,398 | **** | **** | (19,407 | ) | **** | (257 | ) |
| Cash flows from financing activities: | |||||||||
| Proceeds from issuance of equity shares and shares pending allotment | 3 | 2 | ^ | ||||||
| Repayment of loans and borrowings | (14,582 | ) | (24,638 | ) | (326 | ) | |||
| Proceeds from loans and borrowings | 21,118 | 21,690 | 287 | ||||||
| Repayment of lease liabilities | (1,750 | ) | (2,320 | ) | (31 | ) | |||
| Interest paid | (1,255 | ) | (850 | ) | (11 | ) | |||
| Payment of cash dividend to Non-controlling interest<br>holders | — | (960 | ) | (13 | ) | ||||
| Net cash (used)/ generated in financing activities | **** | 3,534 | **** | **** | (7,076 | ) | **** | (94 | ) |
| Net increase in cash and cash equivalents during the period | 82,685 | 15,329 | 202 | ||||||
| Effect of exchange rate changes on cash and cash equivalents | 176 | (138 | ) | (2 | ) | ||||
| Cash and cash equivalents at the beginning of the period | 158,525 | 144,104 | 1,908 | ||||||
| Cash and cash equivalents at the end of the period (Note 9) | **** | 241,386 | **** | **** | 159,295 | **** | **** | 2,108 | **** |
| ^ | Value is less than 1 | ||||||||
| --- | --- |
The accompanying notes form an integral part of these interim condensed consolidated financial statements
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
|---|---|---|---|
| for Deloitte Haskins & Sells LLP<br><br><br>Chartered Accountants<br> <br>Firm Registration No: 117366W/W -<br>100018 | Rishad A. Premji<br> <br>Chairman | M. K. Sharma<br> <br>Director | Thierry Delaporte<br> <br>Chief Executive<br>Officer &<br> <br>Managing Director |
| Vikas Bagaria<br> <br>Partner<br><br><br>Membership No. 60408 | Jatin Pravinchandra Dalal<br> <br>Chief<br>Financial Officer | M. Sanaulla Khan<br> <br>Company<br>Secretary | |
| Bengaluru | |||
| July 14, 2020 |
6
WIPRO LIMITED AND SUBSIDIARIES
NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
(₹ in millions,except share and per share data, unless otherwise stated)
1. The Company overview
Wipro Limited (“Wipro” or the “Parent Company”), together with its subsidiaries and controlled trusts (collectively, “we”, “us”, “our”, “the Company” or the “Group”) is a global information technology (“IT”), consulting and business process services (“BPS”) company.
Wipro is a public limited Company incorporated and domiciled in India. The address of its registered office is Wipro Limited, Doddakannelli, Sarjapur Road, Bengaluru – 560 035, Karnataka, India. Wipro has its primary listing with Bombay Stock Exchange Ltd. and National Stock Exchange of India Ltd. The Company’s American Depository Shares representing equity shares are also listed on the New York Stock Exchange.
These interim condensed consolidated financial statements were authorized for issue by the Company’s Board of Directors on July 14, 2020.
2. Basis of preparation of Interim condensed consolidated financial statements
(i) Statement of compliance and basis of preparation
These interim condensed consolidated financial statements have been prepared in compliance with IAS 34, “Interim Financial Reporting” and in accordance with International Financial Reporting Standards and its interpretations (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). Selected explanatory notes are included to explain events and transactions that are significant to understand the changes in financial position and performance of the Company since the last annual consolidated financial statements as at and for the year ended March 31, 2020. These interim condensed consolidated financial statements do not include all the information required for full annual financial statements prepared in accordance with IFRS.
The interim condensed consolidated financial statements correspond to the classification provisions contained in IAS 1 (revised), “Presentationof Financial Statements”. For clarity, various items are aggregated in the statements of income and statements of financial position. These items are disaggregated separately in the notes, where applicable. The accounting policies have been consistently applied to all periods presented in these interim condensed consolidated financial statements except for the adoption of new accounting standards, amendments and interpretations effective from April 1, 2020.
All amounts included in the interim condensed consolidated financial statements are reported in millions of Indian rupees (₹ in millions) except share and per share data, unless otherwise stated. Due to rounding off, the numbers presented throughout the document may not add up precisely to the totals and percentages may not precisely reflect the absolute figures.
(ii) Basis of measurement
The interim condensed consolidated financial statements have been prepared on a historical cost convention and on an accrual basis, except for the following material items which have been measured at fair value as required by relevant IFRS:
| a. | Derivative financial instruments; |
|---|---|
| b. | Financial instruments classified as fair value through other comprehensive income or fair value through profit<br>or loss; |
| --- | --- |
| c. | The defined benefit asset/ (liability) recognized as the present value of defined benefit obligation less fair<br>value of plan assets; and |
| --- | --- |
| d. | Contingent consideration. |
| --- | --- |
(iii) Convenience translation (unaudited)
The accompanying interim condensed consolidated financial statements have been prepared and reported in Indian rupees, the functional currency of the Parent Company. Solely for the convenience of the readers, the interim condensed consolidated financial statements as at and for the three months ended June 30, 2020, have been translated into United States dollars at the certified foreign exchange rate of US$1 = ₹ 75.53 as published by Federal Reserve Board of Governors on June 30, 2020. No representation is made that the Indian rupee amounts have been, could have been or could be converted into United States dollars at such a rate or any other rate. Due to rounding off, the translated numbers presented throughout the document may not add up precisely to the totals.
(iv) Use of estimates and judgment
The preparation of the interim condensed consolidated financial statements in conformity with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets, liabilities, income and expenses. Actual results may differ from those estimates.
Estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected. In particular, information about significant areas of estimation, uncertainty and critical judgments in applying accounting policies that have the most significant effect on the amounts recognized in the interim condensed consolidated financial statements are included in the following notes:
| a) | Revenue recognition: The Company applies judgement to determine whether each product or service promised<br>to a customer is capable of being distinct, and is distinct in the context of the contract, if not, the promised products or services are combined and accounted as a single performance obligation. The Company allocates the arrangement consideration<br>to separately identifiable performance obligation deliverables based on their relative stand-alone selling price. In cases where the Company is unable to determine the stand-alone selling price the company uses expected cost plus margin approach in<br>estimating the stand-alone selling price. The Company uses the percentage of completion method using the input (cost expended) method to measure progress towards completion in respect of fixed price contracts. Percentage of completion method<br>accounting relies on estimates of total expected |
|---|
7
| contract revenue and costs. This method is followed when reasonably dependable estimates of the revenues and costs applicable to various elements of the contract can be made. Key factors that are<br>reviewed in estimating the future costs to complete include estimates of future labor costs and productivity efficiencies. Because the financial reporting of these contracts depends on estimates that are assessed continually during the term of these<br>contracts, revenue recognized, profit and timing of revenue for remaining performance obligations are subject to revisions as the contract progresses to completion. When estimates indicate that a loss will be incurred, the loss is provided for in<br>the period in which the loss becomes probable. Volume discounts are recorded as a reduction of revenue. When the amount of discount varies with the levels of revenue, volume discount is recorded based on estimate of future revenue from the customer. | |
|---|---|
| b) | Impairment testing: Goodwill and intangible assets with infinite useful life recognized on business<br>combination are tested for impairment at least annually and when events occur or changes in circumstances indicate that the recoverable amount of the asset or the cash generating unit to which these pertain is less than the carrying value. The<br>Company assesses acquired intangible assets with finite useful life for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. The recoverable amount of the asset or the cash generating units<br>is higher of value-in-use and fair value less cost of disposal. The calculation of value in use of an asset or a cash generating unit involves use of significant<br>estimates and assumptions which include turnover, growth rates and net margins used to calculate projected future cash flows, risk-adjusted discount rate, future economic and market conditions. |
| --- | --- |
| c) | Income taxes: **** The major tax jurisdictions for the Company are India and the United States of<br>America. Significant judgments are involved in determining the provision for income taxes including judgment on whether tax positions are probable of being sustained in tax assessments. A tax assessment can involve complex issues, which can only be<br>resolved over extended time periods. |
| --- | --- |
| d) | Deferred taxes: Deferred tax is recorded on temporary differences between the tax bases of assets and<br>liabilities and their carrying amounts, at the rates that have been enacted or substantively enacted at the reporting date. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable profits during the periods<br>in which those temporary differences and tax loss carry-forwards become deductible. The Company considers expected reversal of deferred tax liabilities and projected future taxable income in making this assessment. The amount of deferred tax assets<br>considered realizable, however, could reduce in the near term if estimates of future taxable income during the carry-forward period are reduced. |
| --- | --- |
| e) | Business combination: In accounting for business combinations, judgment is required in identifying<br>whether an identifiable intangible asset is to be recorded separately from goodwill. Additionally, estimating the acquisition date fair value of the identifiable assets (including useful life estimates) and liabilities acquired, and contingent<br>consideration assumed involves management judgment. These measurements are based on information available at the acquisition date and are based on expectations and assumptions that have been deemed reasonable by management. Changes in these<br>judgments, estimates, and assumptions can materially affect the results of operations. |
| --- | --- |
| f) | Defined benefit plans and compensated absences: The cost of the defined benefit plans, compensated<br>absences and the present value of the defined benefit obligations are based on actuarial valuation using the projected unit credit method. An actuarial valuation involves making various assumptions that may differ from actual developments in the<br>future. These include the determination of the discount rate, future salary increases and mortality rates. Due to the complexities involved in the valuation and its long-term nature, a defined benefit obligation is highly sensitive to changes in<br>these assumptions. All assumptions are reviewed at each reporting date. |
| --- | --- |
| g) | Expected credit losses on financial assets: The impairment provisions of financial assets are based on<br>assumptions about risk of default and expected timing of collection. The Company uses judgment in making these assumptions and selecting the inputs to expected credit loss calculation based on the Company’s past history of collections,<br>customer’s creditworthiness, existing market conditions as well as forward looking estimates at the end of each reporting period. |
| --- | --- |
| h) | Measurement of fair value of non-marketable equity investments:<br>These instruments are initially recorded at cost and subsequently measured at fair value. Fair value of investments is determined using the market and income approaches. The market approach includes the use of financial metrics and ratios of<br>comparable companies, such as revenue, earnings, comparable performance multiples, recent financial rounds and the level of marketability of the investments. The selection of comparable companies requires management judgment and is based on number<br>of factors, including comparable company sizes, growth rates, and development stages. The income approach includes the use of discounted cash flow model, which requires significant estimates regarding the investees’ revenue, costs, and discount<br>rates based on the risk profile of comparable companies. Estimates of revenue and costs are developed using available historical and forecast data. |
| --- | --- |
| i) | Useful lives of property, plant and equipment: The Company depreciates property, plant and equipment on<br>a straight-line basis over estimated useful lives of the assets. The charge in respect of periodic depreciation is derived based on an estimate of an asset’s expected useful life and the expected residual value at the end of its life. The life<br>is based on historical experience with similar assets as well as anticipation of future events, which may impact their life, such as changes in technology. The estimated useful life is reviewed at least annually. |
| --- | --- |
| j) | Useful lives of intangible assets: The Company amortizes intangible assets on a straight-line basis over<br>estimated useful lives of the assets. The useful life is estimated based on a number of factors including the effects of obsolescence, demand, competition and other economic factors such as the stability of the industry and known technological<br>advances and the level of maintenance expenditures required to obtain the expected future cash flows from the assets. The estimated useful life is reviewed at least annually. |
| --- | --- |
| k) | Leases: IFRS 16 defines a lease term as the<br>non-cancellable period for which the lessee has the right to use an underlying asset including optional periods, when an entity is reasonably certain to exercise an option to extend (or not to terminate) a<br>lease. The Company considers all relevant facts and circumstances that create an economic incentive for the lessee to exercise the option when determining the lease term. The option to extend the lease term is included in the lease term, if it is<br>reasonably certain that the lessee would exercise the option. The Company reassesses the option when significant events or changes in circumstances occur that are within the control of the lessee. |
| --- | --- |
8
| l) | Other estimates: The share-based compensation expense is determined based on the Company’s<br>estimate of equity instruments that will eventually vest. Fair valuation of derivative hedging instruments designated as cash flow hedges involves significant estimates relating to the occurrence of forecasted transaction. |
|---|---|
| m) | Uncertainty relating to the global health pandemic on COVID-19:<br>In assessing the recoverability of receivables including unbilled receivables, contract assets and contract costs, goodwill, intangible assets, and certain investments, the Company has considered internal and external information up to the<br>date of approval of these interim condensed financial statements including credit reports and economic forecasts. The Company has performed sensitivity analysis on the assumptions used herein. Based on the current indicators of future economic<br>conditions, the Company expects to recover the carrying amount of these assets. |
| --- | --- |
The Company basis its assessment believes that the probability of the occurrence of forecasted transactions is not impacted by COVID-19. The Company has also considered the effect of changes, if any, in both counterparty credit risk and own credit risk while assessing hedge effectiveness and measuring hedge ineffectiveness and continues to believe that there is no impact on effectiveness of its hedges.
The impact of COVID-19 remains uncertain and may be different from what we have estimated as of the date of approval of these interim condensed consolidated financial statements and the Company will continue to closely monitor any material changes to future economic conditions.
3. Significant accounting policies
Please refer to the Company’s Annual report for the year ended March 31, 2020, for a discussion of the Company’s other critical accounting policies except for the adoption of new accounting standards, amendments and interpretations effective on or after April 1, 2020.
New Accounting standards, amendments and interpretations adopted by the Company effective from April 1, 2020:
Amendment to IFRS 3 – Business combination
The International Accounting Standard Board has issued amendments to IFRS 3, ‘Business Combinations’, in connection with clarification of business definition, which help in determining whether an acquisition made is of a business or a group of assets. The amendment added a test that makes it easier to conclude that a Company has acquired a group of assets, rather than a business, if the value of the assets acquired is substantially all concentrated in a single asset or group of similar assets. The adoption of amendment to IFRS 3 is applicable to new acquisition on a prospective basis and hence did not have any impact on the interim condensed consolidated financial statements of the Company.
Amendment to IFRS 9, IAS 39 and IFRS 7 – Interest Rate Benchmark Reform
The IASB amended some of its requirements for hedge accounting. The amendments provide relief from potential effects of the uncertainty caused by the IBOR reform. In addition, the amendments require companies to provide additional information to investors about their hedging relationships that are directly affected by these uncertainties. The adoption of amendment to IFRS 9, IAS 39 and IFRS 7 did not have any significant material impact on the interim condensed consolidated financial statements of the Company.
Amendment to IAS 1 and IAS 8 –Definition of Material
The IASB issued Amendment to IAS 1 Presentation of Financial Statements and IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors to update a new definition of material in IAS 1. The amendments clarify the definition of “material” and how it should be applied by including in the definition guidance that until now has featured elsewhere in IFRS Standards. The new definition clarifies that, information is considered material if omitting, misstating, or obscuring such information, could reasonably be expected to influence the decisions that the primary users of general-purpose financial statements make on the basis of those financial statements. The definition of material in IAS 8 has been replaced by a reference to the definition of material in IAS 1. In addition, the IASB amended other Standards and the Conceptual Framework that contain a definition of material or refer to the term ‘material’ to ensure consistency. The adoption of the amendment to IAS 1 and IAS 8 did not have any material impact on its evaluation of materiality in relation to the interim condensed consolidated financial statements.
Amendment to IFRS 16 – Leases
The IASB issued amendments to IFRS 16, “Leases”, provide lessees with an exemption from assessing whether a COVID-19-related rent concession is a lease modification. The amendments allowed the expedient to be applied to COVID-19-related rent concessions to payments originally due on or before June 30, 2021 and also require disclosure of the amount recognized in profit or loss to reflect changes in lease payments that arise from COVID-19-related rent concessions. The reporting period in which a lessee first applies the amendment, it is not required to disclose certain quantitative information required under IAS 8. Accordingly, the Company recognized ₹ 23 as reversal of lease liability in the interim condensed consolidated statement of income for the three months ended June 30, 2020.
9
New accounting standards not yet adopted:
Certain new standards, amendments to standards and interpretations are not yet effective for annual periods beginning after April 1, 2020 and have not been applied in preparing these interim condensed consolidated financial statements. New standards, amendments to standards and interpretations that could have potential impact on the interim condensed consolidated financial statements of the Company are:
Amendment to IAS 1 – Presentation of Financial Statements
On January 23, 2020, the IASB has issued “Classification of liabilities as Current or Non-Current (Amendments to IAS 1)” providing a more general approach to the classification of liabilities under IAS 1 based on the contractual arrangement in place at the reporting date. The amendments aim to promote consistency in applying the requirements by helping companies to determine whether, in the statement of financial position, debt and other liabilities with an uncertain settlement date should be classified as current (due or potentially due to be settled within one year) or non-current. The amendments also clarified the classification requirements for debt a company might settle by converting it into equity. These amendments are effective for annual reporting periods beginning on or after January 1, 2022 and are to be applied retrospectively, with earlier application permitted. The Company is currently evaluating the impact of amendment to IAS 1 on the consolidated financial statements.
Amendment to IAS 37 – Onerous Contracts – Cost of Fulfilling a Contract
On May 14, 2020, the IASB issued “Onerous Contracts — Cost of Fulfilling a Contract (Amendments to IAS 37)”, amending the standard regarding costs a company should include as the cost of fulfilling a contract when assessing whether a contract is onerous. The amendment specifies that the “cost of fulfilling” a contract comprises the “costs that relate directly to the contract”. Costs that relate directly to a contract can either be incremental costs of fulfilling that contract or an allocation of other costs that relate directly to fulfilling contracts. These amendments are effective for annual reporting periods beginning on or after January 1, 2022, with earlier application is permitted. The Company is currently evaluating the impact of amendment to IAS 37 on the consolidated financial statements.
10
4. Property, plant and equipment
| Land | Buildings | Plant andmachinery * | Furniturefixtures andequipment | Vehicles | Total | ||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Gross carrying value: | |||||||||||||||||
| As at April 1, 2019 | ₹ | 3,697 | ₹ | 27,490 | ₹ | 92,366 | ₹ | 16,505 | ₹ | 948 | ₹ | 141,006 | |||||
| Reclassified on adoption of IFRS 16 | — | — | (3,420 | ) | — | — | (3,420 | ) | |||||||||
| Adjusted balance as at April 1, 2019 | ₹ | 3,697 | ₹ | 27,490 | **** | ₹ | 88,946 | **** | ₹ | 16,505 | **** | ₹ | 948 | **** | ₹ | 137,586 | **** |
| Translation adjustment | 2 | (1 | ) | 88 | 10 | 1 | 100 | ||||||||||
| Additions | — | 515 | 3,787 | 1,248 | 3 | 5,553 | |||||||||||
| Disposals | — | (54 | ) | (989 | ) | (18 | ) | (28 | ) | (1,089 | ) | ||||||
| As at June 30, 2019 | ₹ | 3,699 | ₹ | 27,950 | **** | ₹ | 91,832 | **** | ₹ | 17,745 | **** | ₹ | 924 | **** | ₹ | 142,150 | **** |
| Accumulated depreciation/ impairment: | |||||||||||||||||
| As at April 1, 2019 | ₹ | — | ₹ | 6,715 | ₹ | 73,188 | ₹ | 12,593 | ₹ | 682 | ₹ | 93,178 | |||||
| Reclassified on adoption of IFRS 16 | — | — | (2,177 | ) | — | — | (2,177 | ) | |||||||||
| Adjusted balance as at April 1, 2019 | ₹ | — | ₹ | 6,715 | **** | ₹ | 71,011 | **** | ₹ | 12,593 | **** | ₹ | 682 | **** | ₹ | 91,001 | **** |
| Translation adjustment | — | — | 68 | 6 | 1 | 75 | |||||||||||
| Depreciation and impairment | — | 293 | 2,072 | 423 | 54 | 2,842 | |||||||||||
| Disposals | — | (21 | ) | (589 | ) | (10 | ) | (22 | ) | (642 | ) | ||||||
| As at June 30, 2019 | ₹ | — | ₹ | 6,987 | **** | ₹ | 72,562 | **** | ₹ | 13,012 | **** | ₹ | 715 | **** | ₹ | 93,276 | **** |
| Capital<br>work-in-progress | ₹ | 22,752 | |||||||||||||||
| Net carrying value including Capital work-in-progress as at June 30, 2019 | **** | ₹ | 71,626 | **** | |||||||||||||
| Gross carrying value: | |||||||||||||||||
| As at April 1, 2019 | ₹ | 3,697 | ₹ | 27,490 | ₹ | 92,366 | ₹ | 16,505 | ₹ | 948 | ₹ | 141,006 | |||||
| Reclassified on adoption of IFRS 16 | — | — | (3,420 | ) | — | — | (3,420 | ) | |||||||||
| Adjusted balance as at April 1, 2019 | ₹ | 3,697 | ₹ | 27,490 | **** | ₹ | 88,946 | **** | ₹ | 16,505 | **** | ₹ | 948 | **** | ₹ | 137,586 | **** |
| Translation adjustment | 9 | 84 | 1,437 | 129 | (5 | ) | 1,654 | ||||||||||
| Additions | 55 | 9,130 | 13,571 | 3,487 | 11 | 26,254 | |||||||||||
| Additions through Business combinations | — | 5 | 417 | 7 | — | 429 | |||||||||||
| Disposals | — | (199 | ) | (3,676 | ) | (258 | ) | (146 | ) | (4,279 | ) | ||||||
| As at March 31, 2020 | ₹ | 3,761 | ₹ | 36,510 | **** | ₹ | 100,695 | **** | ₹ | 19,870 | **** | ₹ | 808 | **** | ₹ | 161,644 | **** |
| Accumulated depreciation/ impairment: | |||||||||||||||||
| As at April 1, 2019 | — | ₹ | 6,715 | ₹ | 73,188 | ₹ | 12,593 | ₹ | 682 | ₹ | 93,178 | ||||||
| Reclassified on adoption of IFRS 16 | — | — | (2,177 | ) | — | — | (2,177 | ) | |||||||||
| Adjusted balance as at April 1, 2019 | ₹ | — | ₹ | 6,715 | **** | ₹ | 71,011 | **** | ₹ | 12,593 | **** | ₹ | 682 | **** | ₹ | 91,001 | **** |
| Translation adjustment | — | 32 | 1,066 | 91 | (2 | ) | 1,187 | ||||||||||
| Depreciation and impairment | — | 1,319 | 8,628 | 1,556 | 175 | 11,678 | |||||||||||
| Disposals | — | (118 | ) | (2,649 | ) | (99 | ) | (128 | ) | (2,994 | ) | ||||||
| As at March 31, 2020 | ₹ | — | ₹ | 7,948 | **** | ₹ | 78,056 | **** | ₹ | 14,141 | **** | ₹ | 727 | **** | ₹ | 100,872 | **** |
| Capital<br>work-in-progress | ₹ | 20,348 | |||||||||||||||
| Net carrying value including Capital work-in-progress as at March 31, 2020 | **** | ₹ | 81,120 | **** | |||||||||||||
| Gross carrying value: | |||||||||||||||||
| As at April 1, 2020 | ₹ | 3,761 | ₹ | 36,510 | ₹ | 100,695 | ₹ | 19,870 | ₹ | 808 | ₹ | 161,644 | |||||
| Translation adjustment | 3 | 36 | 383 | 28 | — | 450 | |||||||||||
| Additions | — | 479 | 3,761 | 549 | — | 4,789 | |||||||||||
| Disposals | — | — | (1,064 | ) | (23 | ) | (3 | ) | (1,090 | ) | |||||||
| As at June 30, 2020 | ₹ | 3,764 | ₹ | 37,025 | **** | ₹ | 103,775 | **** | ₹ | 20,424 | **** | ₹ | 805 | **** | ₹ | 165,793 | **** |
| Accumulated depreciation/ impairment: | |||||||||||||||||
| As at April 1, 2020 | — | ₹ | 7,948 | ₹ | 78,056 | ₹ | 14,141 | ₹ | 727 | ₹ | 100,872 | ||||||
| Translation adjustment | — | 13 | 273 | 17 | — | 303 | |||||||||||
| Depreciation and impairment | — | 381 | 2,657 | 452 | 25 | 3,515 | |||||||||||
| Disposals | — | — | (990 | ) | (2 | ) | (3 | ) | (995 | ) | |||||||
| As at June 30, 2020 | ₹ | — | ₹ | 8,342 | **** | ₹ | 79,996 | **** | ₹ | 14,608 | **** | ₹ | 749 | **** | ₹ | 103,695 | **** |
| Capital<br>work-in-progress | ₹ | 19,745 | |||||||||||||||
| Net carrying value including Capital work-in-progress as at June 30, 2020 | **** | ₹ | 81,843 | **** | |||||||||||||
| * | Includes computer equipment and software. | ||||||||||||||||
| --- | --- |
11
5. Right-of-Use assets
| Category of Right-of-Use asset | ||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Land | Buildings | Plant andmachinery * | Vehicles | Total | ||||||||||
| Gross carrying value: | ||||||||||||||
| As at April 1, 2019 | ₹ | 2,003 | ₹ | 11,502 | ₹ | 2,941 | ₹ | 649 | ₹ | 17,095 | ||||
| Additions | — | 436 | 301 | 58 | 795 | |||||||||
| Disposals | — | — | — | (27 | ) | (27 | ) | |||||||
| Translation adjustment | — | 59 | 5 | 3 | 67 | |||||||||
| As at June 30, 2019 | ₹ | 2,003 | ₹ | 11,997 | **** | ₹ | 3,247 | **** | ₹ | 683 | **** | ₹ | 17,930 | **** |
| Accumulated depreciation: | ||||||||||||||
| Depreciation | ₹ | 5 | ₹ | 890 | ₹ | 413 | ₹ | 60 | ₹ | 1,368 | ||||
| Disposals | — | — | — | (1 | ) | (1 | ) | |||||||
| Translation adjustment | — | 19 | — | — | 19 | |||||||||
| As at June 30, 2019 | ₹ | 5 | ₹ | 909 | **** | ₹ | 413 | **** | ₹ | 59 | **** | ₹ | 1,386 | **** |
| Net carrying value as at June 30, 2019 | ₹ | 16,544 | **** | |||||||||||
| Gross carrying value: | ||||||||||||||
| As at April 1, 2019 | ₹ | 2,003 | ₹ | 11,502 | ₹ | 2,941 | ₹ | 649 | ₹ | 17,095 | ||||
| Additions | — | 3,520 | 1,210 | 219 | 4,949 | |||||||||
| Additions through Business combinations | — | 364 | — | — | 364 | |||||||||
| Disposals | — | (41 | ) | (47 | ) | (59 | ) | (147 | ) | |||||
| Translation adjustment | — | 279 | 132 | 17 | 428 | |||||||||
| As at March 31, 2020 | ₹ | 2,003 | ₹ | 15,624 | **** | ₹ | 4,236 | **** | ₹ | 826 | **** | ₹ | 22,689 | **** |
| Accumulated depreciation: | ||||||||||||||
| Depreciation | ₹ | 27 | ₹ | 3,884 | ₹ | 1,731 | ₹ | 269 | ₹ | 5,911 | ||||
| Disposals | — | (18 | ) | (47 | ) | (10 | ) | (75 | ) | |||||
| Translation adjustment | — | 62 | 37 | 6 | 105 | |||||||||
| As at March 31, 2020 | ₹ | 27 | ₹ | 3,928 | **** | ₹ | 1,721 | **** | ₹ | 265 | **** | ₹ | 5,941 | **** |
| Net carrying value as at March 31, 2020 | ₹ | 16,748 | **** | |||||||||||
| Gross carrying value: | ||||||||||||||
| As at April 1, 2020 | ₹ | 2,003 | ₹ | 15,624 | ₹ | 4,236 | ₹ | 826 | ₹ | 22,689 | ||||
| Additions | — | 742 | 66 | 4 | 812 | |||||||||
| Disposals | — | (12 | ) | — | (18 | ) | (30 | ) | ||||||
| Translation adjustment | — | 101 | 28 | 7 | 136 | |||||||||
| As at June 30, 2020 | ₹ | 2,003 | ₹ | 16,455 | **** | ₹ | 4,330 | **** | ₹ | 819 | **** | ₹ | 23,607 | **** |
| Accumulated depreciation: | ||||||||||||||
| As at April 1, 2020 | ₹ | 27 | ₹ | 3,928 | ₹ | 1,721 | ₹ | 265 | ₹ | 5,941 | ||||
| Depreciation | 7 | 1,119 | 427 | 64 | 1,617 | |||||||||
| Disposals | — | (5 | ) | — | (6 | ) | (11 | ) | ||||||
| Translation adjustment | — | 29 | 10 | 3 | 42 | |||||||||
| As at June 30, 2020 | ₹ | 34 | ₹ | 5,071 | **** | ₹ | 2,158 | **** | ₹ | 326 | **** | ₹ | 7,589 | **** |
| Net carrying value as at June 30, 2020 | ₹ | 16,018 | **** | |||||||||||
| * | Includes computer equipment. | |||||||||||||
| --- | --- |
6. Goodwill and intangible assets
The movement in goodwill balance is given below:
| For the period ended | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Balance at the beginning of the period | ₹ | 116,980 | ₹ | 131,012 |
| Translation adjustment | 9,199 | 551 | ||
| Acquisition through business combination, net * | 4,833 | 33 | ||
| Balance at the end of the period | ₹ | 131,012 | ₹ | 131,596 |
| * | Acquisition through business combination for the three months ended June 30, 2020 pertains to change in<br>the purchase price allocation of acquisition during the year ended March 31, 2020. | |||
| --- | --- |
12
The movement in intangible assets is given below:
| Intangible assets | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Customer related | Marketing related | Total | |||||||
| Gross carrying value: | |||||||||
| As at April 1, 2019 | ₹ | 26,924 | ₹ | 5,945 | ₹ | 32,869 | |||
| Translation adjustment | 79 | (5 | ) | 74 | |||||
| As at June 30, 2019 | ₹ | 27,003 | **** | ₹ | 5,940 | **** | ₹ | 32,943 | **** |
| Accumulated amortization/ impairment: | |||||||||
| As at April 1, 2019 | ₹ | 15,345 | ₹ | 3,762 | ₹ | 19,107 | |||
| Translation adjustment | (2 | ) | (5 | ) | (7 | ) | |||
| Amortization | 519 | 226 | 745 | ||||||
| As at June 30, 2019 | ₹ | 15,862 | **** | ₹ | 3,983 | **** | ₹ | 19,845 | **** |
| Net carrying value as at June 30, 2019 | ₹ | 11,141 | **** | ₹ | 1,957 | **** | ₹ | 13,098 | **** |
| Gross carrying value: | |||||||||
| As at April 1, 2019 | ₹ | 26,924 | ₹ | 5,945 | ₹ | 32,869 | |||
| Translation adjustment | 1,031 | 382 | 1,413 | ||||||
| Acquisition through business combinations | 4,535 | 371 | 4,906 | ||||||
| As at March 31, 2020 | ₹ | 32,490 | **** | ₹ | 6,698 | **** | ₹ | 39,188 | **** |
| Accumulated amortization/ impairment: | |||||||||
| As at April 1, 2019 | ₹ | 15,345 | ₹ | 3,762 | ₹ | 19,107 | |||
| Translation adjustment | 220 | 226 | 446 | ||||||
| Amortization | 2,333 | 940 | 3,273 | ||||||
| As at March 31, 2020 | ₹ | 17,898 | **** | ₹ | 4,928 | **** | ₹ | 22,826 | **** |
| Net carrying value as at March 31, 2020 | ₹ | 14,592 | **** | ₹ | 1,770 | **** | ₹ | 16,362 | **** |
| Gross carrying value: | |||||||||
| As at April 1, 2020 | ₹ | 32,490 | ₹ | 6,698 | ₹ | 39,188 | |||
| Translation adjustment | 158 | (1 | ) | 157 | |||||
| As at June 30, 2020 | ₹ | 32,648 | **** | ₹ | 6,697 | **** | ₹ | 39,345 | **** |
| Accumulated amortization/ impairment: | |||||||||
| As at April 1, 2020 | ₹ | 17,898 | ₹ | 4,928 | ₹ | 22,826 | |||
| Translation adjustment | (2 | ) | (2 | ) | (4 | ) | |||
| Amortization | 748 | 274 | 1,022 | ||||||
| As at June 30, 2020 | ₹ | 18,644 | **** | ₹ | 5,200 | **** | ₹ | 23,844 | **** |
| Net carrying value as at June 30, 2020 | ₹ | 14,004 | **** | ₹ | 1,497 | **** | ₹ | 15,501 | **** |
Amortization expense on intangible assets is included in selling and marketing expenses in the interim condensed consolidated statement of income.
7. Investments
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Financial instruments at FVTOCI | ||||
| Equity instruments | ₹ | 9,297 | ₹ | 8,870 |
| Financial instruments at amortized cost | ||||
| Inter corporate and term deposits * | 5 | 5 | ||
| ₹ | 9,302 | ₹ | 8,875 | |
| Current | ||||
| Financial instruments at FVTPL | ||||
| Investments in liquid and short-term mutual funds | ₹ | 14,795 | ₹ | 44,908 |
| Financial instruments at FVTOCI | ||||
| Commercial paper, Certificate of deposits and bonds | 155,587 | 143,827 | ||
| Financial instruments at amortized cost | ||||
| Inter corporate and term deposits * | 19,253 | 25,130 | ||
| ₹ | 189,635 | ₹ | 213,865 | |
| ₹ | 198,937 | ₹ | 222,740 | |
| * | These deposits earn a fixed rate of interest. Term deposits include<br>non- current and current deposits in lien with banks primarily on account of term deposits held as margin money deposits against guarantees amounting to ₹ 5, and ₹ 806, respectively (March 31, 2020: Term deposits non-current<br>of ₹ 5 and Term deposits current of ₹ 796). | |||
| --- | --- |
13
8. Inventories
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Stores and spare parts | ₹ | 613 | ₹ | 569 |
| Finished and traded goods | 1,252 | 1,075 | ||
| ₹ | 1,865 | ₹ | 1,644 |
9. Cash and cash equivalents:
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Cash and bank balances | ₹ | 34,087 | ₹ | 43,731 |
| Demand deposits with banks * | 110,412 | 115,712 | ||
| ₹ | 144,499 | ₹ | 159,443 | |
| * | These deposits can be withdrawn by the Company at any time without prior notice and without any penalty on the<br>principal. | |||
| --- | --- |
Cash and cash equivalents consist of the following for the purpose of the cash flow statement:
| As at | ||||||
|---|---|---|---|---|---|---|
| June 30, 2019 | June 30, 2020 | |||||
| Cash and cash equivalents | ₹ | 241,405 | ₹ | 159,443 | ||
| Bank overdrafts | (19 | ) | (148 | ) | ||
| ₹ | 241,386 | **** | ₹ | 159,295 | **** |
10. Other financial assets
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Security deposits | ₹ | 1,581 | ₹ | 1,533 |
| Interest receivables | 1,139 | 1,139 | ||
| Finance lease receivables | 2,359 | 3,039 | ||
| Other deposits | 802 | 643 | ||
| ₹ | 5,881 | ₹ | 6,354 | |
| Current | ||||
| Security deposits | ₹ | 1,127 | ₹ | 1,177 |
| Dues from officers and employees | 1,040 | 654 | ||
| Finance lease receivables | 2,811 | 3,303 | ||
| Interest receivables | 2,581 | 3,388 | ||
| Other deposits | 5 | 2 | ||
| Others | 1,050 | 2,002 | ||
| ₹ | 8,614 | ₹ | 10,526 | |
| ₹ | 14,495 | ₹ | 16,880 |
11. Other assets
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Prepaid expenses | ₹ | 4,535 | ₹ | 3,940 |
| Costs to obtain contract* | 4,030 | 3,935 | ||
| Costs to fulfil contract | 305 | 331 | ||
| Others | 3,065 | 3,251 | ||
| ₹ | 11,935 | ₹ | 11,457 | |
| Current | ||||
| Prepaid expenses | ₹ | 9,876 | ₹ | 11,842 |
| Dues from officers and employees | 310 | 235 | ||
| Advance to suppliers | 3,121 | 2,276 | ||
| Balance with GST and other authorities | 7,805 | 8,079 | ||
| Costs to obtain contract* | 1,258 | 985 | ||
| Others | 135 | 167 | ||
| ₹ | 22,505 | ₹ | 23,584 | |
| ₹ | 34,440 | ₹ | 35,041 | |
| * | Amortization during the three months ended June 30, 2019, and 2020 amounting to ₹ 295 and ₹ 365 respectively. | |||
| --- | --- |
14
12. Loans, borrowings and bank overdrafts
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Borrowings from banks | ₹ | 77,058 | ₹ | 73,623 |
| Bank overdrafts | 395 | 148 | ||
| Loans from institutions other than bank | 589 | 466 | ||
| ₹ | 78,042 | ₹ | 74,237 | |
| Non-current | 4,840 | 4,747 | ||
| Current | 73,202 | 69,490 |
13. Other financial liabilities
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Cash Settled ADS RSUs | ₹ | 146 | ₹ | 187 |
| Deposits and others | 5 | 5 | ||
| ₹ | 151 | ₹ | 192 | |
| Current | ||||
| Cash Settled ADS RSUs | ₹ | 350 | ₹ | 327 |
| Deposits and others | 549 | 558 | ||
| ₹ | 899 | ₹ | 885 | |
| ₹ | 1,050 | ₹ | 1,077 |
14. Other liabilities
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Employee benefits obligations | ₹ | 3,767 | ₹ | 4,365 |
| Others | 3,770 | 3,928 | ||
| ₹ | 7,537 | ₹ | 8,293 | |
| Current | ||||
| Statutory and other liabilities | ₹ | 4,919 | ₹ | 7,851 |
| Employee benefits obligations | 12,356 | 13,876 | ||
| Advance from customers | 1,464 | 1,289 | ||
| Others | 515 | 530 | ||
| ₹ | 19,254 | ₹ | 23,546 | |
| ₹ | 26,791 | ₹ | 31,839 |
15. Provisions
| As at | ||||
|---|---|---|---|---|
| March 31, 2020 | June 30, 2020 | |||
| Non-current | ||||
| Provision for warranty | ₹ | 2 | ₹ | 4 |
| ₹ | 2 | ₹ | 4 | |
| Current | ||||
| Provision for warranty | ₹ | 317 | ₹ | 304 |
| Others | 295 | 555 | ||
| ₹ | 612 | ₹ | 859 | |
| ₹ | 614 | ₹ | 863 |
Provision for warranty represents cost associated with providing sales support services which are accrued at the time of recognition of revenues and are expected to be utilized over a period of 1 to 2 years. Other provisions primarily include provisions for compliance related contingencies. The timing of cash outflows in respect of such provision cannot be reasonably determined.
16. Financial instruments:
Derivative assets and liabilities:
The Company is exposed to foreign currency fluctuations on foreign currency assets / liabilities, forecasted cash flows denominated in foreign currency and net investment in foreign operations. The Company follows established risk management policies, including the use of derivatives to hedge foreign currency assets / liabilities, foreign currency forecasted cash flows and net investment in foreign operations. The counter parties in these derivative instruments are primarily banks and the Company considers the risks of non-performance by the counterparty as non-material.
15
The following table presents the aggregate contracted principal amounts of the Company’s derivative contracts outstanding:
| (in millions) | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| As at | ||||||||||
| March 31, 2020 | June 30, 2020 | |||||||||
| Notional | Fair value | Notional | Fair value | |||||||
| Designated derivative instruments | ||||||||||
| Sell: Forward contracts | USD | 1,011 | ₹ | (2,902 | ) | USD | 1,254 | ₹ | (1,808 | ) |
| € | 121 | ₹ | 231 | € | 109 | ₹ | (29 | ) | ||
| £ | 52 | ₹ | 240 | £ | 64 | ₹ | 274 | |||
| AUD | 144 | ₹ | 741 | AUD | 136 | ₹ | (123 | ) | ||
| Range forward option contracts | USD | 474 | ₹ | (1,057 | ) | USD | 319 | ₹ | (106 | ) |
| £ | 98 | ₹ | (13 | ) | £ | 63 | ₹ | (13 | ) | |
| € | 39 | ₹ | 85 | € | 30 | ₹ | 18 | |||
| Non-designated derivative instruments | ||||||||||
| Sell: Forward contracts * | USD | 1,314 | ₹ | (3,116 | ) | USD | 1,381 | ₹ | 854 | |
| € | 59 | ₹ | 34 | € | 100 | ₹ | (179 | ) | ||
| £ | 81 | ₹ | 112 | £ | 78 | ₹ | 91 | |||
| AUD | 56 | ₹ | 115 | AUD | 46 | ₹ | (41 | ) | ||
| SGD | 7 | ₹ | 8 | SGD | 7 | ₹ | (2 | ) | ||
| ZAR | 17 | ₹ | 1 | ZAR | 22 | ^ | ||||
| CAD | 51 | ₹ | 153 | CAD | 32 | ₹ | (44 | ) | ||
| SAR | 60 | ₹ | (1 | ) | SAR | 76 | ₹ | (1 | ) | |
| AED | — | — | AED | 15 | ^ | |||||
| PLN | 34 | ₹ | 13 | PLN | 18 | ₹ | (9 | ) | ||
| CHF | 7 | ₹ | 4 | CHF | 2 | ₹ | (3 | ) | ||
| QAR | 19 | ₹ | (8 | ) | QAR | 13 | ₹ | (5 | ) | |
| TRY | 30 | ₹ | 31 | TRY | 30 | ₹ | (16 | ) | ||
| NOK | 19 | ₹ | 16 | NOK | 19 | ₹ | (2 | ) | ||
| OMR | 2 | ₹ | 1 | OMR | 2 | ₹ | (5 | ) | ||
| SEK | 13 | ₹ | 4 | SEK | 29 | ₹ | (3 | ) | ||
| MYR | 20 | ₹ | 1 | MYR | 11 | ₹ | (1 | ) | ||
| JPY | 325 | ^ | JPY | 500 | ₹ | 1 | ||||
| Buy: Forward contracts | USD | 480 | ₹ | 972 | USD | 250 | ₹ | (43 | ) | |
| MXN | 11 | ₹ | (9 | ) | MXN | 11 | ₹ | 2 | ||
| € | — | — | € | 1 | ^ | |||||
| SEK | — | — | SEK | 37 | ₹ | 21 | ||||
| DKK | 9 | ^ | DKK | 44 | ₹ | 13 | ||||
| ₹ | (4,344 | ) | ₹ | (1,159 | ) | |||||
| ^ | Value is less than ₹ 1.<br> | |||||||||
| --- | --- | |||||||||
| * | USD 1,314 and USD 1,381 includes USD/PHP sell forward of USD 176 and USD 194 as at March 31, 2020 and<br>June 30, 2020, respectively. | |||||||||
| --- | --- |
The following table summarizes activity in the cash flow hedging reserve within equity related to all derivative instruments classified as cash flow hedges:
| Three months endedJune 30, | ||||||
|---|---|---|---|---|---|---|
| 2019 | 2020 | |||||
| Balance as at the beginning of the period | ₹ | 3,019 | ₹ | (2,876 | ) | |
| Deferred cancellation gain/(loss), net | — | 112 | ||||
| Changes in fair value of effective portion of derivatives | 933 | 146 | ||||
| Net gain/(loss) reclassified to interim condensed consolidated statement of income on occurrence<br>of hedged transactions * | (621 | ) | 743 | |||
| Gain/(loss) on cash flow hedging derivatives, net | ₹ | 312 | ₹ | 1,001 | ||
| Balance as at the end of the period | **** | 3,331 | **** | **** | (1,875 | ) |
| Deferred tax thereon | (664 | ) | 368 | |||
| Balance as at the end of the period, net of deferred tax | ₹ | 2,667 | **** | ₹ | (1,507 | ) |
| * | Includes net gain/(loss) reclassified to revenue (June 30, 2019: ₹ (890), June 30, 2020: ₹ 955) and cost of revenues (June 30, 2019: ₹ 269, June 30, 2020: ₹ (212)). | |||||
| --- | --- |
As at June 30, 2019 and 2020, there were no significant gains or losses on derivative transactions or portions thereof that have become ineffective as hedges or associated with an underlying exposure that did not occur.
16
Fair value:
Financial assets and liabilities include cash and cash equivalents, trade receivables, unbilled receivables, finance lease receivables, employee and other advances, eligible current and non-current assets, loans, borrowings and bank overdrafts, trade payable and accrued expenses, and eligible current liabilities and non-current liabilities.
The fair value of cash and cash equivalents, trade receivables, unbilled receivables, loans, borrowings and bank overdrafts, trade payables and accrued expenses, other current financial assets and liabilities approximate their carrying amount largely due to the short-term nature of these instruments. The Company’s long-term debt has been contracted at market rates of interest. Accordingly, the carrying value of such long-term debt approximates fair value. Further, finance lease receivables are periodically evaluated based on individual credit worthiness of customers. Based on this evaluation, the Company records allowance for estimated losses on these receivables. As at March 31, 2020 and June 30, 2020, the carrying value of such receivables, net of allowances approximates the fair value.
Investments in liquid and short-term mutual funds, which are classified as FVTPL are measured using net asset values at the reporting date multiplied by the quantity held. Fair value of investments in commercial papers, certificate of deposits and bonds classified as FVTOCI is determined based on the indicative quotes of price and yields prevailing in the market at the reporting date. Fair value of investments in equity instruments classified as FVTOCI is determined using market and income approaches.
The fair value of derivative financial instruments is determined based on observable market inputs including currency spot and forward rates, yield curves, currency volatility etc.
Fairvalue hierarchy
The table below analyses financial instruments carried at fair value, by valuation method. The different levels have been defined as follows:
Level 1 – Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 – Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 – Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
The following table presents fair value of hierarchy of assets and liabilities measured at fair value on a recurring basis:
| Particular | As at March 31, 2020 | As at June 30, 2020 | ||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Fair value measurements at reporting date | Fair value measurements at reporting date | |||||||||||||||||||
| Total | Level 1 | Level 2 | Level 3 | Total | Level 1 | Level 2 | Level 3 | |||||||||||||
| Assets | ||||||||||||||||||||
| Derivative instruments: | ||||||||||||||||||||
| Cash flow hedges | ₹ | 1,382 | ₹ | — | ₹ | 1,382 | ₹ | — | ₹ | 642 | ₹ | — | ₹ | 642 | ₹ | — | ||||
| Others | 1,643 | — | 1,643 | — | 1,024 | — | 1,024 | — | ||||||||||||
| Investments: | ||||||||||||||||||||
| Investment in liquid and short-term mutual funds | 14,795 | 14,795 | — | — | 44,908 | 44,908 | — | — | ||||||||||||
| Investment in equity instruments | 9,297 | — | 119 | 9,178 | 8,870 | — | 230 | 8,640 | ||||||||||||
| Commercial paper, Certificate of deposits and bonds | 155,587 | 12,983 | 142,604 | — | 143,827 | — | 143,827 | — | ||||||||||||
| Liabilities | ||||||||||||||||||||
| Derivative instruments: | ||||||||||||||||||||
| Cash flow hedges | ₹ | (4,057 | ) | ₹ | — | ₹ | (4,057 | ) | ₹ | — | ₹ | (2,429 | ) | ₹ | — | ₹ | (2,429 | ) | ₹ | — |
| Others | (3,312 | ) | — | (3,312 | ) | — | (396 | ) | — | (396 | ) | — |
The following methods and assumptions were used to estimate the fair value of the level 2 financial instruments included in the above table.
Derivative instruments (assets and liabilities): The Company enters derivative financial instruments with various counterparties, primarily banks with investment grade credit ratings. Derivatives valued using valuation techniques with market observable inputs are mainly interest rate swaps, foreign exchange forward contracts and foreign exchange option contracts. The most frequently applied valuation techniques include forward pricing, swap models and Black Scholes models (for option valuation), using present value calculations. The models incorporate various inputs including the credit quality of counterparties, foreign exchange spot and forward rates, interest rate curves and forward rate curves of the underlying. As at June 30, 2020, the changes in counterparty credit risk had no material effect on the hedge effectiveness assessment for derivatives designated in hedge relationships and other financial instruments recognized at fair value.
Investment in commercial papers, certificate of depositsand bonds: Fair value of these instruments is derived based on the indicative quotes of price and yields prevailing in the market as at reporting date.
The following methods and assumptions were used to estimate the fair value of the level 3 financial instruments included in the above table.
17
Investment in equity instruments: Fair value of these instruments is determined using market and income approaches.
Details of assets and liabilities considered under Level 3 classification
| As at | ||||||
|---|---|---|---|---|---|---|
| Investment in equity instruments | March 31, 2020 | June 30, 2020 | ||||
| Balance at the beginning of the period | ₹ | 6,668 | ₹ | 9,178 | ||
| Additions | 2,124 | 395 | ||||
| Disposals | (1,327 | ) | (1,274 | ) | ||
| Gain/(loss) recognized in foreign currency translation reserve | 855 | (7 | ) | |||
| Gain/(loss) recognized in other comprehensive income | 858 | 348 | ||||
| Balance at the end of the period | ₹ | 9,178 | **** | ₹ | 8,640 | **** |
17. Foreign currency translation reserve
The movement in foreign currency translation reserve attributable to equity holders of the Company is summarized below:
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Balance at the beginning of the period | ₹ | 15,250 | ₹ | 23,539 |
| Translation difference related to foreign operations, net | 322 | 1,155 | ||
| Balance at the end of the period | ₹ | 15,572 | ₹ | 24,694 |
18. Income taxes
| Three months ended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2019 | 2020 | |||||
| Income tax expense as per the interim condensed consolidated statement of income | ₹ | 6,699 | ₹ | 6,838 | ||
| Income tax included in other comprehensive income on: | ||||||
| Unrealized gains/ (losses) on investment securities | (385 | ) | 646 | |||
| Gains/(losses) on cash flow hedging derivatives | 60 | 193 | ||||
| Remeasurements of the net defined benefit liability /(asset) comprising actuarial gains and<br>losses | 65 | (73 | ) | |||
| ₹ | 6,439 | **** | ₹ | 7,604 | **** |
Income tax expense consists of the following:
| Three months ended June 30, | ||||||
|---|---|---|---|---|---|---|
| 2019 | 2020 | |||||
| Current taxes | ||||||
| Domestic | ₹ | 4,705 | ₹ | 4,069 | ||
| Foreign | 1,853 | 1,345 | ||||
| **** | 6,558 | **** | **** | 5,414 | **** | |
| Deferred taxes | ||||||
| Domestic | 356 | 1,983 | ||||
| Foreign | (215 | ) | (559 | ) | ||
| **** | 141 | **** | **** | 1,424 | **** | |
| ₹ | 6,699 | **** | ₹ | 6,838 | **** |
Income tax expenses are net of reversal of taxes pertaining to earlier periods, amounting to ₹ 466, and ₹ 1,112 for the three months ended June 30, 2019 and 2020, respectively.
The Special Economic Zone (“SEZ”) Re-Investment Reserve has been created out of profit of eligible SEZ units as per provisions of section 10AA(1)(ii) of the Income–tax Act, 1961 for acquiring new plant and machinery. The said reserve should be utilized by the Company for acquiring plant and machinery as per terms of Section 10AA(2) of the Income-tax Act, 1961. This reserve is not freely available for distribution.
19. Revenues
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Rendering of services | ₹ | 144,627 | ₹ | 146,834 |
| Sale of products | 2,534 | 2,297 | ||
| ₹ | 147,161 | ₹ | 149,131 |
18
Information on disaggregation of revenues for the three months ended June 30, 2019 is as follows:
| IT Services | ITProducts | ISRE | Total | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| BFSI | HealthBU | CBU | ENU | TECH | MFG | COMM | Total | |||||||||||||||
| A. Revenue | ||||||||||||||||||||||
| Rendering of services | ₹ | 45,083 | ₹ | 18,715 | ₹ | 22,230 | ₹ | 18,297 | ₹ | 18,527 | ₹ | 11,250 | ₹ | 8,400 | ₹ | 142,502 | ₹ | — | ₹ | 2,125 | ₹ | 144,627 |
| Sale of products | — | — | — | — | — | — | — | — | 2,534 | — | **** | 2,534 | ||||||||||
| ₹ | 45,083 | ₹ | 18,715 | ₹ | 22,230 | ₹ | 18,297 | ₹ | 18,527 | ₹ | 11,250 | ₹ | 8,400 | ₹ | 142,502 | ₹ | 2,534 | ₹ | 2,125 | ₹ | 147,161 | |
| B. Revenue by geography | ||||||||||||||||||||||
| India | ₹ | 951 | ₹ | 616 | ₹ | 231 | ₹ | 476 | ₹ | 242 | ₹ | 498 | ₹ | 724 | ₹ | 3,738 | ₹ | 1,559 | ₹ | 2,125 | ₹ | 7,422 |
| Americas * | 26,873 | 14,310 | 15,496 | 5,613 | 13,848 | 5,589 | 2,093 | 83,822 | 291 | — | **** | 84,113 | ||||||||||
| Europe | 11,434 | 2,032 | 4,146 | 7,515 | 3,616 | 4,233 | 2,024 | 35,000 | 328 | — | **** | 35,328 | ||||||||||
| Rest of the World | 5,825 | 1,757 | 2,357 | 4,693 | 821 | 930 | 3,559 | 19,942 | 356 | — | **** | 20,298 | ||||||||||
| ₹ | 45,083 | ₹ | 18,715 | ₹ | 22,230 | ₹ | 18,297 | ₹ | 18,527 | ₹ | 11,250 | ₹ | 8,400 | ₹ | 142,502 | ₹ | 2,534 | ₹ | 2,125 | ₹ | 147,161 | |
| C. Revenue by nature of contract | ||||||||||||||||||||||
| Fixed price and volume based | ₹ | 25,400 | ₹ | 11,988 | ₹ | 12,359 | ₹ | 12,770 | ₹ | 11,382 | ₹ | 7,945 | ₹ | 5,208 | ₹ | 87,052 | ₹ | — | ₹ | 1,649 | ₹ | 88,701 |
| Time and materials | 19,683 | 6,727 | 9,871 | 5,527 | 7,145 | 3,305 | 3,192 | 55,450 | — | 476 | **** | 55,926 | ||||||||||
| Products | — | — | — | — | — | — | — | — | 2,534 | — | **** | 2,534 | ||||||||||
| ₹ | 45,083 | ₹ | 18,715 | ₹ | 22,230 | ₹ | 18,297 | ₹ | 18,527 | ₹ | 11,250 | ₹ | 8,400 | ₹ | 142,502 | ₹ | 2,534 | ₹ | 2,125 | ₹ | 147,161 |
Information on disaggregation of revenues for the three months ended June 30, 2020 is as follows:
| IT Services | ITProducts | ISRE | Total | |||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| BFSI | HealthBU | CBU | ENU | TECH | MFG | COMM | Total | |||||||||||||||
| A. Revenue | ||||||||||||||||||||||
| Rendering of services | ₹ | 44,432 | ₹ | 19,613 | ₹ | 23,005 | ₹ | 19,101 | ₹ | 19,498 | ₹ | 11,713 | ₹ | 7,355 | ₹ | 144,717 | ₹ | — | ₹ | 2,117 | ₹ | 146,834 |
| Sale of products | — | — | — | — | — | — | — | — | 2,297 | — | **** | 2,297 | ||||||||||
| ₹ | 44,432 | ₹ | 19,613 | ₹ | 23,005 | ₹ | 19,101 | ₹ | 19,498 | ₹ | 11,713 | ₹ | 7,355 | ₹ | 144,717 | ₹ | 2,297 | ₹ | 2,117 | ₹ | 149,131 | |
| B. Revenue by geography | ||||||||||||||||||||||
| India | ₹ | 1,604 | ₹ | 640 | ₹ | 218 | ₹ | 442 | ₹ | 118 | ₹ | 434 | ₹ | 324 | ₹ | 3,780 | ₹ | 1,252 | ₹ | 2,117 | ₹ | 7,149 |
| Americas * | 25,773 | 14,946 | 16,074 | 5,901 | 15,434 | 5,783 | 1,556 | 85,467 | 91 | — | **** | 85,558 | ||||||||||
| Europe | 10,690 | 1,996 | 4,136 | 7,948 | 2,916 | 4,627 | 1,949 | 34,262 | 577 | — | **** | 34,839 | ||||||||||
| Rest of the World | 6,365 | 2,031 | 2,577 | 4,810 | 1,030 | 869 | 3,526 | 21,208 | 377 | — | **** | 21,585 | ||||||||||
| ₹ | 44,432 | ₹ | 19,613 | ₹ | 23,005 | ₹ | 19,101 | ₹ | 19,498 | ₹ | 11,713 | ₹ | 7,355 | ₹ | 144,717 | ₹ | 2,297 | ₹ | 2,117 | ₹ | 149,131 | |
| C. Revenue by nature of contract | ||||||||||||||||||||||
| Fixed price and volume based | ₹ | 24,946 | ₹ | 13,695 | ₹ | 11,943 | ₹ | 12,716 | ₹ | 13,449 | ₹ | 8,400 | ₹ | 5,221 | ₹ | 90,370 | ₹ | — | ₹ | 1,608 | ₹ | 91,978 |
| Time and materials | 19,486 | 5,918 | 11,062 | 6,385 | 6,049 | 3,313 | 2,134 | 54,347 | — | 509 | **** | 54,856 | ||||||||||
| Products | — | — | — | — | — | — | — | — | 2,297 | — | **** | 2,297 | ||||||||||
| ₹ | 44,432 | ₹ | 19,613 | ₹ | 23,005 | ₹ | 19,101 | ₹ | 19,498 | ₹ | 11,713 | ₹ | 7,355 | ₹ | 144,717 | ₹ | 2,297 | ₹ | 2,117 | ₹ | 149,131 | |
| * | Substantially related to operations in the United States of America. | |||||||||||||||||||||
| --- | --- |
19
20. Expenses by nature
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Employee compensation | ₹ | 77,476 | 80,262 | |
| Sub-contracting/ technical fees | 22,563 | 21,218 | ||
| Cost of hardware and software | 2,810 | 2,009 | ||
| Travel | 4,633 | 1,290 | ||
| Facility expenses | 4,733 | 4,627 | ||
| Depreciation, amortization and impairment | 4,955 | 6,154 | ||
| Communication | 1,136 | 1,354 | ||
| Legal and professional fees | 1,096 | 1,311 | ||
| Rates, taxes and insurance | 737 | 1,030 | ||
| Marketing and brand building | 772 | 129 | ||
| Lifetime expected credit loss | 531 | 1,589 | ||
| Miscellaneous expenses* | 1,903 | 2,522 | ||
| Total cost of revenues, selling and marketing expenses and general and administrativeexpenses | ₹ | 123,345 | ₹ | 123,495 |
| * | Miscellaneous expenses for the three months ended June 30, 2020, include an amount of ₹ 991 towards COVID-19 contributions. | |||
| --- | --- |
21. Finance expenses
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Interest expense | ₹ | 1,277 | ₹ | 1,002 |
| Exchange fluctuation on foreign currency borrowings, net | 307 | 297 | ||
| ₹ | 1,584 | ₹ | 1,299 |
22. Finance and other income and Foreign exchange gains/(losses), net
| Three months ended June 30, | |||||
|---|---|---|---|---|---|
| 2019 | 2020 | ||||
| Interest income | ₹ | 6,413 | ₹ | 4,853 | |
| Dividend income | 95 | — | |||
| Net gain from investments classified as FVTPL | 151 | 233 | |||
| Net gain from investments classified as FVTOCI | 288 | 195 | |||
| Finance and other income | ₹ | 6,947 | **** | ₹ | 5,281 |
| Foreign exchange gains/(losses), net, on financial instruments measured at FVTPL | ₹ | 1,398 | ₹ | 773 | |
| OtherForeign exchange gains/(losses), net | (540 | ) | 432 | ||
| Foreign exchange gains/(losses), net | ₹ | 858 | **** | ₹ | 1,205 |
| ₹ | 7,805 | **** | ₹ | 6,486 |
23. Earnings per share:
A reconciliation of profit for the period and equity shares used in the computation of basic and diluted earnings per equity share is set out below:
Basic: Basic earnings per share is calculated by dividing the profit attributable to equity shareholders of the Company by the weighted average number of equity shares outstanding during the period, excluding equity shares purchased by the Company and held as treasury shares.
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Profit attributable to equity holders of the Company | ₹ | 23,874 | ₹ | 23,902 |
| Weighted average number of equity shares outstanding | 6,010,597,369 | 5,693,348,171 | ||
| Basic earnings per share | ₹ | 3.97 | ₹ | 4.20 |
Diluted: Diluted earnings per share is calculated by adjusting the weighted average number of equity shares outstanding during the period for assumed conversion of all dilutive potential equity shares. Employee share options are dilutive potential equity shares for the Company.
The calculation is performed in respect of share options to determine the number of shares that could have been acquired at fair value (determined as the average market price of the Company’s shares during the period). The number of shares calculated as above is compared with the number of shares that would have been issued assuming the exercise of the share options.
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Profit attributable to equity holders of the Company | ₹ | 23,874 | ₹ | 23,902 |
| Weighted average number of equity shares outstanding | 6,010,597,369 | 5,693,348,171 | ||
| Effect of dilutive equivalent share options | 14,755,073 | 9,820,077 | ||
| Weighted average number of equity shares for diluted earnings per share | 6,025,352,442 | 5,703,168,248 | ||
| Diluted earnings per share | ₹ | 3.96 | ₹ | 4.19 |
20
24. Employee benefits
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Salaries and bonus | ₹ | 74,625 | ₹ | 77,202 |
| Employee benefits plans | ||||
| Gratuity and other defined benefit plans | 393 | 500 | ||
| Defined contribution plans | 1,987 | 2,200 | ||
| Share-based compensation | 471 | 360 | ||
| ₹ | 77,476 | ₹ | 80,262 |
The employee benefit cost is recognized in the following line items in the interim condensed consolidated statement of income:
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| Cost of revenues | ₹ | 65,939 | ₹ | 68,345 |
| Selling and marketing expenses | 7,610 | 7,909 | ||
| General and administrative expenses | 3,927 | 4,008 | ||
| ₹ | 77,476 | ₹ | 80,262 |
The Company has granted 50,000 options under RSU option plan during the three months ended June 30, 2020 (10,000 for the three months ended June 30, 2019); 16,000 options under ADS option plan during the three months ended June 30, 2020 (100,000 for three months ended June 30, 2019).
The Company has also granted 60,000 Performance based stock options (RSU) during the three months ended June 30, 2020 (Nil for the three months ended June 30, 2019); 24,000 Performance based stock options (ADS) during the three months ended June 30, 2020 (Nil for three months ended June 30, 2019).
The RSU grants were issued under Wipro Employee Restricted Stock Unit plan 2007 (WSRUP 2007 plan) and the ADS grants were issued under Wipro ADS Restricted Stock Unit Plan (WARSUP 2004 plan).
25. Other operating income
The Company has partially met the first and second-year business targets pertaining to sale of hosted data center business concluded during the year ended March 31, 2019. Change in fair value of the callable units pertaining to achievement of the business targets amounting to ₹ 597, and ₹ 97 for the three months ended June 30, 2019, and June 30, 2020, respectively has been recognized under other operating income.
The Company concluded the sale of assets pertaining to Workday business and Cornerstone OnDemand business in Portugal, France and Sweden during the year ended March 31, 2020. Gain arising from such transaction of ₹ 102 for the three months ended June 30, 2019 has been recognized under other operating income.
| 26. | Commitments and contingencies |
|---|
Capital commitments: As at March 31, 2020 and June 30, 2020 the Company had committed to spend approximately ₹ 14,011 and ₹ 9,586 respectively, under agreements to purchase/ construct property and equipment. These amounts are net of capital advances paid in respect of these purchases.
Guarantees: As at March 31, 2020 and June 30, 2020, performance and financial guarantees provided by banks on behalf of the Company to the Indian Government, customers and certain other agencies amount to approximately ₹ 18,655 and ₹ 19,846 respectively, as part of the bank line of credit.
Contingencies and lawsuits: The Company is subject to legal proceedings and claims (including tax assessment orders/ penalty notices) which have arisen in the ordinary course of its business. Some of the claims involve complex issues and it is not possible to make a reasonable estimate of the expected financial effect, if any, that will result from ultimate resolution of such proceedings. However, the resolution of these legal proceedings is not likely to have a material and adverse effect on the results of operations or the financial position of the Company. The significant of such matters are discussed below.
In March 2004, the Company received a tax demand for year ended March 31, 2001 arising primarily on account of denial of deduction under section 10A of the Income Tax Act, 1961 in respect of profit earned by the Company’s undertaking in Software Technology Park at Bengaluru. The same issue was repeated in the successive assessments for the years ended March 31, 2002 to March 31, 2011 and the aggregate demand is ₹ 47,583 (including interest of ₹ 13,832). The appeals filed against the said demand before the Appellate authorities have been allowed in favor of the Company by the second appellate authority for the years up to March 31, 2008. Further appeals have been filed by the Income tax authorities before the Hon’ble High Court. The Hon’ble High Court has heard and disposed-off majority of the issues in favor of the Company up to years ended March 31, 2004. Department has filed a Special Leave Petition before the Supreme Court of India for the year ended March 31, 2001 to March 31, 2004.
On similar issues for years up to March 31, 2000, the Hon’ble High Court of Karnataka has upheld the claim of the Company under section 10A of the Income Tax Act, 1961. For the year ended March 31, 2009, the appeals are pending before Income Tax Appellate Tribunal (“ITAT”). For years ended March 31, 2010 and March 31, 2011, the Dispute Resolution Panel allowed the claim of the Company under section 10A of the Income Tax Act, 1961. The Income tax authorities have filed an appeal before the Hon’ble ITAT.
21
For the year ended March 31, 2013, the Company received the final assessment order in November 2017 with a demand of ₹ 3,286 (including interest of ₹ 1,166), arising primarily on account of section 10AA issues with respect to exclusion from Export Turnover. The Company has filed an appeal before Hon’ble ITAT, Bengaluru within the prescribed timelines.
For the year ended March 31, 2014, the Company received the final assessment order in September 2018 with a demand of ₹ 1,030 (including nil interest), arising primarily on account of transfer pricing issues. The Company has filed an appeal before the Hon’ble ITAT, Bengaluru within the prescribed timelines.
For the year ended March 31, 2015, the Company received the final assessment order in October 2019 with an estimated demand of ₹ 1,347 (including nil interest), arising primarily on account of capitalization of wages. The Company has filed an appeal before the Hon’ble ITAT, Bengaluru within the prescribed timelines.
For the year ended March 31, 2016, the Company received the draft assessment order in December 2019 with an estimated demand of ₹ 704 (including nil interest), arising primarily on account of capitalization of wages. The Company has filed the objections before the Dispute Resolution Panel (Bengaluru) within the prescribed timelines.
For the year ended March 31, 2007 to year ended March 31, 2012, the company has received tax demand of ₹ 227 (including interest of ₹ 102) for non-deduction of tax at source on some payments. The Company has already deposited the demand under protest. The Company received order issued by ITAT, Bengaluru rejecting Company’s appeal. The Company has filed an appeal against the said order with the Hon’ble High Court of Karnataka within the prescribed timelines. The Company has received a favorable order on this issue from the Hon’ble High Court of Karnataka for the earlier years.
Income tax demands against the Company amounting to ₹ 77,873 and ₹ 78,591 are not acknowledged as debt as at March 31, 2020 and June 30, 2020, respectively. These matters are pending before various Appellate Authorities and the management expects its position will likely be upheld on ultimate resolution and will not have a material adverse effect on the Company’s financial position and results of operations.
The contingent liability in respect of disputed demands for excise duty, custom duty, sales tax and other matters amounting to ₹ 8,033 and ₹ 10,388 as of March 31, 2020 and June 30, 2020, respectively. However, the resolution of these disputed demands is not likely to have a material and adverse effect on the results of operations or the financial position of the Company.
The Hon’ble Supreme Court of India, through a ruling in February 2019, provided interpretation on the components of Salary on which the Company and its employees are to contribute towards Provident Fund under the Employee’s Provident Fund Act. Based on the current evaluation, the Company believes it is not probable that certain components of Salary paid by the Company will be subject to contribution towards Provident Fund due to the Supreme Court order. The Company will continue to monitor and evaluate its position based on future events and developments.
| 27. | Segment information |
|---|
The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (“ISRE”).
IT Services: The IT Services segment primarily consists of IT Service offerings to customers organized by industry verticals. The industry verticals are as follows: Banking, Financial Services and Insurance (“BFSI”), Health Business unit (“Health BU”), Consumer Business unit (“CBU”), Energy, Natural Resources & Utilities (“ENU”), Manufacturing (“MFG”), Technology (“TECH”) and Communications (“COMM”). Key service offerings to customers includes software application development and maintenance, research and development services for hardware and software design, business application services, analytics, consulting, infrastructure outsourcing services and business process services.
IT Products: The Company is a value-added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to the above items is reported as revenue from the sale of IT Products.
ISRE: This segment consists of IT Services offerings to entities or departments owned or controlled by Government of India and/ or any State Governments.
The Chairman of the Company has been identified as the Chief Operating Decision Maker (“CODM”) as defined by IFRS 8, “Operating Segments.” The Chairman of the Company evaluates the segments based on their revenue growth and operating income.
Assets and liabilities used in the Company’s business are not identified to any of the operating segments, as these are used interchangeably between segments. Management believes that it is currently not practicable to provide segment disclosures relating to total assets and liabilities since a meaningful segregation of the available data is onerous.
22
Information on reportable segment for the three months ended June 30, 2019, is as follows:
| IT Services | IT Products | ISRE | ReconcilingItems | Total | ||||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| BFSI | Health BU | CBU | ENU | TECH | MFG | COMM | Total | |||||||||||||||||||||
| Revenue | ₹ | 45,395 | ₹ | 18,871 | ₹ | 22,366 | ₹ | 18,432 | ₹ | 18,660 | ₹ | 11,336 | ₹ | 8,454 | ₹ | 143,514 | ₹ | 2,409 | ₹ | 2,143 | ₹ | (47 | ) | ₹ | 148,019 | |||
| Other operating income | — | — | — | — | — | — | — | **** | 699 | — | — | — | 699 | |||||||||||||||
| Segment Result | 9,335 | 2,929 | 3,506 | 2,196 | 3,526 | 2,092 | 1,518 | **** | 25,102 | (407 | ) | (636 | ) | (105 | ) | 23,954 | ||||||||||||
| Unallocated | **** | 720 | — | — | — | 720 | ||||||||||||||||||||||
| Segment Result Total | ₹ | 26,521 | ₹ | (407 | ) | ₹ | (636 | ) | ₹ | (105 | ) | ₹ | 25,373 | **** | ||||||||||||||
| Finance expense | (1,584 | ) | ||||||||||||||||||||||||||
| Finance and other income | 6,947 | |||||||||||||||||||||||||||
| Share of net profit /(loss) of associates accounted for using the equity method | (16 | ) | ||||||||||||||||||||||||||
| Profit before tax | ₹ | 30,720 | **** | |||||||||||||||||||||||||
| Income tax expense | (6,699 | ) | ||||||||||||||||||||||||||
| Profit for the period | ₹ | 24,021 | **** | |||||||||||||||||||||||||
| Depreciation, amortization and impairment | 4,955 |
Information on reportable segment for the three months ended June 30, 2020, is as follows:
| IT Services | IT Products | ISRE | ReconcilingItems | Total | |||||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| BFSI | Health BU | CBU | ENU | TECH | MFG | COMM | Total | ||||||||||||||||||||
| Revenue | ₹ | 44,828 | ₹ | 19,760 | ₹ | 23,179 | ₹ | 19,279 | ₹ | 19,670 | ₹ | 11,820 | ₹ | 7,420 | ₹ | 145,956 | ₹ | 2,258 | ₹ | 2,117 | ₹ | 5 | ₹ | 150,336 | |||
| Other operating income | — | — | — | — | — | — | — | **** | 97 | — | — | — | 97 | ||||||||||||||
| Segment Result | 8,517 | 2,728 | 4,419 | 3,569 | 4,167 | 2,228 | 891 | **** | 26,519 | 124 | (100 | ) | (908 | ) | 25,635 | ||||||||||||
| Unallocated | **** | 1,206 | — | — | — | 1,206 | |||||||||||||||||||||
| Segment Result Total | ₹ | 27,822 | ₹ | 124 | ₹ | (100 | ) | ₹ | (908 | ) | ₹ | 26,938 | **** | ||||||||||||||
| Finance expense | (1,299 | ) | |||||||||||||||||||||||||
| Finance and other income | 5,281 | ||||||||||||||||||||||||||
| Share of net profit /(loss) of associates accounted for using the equity method | 31 | ||||||||||||||||||||||||||
| Profit before tax | ₹ | 30,951 | **** | ||||||||||||||||||||||||
| Income tax expense | (6,838 | ) | |||||||||||||||||||||||||
| Profit for the period | ₹ | 24,113 | **** | ||||||||||||||||||||||||
| Depreciation, amortization and impairment | 6,154 |
23
The Company has four geographic segments: India, Americas, Europe and Rest of the world. Revenues from the geographic segments based on domicile of the customer are as follows:
| Three months ended June 30, | ||||
|---|---|---|---|---|
| 2019 | 2020 | |||
| India | ₹ | 7,341 | ₹ | 7,160 |
| Americas * | 84,652 | 86,219 | ||
| Europe | 35,577 | 35,160 | ||
| Rest of the world | 20,449 | 21,797 | ||
| ₹ | 148,019 | ₹ | 150,336 | |
| * | Substantially related to operations in the United States of America. | |||
| --- | --- |
No customer individually accounted for more than 10% of the revenues during the three months ended June 30, 2019 and 2020.
Management believes that it is currently not practicable to provide disclosure of geographical location wise assets, since the meaningful segregation of the available information is onerous.
Notes:
| a) | “Reconciling items” includes elimination of inter-segment transactions and other corporate<br>activities. | ||
|---|---|---|---|
| b) | During the three months ended June 30, 2020, the Company has contributed ₹ 991 towards COVID-19 and is reported in Reconciling items. | ||
| --- | --- | ||
| c) | Revenue from sale of traded cloud-based licenses is reported as part of IT Services revenues.<br> | ||
| --- | --- | ||
| d) | Revenue from sale of company owned intellectual properties is reported as part of IT Services revenues<br> | ||
| --- | --- | ||
| e) | For the purpose of segment reporting, the Company has included the impact of “foreign exchange gains /<br>(losses), net” in revenues (which is reported as a part of operating profit in the interim condensed consolidated statement of income). | ||
| --- | --- | ||
| f) | For evaluating performance of the individual operating segments, stock compensation expense is allocated on the<br>basis of straight-line amortization. The differential impact of accelerated amortization of stock compensation expense over stock compensation expense allocated to the individual operating segments is reported in Reconciling items.<br> | ||
| --- | --- | ||
| g) | The Company generally offers multi-year payment terms in certain total outsourcing contracts. These payment<br>terms primarily relate to IT hardware, software and certain transformation services in outsourcing contracts. The finance income on deferred consideration earned under these contracts is included in the revenue of the respective segment and is<br>eliminated under Reconciling items. | ||
| --- | --- | ||
| h) | Other operating income of<br>₹ 699 and ₹ 97 is included as a part of IT Services segment results for the<br>three months ended June 30, 2019 and 2020, respectively. Refer to Note 25. | ||
| --- | --- | ||
| i) | Segment results of IT Services segment are after recognition of share-based compensation expense of ₹ 427, and ₹ 401, for the three months ended June 30, 2019 and 2020,<br>respectively. The share-based compensation expense pertaining to other segments is not material. | ||
| --- | --- | ||
| 28. | List of subsidiaries and investments accounted for using equity method as at June 30, 2020 is providedbelow: | ||
| --- | --- | ||
| Subsidiaries | Subsidiaries | Subsidiaries | CountryofIncorporation |
| --- | --- | --- | --- |
| Wipro, LLC | USA | ||
| Wipro Gallagher Solutions, LLC | USA | ||
| Opus Capital Markets Consultants, LLC | USA | ||
| Wipro Promax Analytics Solutions Americas, LLC | USA | ||
| Wipro Insurance Solutions, LLC | USA | ||
| Wipro IT Services, LLC | USA | ||
| HealthPlan Services, Inc. ** | USA | ||
| Appirio, Inc. ** | USA | ||
| Cooper Software, Inc. | USA | ||
| Infocrossing, LLC | USA | ||
| Wipro US Foundation | USA | ||
| International TechneGroup Incorporated ** | USA | ||
| Rational Interaction, Inc. ** | USA | ||
| Wipro Overseas IT Services Pvt. Ltd | India | ||
| Wipro Japan KK | Japan | ||
| Wipro Shanghai Limited | China | ||
| Wipro Trademarks Holding Limited | India | ||
| Wipro Travel Services Limited | India | ||
| Wipro Holdings (UK) Limited | U.K. | ||
| Designit A/S | Denmark |
24
| Designit Denmark A/S | Denmark | ||
|---|---|---|---|
| Designit Germany GmbH | Germany | ||
| Designit Oslo A/S | Norway | ||
| Designit Sweden AB | Sweden | ||
| Designit T.L.V Ltd. | Israel | ||
| Designit Tokyo Ltd. | Japan | ||
| Designit Spain Digital, S.L. ** | Spain | ||
| Wipro Europe Limited | U.K. | ||
| Wipro UK Limited | U.K. | ||
| Wipro Financial Services UK Limited | U.K. | ||
| Wipro IT Services S.R.L. | Romania | ||
| Wipro IT Services SE (formerly Wipro Cyprus SE) | U.K. | ||
| Wipro Doha LLC # | Qatar | ||
| Wipro Technologies SA DE CV | Mexico | ||
| Wipro Philippines, Inc. | Philippines | ||
| Wipro Holdings Hungary Korlátolt Felelosségu Társaság | Hungary | ||
| Wipro Holdings Investment Korlátolt Felelosségu Társaság | Hungary | ||
| Wipro Information Technology Egypt SAE | Egypt | ||
| Wipro Arabia Co. Limited * | Saudi Arabia | ||
| Women’s Business Park Technologies Limited * | Saudi Arabia | ||
| Wipro Poland SP Z.O.O | Poland | ||
| Wipro IT Services Poland SP Z.O.O | Poland | ||
| Wipro Technologies Australia Pty Ltd | Australia | ||
| Wipro Corporate Technologies Ghana Limited | Ghana | ||
| Wipro Technologies South Africa (Proprietary) Limited | South Africa | ||
| Wipro Technologies Nigeria Limited | Nigeria | ||
| Wipro IT Service Ukraine, LLC | Ukraine | ||
| Wipro Information Technology Netherlands BV. | Netherlands | ||
| Wipro Portugal S.A. ** | Portugal | ||
| Wipro Technologies Limited | Russia | ||
| Wipro Technology Chile SPA | Chile | ||
| Wipro Solutions Canada Limited | Canada | ||
| Wipro Information Technology Kazakhstan LLP | Kazakhstan | ||
| Wipro Technologies W.T. Sociedad Anonima | Costa Rica | ||
| Wipro Outsourcing Services (Ireland) Limited | Ireland | ||
| Wipro Technologies VZ, C.A. | Venezuela | ||
| Wipro Technologies Peru S.A.C. | Peru | ||
| Wipro do Brasil Servicos de Tecnologia S.A. | Brazil | ||
| Wipro do Brasil Technologia Ltda ** | Brazil | ||
| Wipro Technologies SA | Argentina | ||
| Wipro Technologies S.R.L. | Romania | ||
| PT. WT Indonesia | Indonesia | ||
| Wipro (Thailand) Co. Limited | Thailand | ||
| Wipro Bahrain Limited Co. S.P.C. | Bahrain | ||
| Wipro Gulf LLC | Sultanate of Oman | ||
| Rainbow Software LLC | Iraq |
25
| Wipro Networks Pte Limited | Singapore | |
|---|---|---|
| Wipro (Dalian) Limited | China | |
| Wipro Technologies SDN BHD | Malaysia | |
| Wipro Chengdu Limited | China | |
| Wipro IT Services Bangladesh Limited | Bangladesh | |
| Wipro HR Services India Private Limited | India | |
| * | All the above direct subsidiaries are 100% held by the Company except that the Company holds 66.67% of the<br>equity securities of Wipro Arabia Co. Limited and 55% of the equity securities of Women’s Business Park Technologies Limited are held by Wipro Arabia Co. Limited. | |
| --- | --- |
51% of equity securities of Wipro Doha LLC are held by a local shareholder. However, the beneficial interest in these holdings is with the
Company.
The Company controls ‘The Wipro SA Broad Based Ownership Scheme Trust’, ‘Wipro SA Broad Based Ownership Scheme SPV (RF) (PTY) LTD incorporated in South Africa and Wipro Foundation in India
| ** | Step Subsidiary details of Wipro Portugal S.A, Wipro do Brasil Technologia Ltda, Designit Spain Digital, S.L,<br>HealthPlan Services, Inc, Appirio, Inc, International TechneGroup Incorporated and Rational Interaction, Inc. are as follows: | ||
|---|---|---|---|
| Subsidiaries | Subsidiaries | Subsidiaries | CountryofIncorporation |
| --- | --- | --- | --- |
| Wipro Portugal S.A. | Portugal | ||
| Wipro Technologies GmbH | Germany | ||
| Cellent GmbH | Germany | ||
| Cellent GmbH | Austria | ||
| Wipro do Brasil Technologia Ltda | Brazil | ||
| Wipro Do Brasil Sistemetas De Informatica Ltd | Brazil | ||
| Designit Spain Digital, S.L. | Spain | ||
| Designit Colombia S A S | Colombia | ||
| Designit Peru SAC | Peru | ||
| HealthPlan Services, Inc. | USA | ||
| HealthPlan Services Insurance Agency, LLC | USA | ||
| International TechneGroup Incorporated | USA | ||
| International TechneGroup Ltd. | U.K. | ||
| ITI Proficiency Ltd | Israel | ||
| International TechneGroup S.R.L. | Italy | ||
| MechWorks S.R.L. | Italy | ||
| Appirio, Inc. | USA | ||
| Appirio, K.K | Japan | ||
| Topcoder, LLC. | USA | ||
| Appirio Ltd | Ireland | ||
| Appirio Ltd (UK) | U.K. | ||
| Rational Interaction, Inc. | USA | ||
| Rational Consulting Australia Pty Ltd | Australia | ||
| Rational Interaction Limited | Ireland |
As at June 30, 2020 the Company held 43.7% interest in Drivestream Inc, 33% interest in Denim Group Limited and 33.3% in Denim Group Management, LLC, accounted for using the equity method.
The list of controlled trusts are:
| Name of the entity | Country of incorporation |
|---|---|
| Wipro Equity Reward Trust | India |
| Wipro Foundation | India |
26
| 29. | Bank balance |
|---|
Balances with banks in current and deposit account are as follows:
| As at June 30, 2020 | ||||||
|---|---|---|---|---|---|---|
| In Current Account | In Deposit Account | Total | ||||
| HDFC Bank | ₹ | 765 | ₹ | 36,308 | ₹ | 37,073 |
| ICICI Bank | — | 35,396 | 35,396 | |||
| Axis Bank | 53 | 23,930 | 23,983 | |||
| HSBC | 18,775 | 4,472 | 23,247 | |||
| Citi Bank | 13,549 | 8,538 | 22,087 | |||
| Wells Fargo Bank | 4,812 | — | 4,812 | |||
| BNP Paribas | 127 | 4,137 | 4,264 | |||
| Saudi British Bank | 2,286 | 201 | 2,487 | |||
| ANZ Bank | 339 | 2,060 | 2,399 | |||
| Kotak Mahindra Bank | 1 | 500 | 501 | |||
| Standard Chartered Bank | 374 | — | 374 | |||
| Unicredit Bank of Austria | 352 | — | 352 | |||
| JP Morgan Chase | 174 | 170 | 344 | |||
| Deutsche Bank | 332 | — | 332 | |||
| Silicon Valley Bank | 283 | — | 283 | |||
| United Amara Bank Limited | 260 | — | 260 | |||
| Bank of Tokyo | 162 | — | 162 | |||
| Rabo Bank | 135 | — | 135 | |||
| Intesa San Paolo | 117 | — | 117 | |||
| Bank of America | 108 | — | 108 | |||
| Others | 727 | — | 727 | |||
| Total | ₹ | 43,731 | ₹ | 115,712 | ₹ | 159,443 |
30. On July 13, 2020, the Company entered into a definitive agreement to acquire IVIA Serviços de Informática Ltda., a specialized IT services provider to financial services, retail and manufacturing sectors in Brazil, for a consideration of BRL 120 million (USD 22.4 million). The acquisition is subject to customary closing conditions and is expected to close in the quarter ending September 30, 2020.
| The accompanying notes form an integral part of these interim condensed consolidated financial statements | |||
|---|---|---|---|
| As per our report of even date attached | For and on behalf of the Board of Directors | ||
| for Deloitte Haskins & Sells LLP | Rishad A. Premji | M. K. Sharma | Thierry Delaporte |
| Chartered Accountants | Chairman | Director | Chief Executive Officer & |
| Firm Registration No: 117366W/W - 100018 | Managing Director | ||
| Vikas Bagaria | Jatin Pravinchandra Dalal | M. Sanaulla Khan | |
| Partner | Chief Financial Officer | Company Secretary | |
| Membership No. 60408 | |||
| Bengaluru | |||
| July 14, 2020 |
27
EX-99.5
Exhibit 99.5
WIPRO LIMITED
CIN:L32102KA1945PLC020800 ; Registered Office : Wipro Limited, Doddakanneli, Sarjapur Road, Bengaluru - 560035, India
Website:www.wipro.com ; Email id – info@wipro.com ; Tel: +91-80-2844 0011 ; Fax: +91-80-28440054
STATUTORILY AUDITED CONSOLIDATED FINANCIAL RESULTS FOR THE THREE MONTHS
ENDED JUNE 30, 2020
UNDER IFRS (IASB)
(₹ in millions,except share and per share data, unless otherwise stated)
| Year ended | |||||||||
|---|---|---|---|---|---|---|---|---|---|
| Particulars | March 31,<br><br><br>2020 | June 30,<br><br><br>2019 | March 31,<br><br><br>2020 | ||||||
| Income from operations | |||||||||
| a) Revenue | 149,131 | 157,110 | 147,161 | 610,232 | |||||
| b) Other operating income | 97 | 395 | 699 | 1,144 | |||||
| c) Foreign exchange gains/(losses), net | 1,205 | 993 | 858 | 3,169 | |||||
| I | Total income from operations | 150,433 | **** | 158,498 | **** | 148,718 | **** | **** | 614,545 |
| Expenses | |||||||||
| a) Purchase of<br>stock-in-trade | 1,766 | 2,937 | 2,984 | 9,360 | |||||
| b) (Increase)/Decrease in inventories of finished goods and stock-in-trade | 176 | 208 | (233 | ) | 2,022 | ||||
| c) Employee benefit expense | 80,262 | 85,448 | 77,476 | 326,571 | |||||
| d) Depreciation, amortization and impairment | 6,154 | 5,798 | 4,955 | 20,862 | |||||
| e) Sub-contracting/ technical fees | 21,218 | 22,771 | 22,563 | 90,521 | |||||
| f) Facility expenses | 4,627 | 5,071 | 4,733 | 19,733 | |||||
| g) Travel | 1,290 | 4,031 | 4,633 | 18,169 | |||||
| h) Communication | 1,354 | 1,317 | 1,136 | 4,812 | |||||
| i) Legal and professional fees | 1,311 | 1,256 | 1,096 | 4,733 | |||||
| j) Marketing and brand building | 129 | 579 | 772 | 2,532 | |||||
| k) Lifetime expected credit loss | 1,589 | 394 | 531 | 1,043 | |||||
| l) Other expenses | 3,619 | 2,299 | 2,699 | 8,457 | |||||
| II | Total expenses | 123,495 | **** | 132,109 | **** | 123,345 | **** | **** | 508,815 |
| III | Finance expenses | 1,299 | 1,653 | 1,584 | 7,328 | ||||
| IV | Finance and Other Income | 5,281 | 4,907 | 6,947 | 24,081 | ||||
| V | Share of net profit/(loss) of associates accounted for using the equity method | 31 | 13 | (16 | ) | 29 | |||
| VI | Profit before tax<br>[I-II-III+IV+V] | 30,951 | **** | 29,656 | **** | 30,720 | **** | **** | 122,512 |
| VII | Tax expense | 6,838 | 6,205 | 6,699 | 24,799 | ||||
| VIII | Net profit for the period [VI-VII] | 24,113 | **** | 23,451 | **** | 24,021 | **** | **** | 97,713 |
| IX | Total Other comprehensive income | 4,989 | 1,724 | 1,290 | 4,613 | ||||
| Total comprehensive income for the period [VIII+IX] | 29,102 | **** | 25,175 | **** | 25,311 | **** | **** | 102,326 | |
| X | Profit for the period attributable to: | ||||||||
| Equity holders of the Company | 23,902 | 23,260 | 23,874 | 97,218 | |||||
| Non-controlling Interest | 211 | 191 | 147 | 495 | |||||
| 24,113 | **** | 23,451 | **** | 24,021 | **** | **** | 97,713 | ||
| Total comprehensive income for the period attributable to: | |||||||||
| Equity holders of the Company | 28,955 | 24,880 | 25,178 | 101,673 | |||||
| Non-controlling Interest | 147 | 295 | 133 | 653 | |||||
| 29,102 | **** | 25,175 | **** | 25,311 | **** | **** | 102,326 | ||
| XI | Paid up equity share capital (Face value 2 per share) | 11,429 | 11,427 | 12,071 | 11,427 | ||||
| XII | Reserves excluding revaluation reserves and<br>Non-controlling Interest as per balance sheet | 546,031 | |||||||
| XIII | Earnings per share (EPS) | ||||||||
| (Equity shares of par value of<br> 2/- each) |
All values are in Indian Rupees.
1
| (EPS for the three months ended is not annualized) | ||||
|---|---|---|---|---|
| Basic (in<br>₹) | 4.20 | 4.09 | 3.97 | 16.67 |
| Diluted (in<br>₹) | 4.19 | 4.07 | 3.96 | 16.62 |
| 1. | The audited consolidated financial results of the Company for the three months ended June 30, 2020 have<br>been approved by the Board of Directors of the Company at its meeting held on July 14, 2020. The Company confirms that its statutory auditors, Deloitte Haskins & Sells LLP have issued an audit report with unmodified opinion on the<br>consolidated financial results. | |||
| --- | --- | |||
| 2. | The above consolidated financial results have been prepared from the interim condensed consolidated financial<br>statements, which are prepared in accordance with International Financial Reporting Standards and its interpretations (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). | |||
| --- | --- | |||
| 3. | Estimation uncertainty relating to the global health pandemic onCOVID-19 | |||
| --- | --- |
In assessing the recoverability of receivables including unbilled receivables, contract assets and contract costs, goodwill, intangible assets, and certain investments, the Company has considered internal and external information up to the date of approval of these consolidated financial results including credit reports and economic forecasts. The Company has performed sensitivity analysis on the assumptions used herein. Based on the current indicators of future economic conditions, the Company expects to recover the carrying amount of these assets.
The Company basis its assessment believes that the probability of the occurrence of forecasted transactions is not impacted by COVID-19. The Company has also considered the effect of changes, if any, in both counterparty credit risk and own credit risk while assessing hedge effectiveness and measuring hedge ineffectiveness and continues to believe that there is no impact on effectiveness of its hedges.
The impact of COVID-19 remains uncertain and may be different from what we have estimated as of the date of approval of these consolidated financial results and the Company will continue to closely monitor any material changes to future economic conditions.
| 4. | List of subsidiaries and investments accounted for using equity method as at June 30, 2020 are providedin the table below: | ||
|---|---|---|---|
| Subsidiaries | Subsidiaries | Subsidiaries | Country ofIncorporation |
| --- | --- | --- | --- |
| Wipro, LLC | USA | ||
| Wipro Gallagher Solutions, LLC | USA | ||
| Opus Capital Markets Consultants, LLC | USA | ||
| Wipro Promax Analytics Solutions Americas, LLC | USA | ||
| Wipro Insurance Solutions, LLC | USA | ||
| Wipro IT Services, LLC | USA | ||
| HealthPlan Services, Inc. ** | USA | ||
| Appirio, Inc. ** | USA | ||
| Cooper Software, Inc. | USA | ||
| Infocrossing, LLC | USA | ||
| Wipro US Foundation | USA | ||
| International TechneGroup Incorporated ** | USA | ||
| Rational Interaction, Inc. ** | USA | ||
| Wipro Overseas IT Services Pvt. Ltd | India | ||
| Wipro Japan KK | Japan | ||
| Wipro Shanghai Limited | China | ||
| Wipro Trademarks Holding Limited | India | ||
| Wipro Travel Services Limited | India | ||
| Wipro Holdings (UK) Limited | U.K. | ||
| Designit A/S | Denmark | ||
| Designit Denmark A/S | Denmark | ||
| Designit Germany GmbH | Germany | ||
| Designit Oslo A/S | Norway | ||
| Designit Sweden AB | Sweden | ||
| Designit T.L.V Ltd. | Israel | ||
| Designit Tokyo Ltd. | Japan | ||
| Designit Spain Digital, S.L. ** | Spain |
2
| Subsidiaries | Subsidiaries | Subsidiaries | Country ofIncorporation |
|---|---|---|---|
| Wipro Europe Limited | U.K. | ||
| Wipro UK Limited | U.K. | ||
| Wipro Financial Services UK Limited | U.K. | ||
| Wipro IT Services S.R.L. | Romania | ||
| Wipro IT Services SE (formerly Wipro Cyprus SE) | U.K. | ||
| Wipro Doha LLC # | Qatar | ||
| Wipro Technologies SA DE CV | Mexico | ||
| Wipro Philippines, Inc. | Philippines | ||
| Wipro Holdings Hungary Korlátolt Felelosségu Társaság | Hungary | ||
| Wipro Holdings Investment Korlátolt Felelosségu Társaság | Hungary | ||
| Wipro Information Technology Egypt SAE | Egypt | ||
| Wipro Arabia Co. Limited * | Saudi Arabia | ||
| Women’s Business Park Technologies Limited * | Saudi Arabia | ||
| Wipro Poland SP Z.O.O | Poland | ||
| Wipro IT Services Poland SP Z.O.O | Poland | ||
| Wipro Technologies Australia Pty Ltd | Australia | ||
| Wipro Corporate Technologies Ghana Limited | Ghana | ||
| Wipro Technologies South Africa (Proprietary) Limited | South Africa | ||
| Wipro Technologies Nigeria Limited | Nigeria | ||
| Wipro IT Service Ukraine, LLC | Ukraine | ||
| Wipro Information Technology<br> <br>Netherlands<br>BV. | Netherlands | ||
| Wipro Portugal S.A. ** | Portugal | ||
| Wipro Technologies Limited | Russia | ||
| Wipro Technology Chile SPA | Chile | ||
| Wipro Solutions Canada Limited | Canada | ||
| Wipro Information Technology Kazakhstan<br><br><br>LLP | Kazakhstan | ||
| Wipro Technologies W.T. Sociedad Anonima | Costa Rica | ||
| Wipro Outsourcing Services (Ireland) Limited | Ireland | ||
| Wipro Technologies VZ, C.A. | Venezuela | ||
| Wipro Technologies Peru S.A.C. | Peru | ||
| Wipro do Brasil Servicos de Tecnologia S.A. | Brazil | ||
| Wipro do Brasil Technologia Ltda ** | Brazil | ||
| Wipro Technologies SA | Argentina | ||
| Wipro Technologies S.R.L. | Romania | ||
| PT. WT Indonesia | Indonesia | ||
| Wipro (Thailand) Co. Limited | Thailand | ||
| Wipro Bahrain Limited Co. S.P.C. | Bahrain | ||
| Wipro Gulf LLC | Sultanate of Oman | ||
| Rainbow Software LLC | Iraq | ||
| Wipro Networks Pte Limited | Singapore | ||
| Wipro (Dalian) Limited | China | ||
| Wipro Technologies SDN BHD | Malaysia | ||
| Wipro Chengdu Limited | China | ||
| Wipro IT Services Bangladesh Limited | Bangladesh | ||
| Wipro HR Services India Private Limited | India |
3
| * | All the above direct subsidiaries are 100% held by the Company except that the Company holds 66.67% of the<br>equity securities of Wipro Arabia Co. Limited and 55% of the equity securities of Women’s Business Park Technologies Limited are held by Wipro Arabia Co. Limited. |
|---|---|
| # | 51% of equity securities of Wipro Doha LLC are held by a local shareholder. However, the beneficial interest in<br>these holdings is with the Company. |
| --- | --- |
The Company controls ‘The Wipro SA Broad Based Ownership Scheme Trust’, ‘Wipro SA Broad Based Ownership Scheme SPV (RF) (PTY) LTD incorporated in South Africa and Wipro Foundation in India
| ** | Step Subsidiary details of Wipro Portugal S.A, Wipro do Brasil Technologia Ltda, Designit Spain Digital, S.L,<br>HealthPlan Services, Inc, Appirio, Inc, International TechneGroup Incorporated and Rational Interaction, Inc. are as follows: | ||
|---|---|---|---|
| Subsidiaries | Subsidiaries | Subsidiaries | Country ofIncorporation |
| --- | --- | --- | --- |
| Wipro Portugal S.A. | Portugal | ||
| Wipro Technologies GmbH | Germany | ||
| Cellent GmbH | Germany | ||
| Cellent GmbH | Austria | ||
| Wipro do Brasil Technologia Ltda | Brazil | ||
| Wipro Do Brasil Sistemetas<br> <br>De Informatica<br>Ltd | Brazil | ||
| Designit Spain Digital, S.L. | Spain | ||
| Designit Colombia S A S | Colombia | ||
| Designit Peru SAC | Peru | ||
| HealthPlan Services, Inc. | USA | ||
| HealthPlan Services Insurance Agency, LLC | USA | ||
| International TechneGroup Incorporated | USA | ||
| International TechneGroup Ltd. | U.K. | ||
| ITI Proficiency Ltd | Israel | ||
| International TechneGroup S.R.L. | Italy | ||
| MechWorks S.R.L. | Italy | ||
| Appirio, Inc. | USA | ||
| Appirio, K.K | Japan | ||
| Topcoder, LLC. | USA | ||
| Appirio Ltd | Ireland | ||
| Appirio Ltd (UK) | U.K. | ||
| Rational Interaction, Inc. | USA | ||
| Rational Consulting Australia Pty Ltd | Australia | ||
| Rational Interaction Limited | Ireland |
As at June 30, 2020 the Company held 43.7% interest in Drivestream Inc, 33% interest in Denim Group Limited and 33.3% in Denim Group Management, LLC, accounted for using the equity method.
The list of controlled trusts are:
| Name of the entity | Country of incorporation |
|---|---|
| Wipro Equity Reward Trust | India |
| Wipro Foundation | India |
| 5. | Segment Information |
| --- | --- |
The Company is organized into the following operating segments: IT Services, IT Products and India State Run Enterprise segment (“ISRE”).
IT Services: The IT Services segment primarily consists of IT Service offerings to customers organized by industry verticals. The industry verticals are as follows: Banking, Financial Services and Insurance (“BFSI”), Health Business unit (“Health BU”), Consumer Business unit (“CBU”), Energy, Natural Resources & Utilities (“ENU”), Manufacturing (“MFG”), Technology (“TECH”) and Communications (“COMM”). Key service offerings to customers includes software application development and maintenance, research and development services for hardware and software design, business application services, analytics, consulting, infrastructure outsourcing services and business process services.
4
IT Products: The Company is a value-added reseller of desktops, servers, notebooks, storage products, networking solutions and packaged software for leading international brands. In certain total outsourcing contracts of the IT Services segment, the Company delivers hardware, software products and other related deliverables. Revenue relating to the above items is reported as revenue from the sale of IT Products.
ISRE: This segment consists of IT Services offerings to entities or departments owned or controlled by Government of India and/ or any State Governments.
The Chairman of the Company has been identified as the Chief Operating Decision Maker (“CODM”) as defined by IFRS 8, “Operating Segments.” The Chairman of the Company evaluates the segments based on their revenue growth and operating income.
Assets and liabilities used in the Company’s business are not identified to any of the operating segments, as these are used interchangeably between segments. Management believes that it is currently not practicable to provide segment disclosures relating to total assets and liabilities since a meaningful segregation of the available data is onerous.
Information on reportable segments for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, and year ended March 31, 2020 are as follows:
| Particulars | Three months ended | Yearended | ||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| June 30,<br>2020 | March 31,<br>2020 | June 30,<br>2019 | March 31,<br>2020 | |||||||||
| Audited | Audited | Audited | Audited | |||||||||
| Revenue | ||||||||||||
| IT Services | ||||||||||||
| BFSI | 44,828 | 46,690 | 45,395 | 184,457 | ||||||||
| Health BU | 19,760 | 20,589 | 18,871 | 78,240 | ||||||||
| CBU | 23,179 | 25,669 | 22,366 | 97,008 | ||||||||
| ENU | 19,279 | 19,570 | 18,432 | 76,443 | ||||||||
| TECH | 19,670 | 19,503 | 18,660 | 75,895 | ||||||||
| MFG | 11,820 | 12,486 | 11,336 | 48,158 | ||||||||
| COMM | 7,420 | 8,453 | 8,454 | 33,840 | ||||||||
| Total of IT Services | **** | 145,956 | **** | **** | 152,960 | **** | **** | 143,514 | **** | **** | 594,041 | **** |
| IT Products | 2,258 | 2,792 | 2,409 | 11,010 | ||||||||
| ISRE | 2,117 | 2,341 | 2,143 | 8,400 | ||||||||
| Reconciling Items | 5 | 10 | (47 | ) | (50 | ) | ||||||
| Total Revenue | **** | 150,336 | **** | **** | 158,103 | **** | **** | 148,019 | **** | **** | 613,401 | **** |
| Other operating Income | ||||||||||||
| IT Services | 97 | 395 | 699 | 1,144 | ||||||||
| Total Other Operating Income | **** | 97 | **** | **** | 395 | **** | **** | 699 | **** | **** | 1,144 | **** |
| Segment Result | ||||||||||||
| IT Services | ||||||||||||
| BFSI | 8,517 | 8,144 | 9,335 | 34,132 | ||||||||
| Health BU | 2,728 | 3,049 | 2,929 | 12,027 | ||||||||
| CBU | 4,419 | 4,546 | 3,506 | 16,729 | ||||||||
| ENU | 3,569 | 3,766 | 2,196 | 12,176 | ||||||||
| TECH | 4,167 | 3,906 | 3,526 | 14,312 | ||||||||
| MFG | 2,228 | 2,336 | 2,092 | 9,252 | ||||||||
| COMM | 891 | 1,330 | 1,518 | 5,336 | ||||||||
| Unallocated | 1,206 | (547 | ) | 720 | 2,577 | |||||||
| Other Operating Income | 97 | 395 | 699 | 1,144 | ||||||||
| Total of IT Services | **** | 27,822 | **** | **** | 26,925 | **** | **** | 26,521 | **** | **** | 107,685 | **** |
| IT Products | 124 | 116 | (407 | ) | (282 | ) | ||||||
| ISRE | (100 | ) | (481 | ) | (636 | ) | (1,822 | ) | ||||
| Reconciling Items | (908 | ) | (171 | ) | (105 | ) | 149 | |||||
| Total | **** | 26,938 | **** | **** | 26,389 | **** | **** | 25,373 | **** | **** | 105,730 | **** |
5
| Finance Expense | (1,299 | ) | (1,653 | ) | (1,584 | ) | (7,328 | ) |
|---|---|---|---|---|---|---|---|---|
| Finance and Other Income | 5,281 | 4,907 | 6,947 | 24,081 | ||||
| Share of net profit/ (loss) of associates accounted for using the equity method | 31 | 13 | (16 | ) | 29 | |||
| Profit before tax | 30,951 | **** | 29,656 | **** | 30,720 | **** | 122,512 | **** |
Notes:
| a) | “Reconciling items” includes elimination of inter-segment transactions and other corporate<br>activities. |
|---|---|
| b) | During the three months ended June 30, 2020, the Company has contributed ₹ 991 towards COVID-19 and is reported in Reconciling items. |
| --- | --- |
| c) | Revenue from sale of traded cloud-based licenses is reported as part of IT Services revenues.<br> |
| --- | --- |
| d) | Revenue from sale of company owned intellectual properties is reported as part of IT Services revenues<br> |
| --- | --- |
| e) | For the purpose of segment reporting, the Company has included the impact of “foreign exchange gains /<br>(losses), net” in revenues amounting to ₹ 1,205, ₹ 993 and ₹ 858 for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, respectively, and ₹ 3,169 for the year ended March 31, 2020, which is reported as a part of operating profit in the interim condensed consolidated statement of income. |
| --- | --- |
| f) | For evaluating performance of the individual operating segments, stock compensation expense is allocated on the<br>basis of straight-line amortization. The differential impact of accelerated amortization of stock compensation expense over stock compensation expense allocated to the individual operating segments is reported in Reconciling items.<br> |
| --- | --- |
| g) | The Company generally offers multi-year payment terms in certain total outsourcing contracts. These payment<br>terms primarily relate to IT hardware, software and certain transformation services in outsourcing contracts. The finance income on deferred consideration earned under these contracts is included in the revenue of the respective segment and is<br>eliminated under Reconciling items. |
| --- | --- |
| h) | Other operating income of<br>₹ 97, ₹ 395, and ₹ 699 is included as a part of IT Services segment results for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, respectively, and ₹ 1,144 for the year ended March 31, 2020. Refer to Note 6 |
| --- | --- |
| i) | Segment results of IT Services segment are after recognition of share-based compensation expense of ₹ 401, ₹ 383, and<br>₹ 427, for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, respectively, and ₹ 1,229 for the year ended March 31, 2020. The share-based compensation expense pertaining to other segments is not material. |
| --- | --- |
| 6. | Other operating income |
| --- | --- |
The Company has partially met the first and second-year business targets pertaining to sale of hosted data center business concluded during the year ended March 31, 2019. Change in fair value of the callable units pertaining to achievement of the business targets amounting to ₹ 97, ₹ 395, and ₹ 597 for the three months ended June 30, 2020, March 31, 2020 and June 30, 2019, respectively, and ₹ 992 for the year ended March 31, 2020 has been recognized under other operating income.
The Company concluded the sale of assets pertaining to Workday business and Cornerstone OnDemand business in Portugal, France and Sweden during the year ended March 31, 2020. Gain arising from such transaction of ₹ 102 and ₹ 152 for the three months ended June 30, 2019 and year ended March 31, 2020, respectively has been recognized under other operating income.
| 7. | On July 13, 2020, the Company entered into a definitive agreement to acquire IVIA Serviços de<br>Informática Ltda., a specialized IT services provider to financial services, retail and manufacturing sectors in Brazil, for a consideration of BRL 120 million (USD 22.4 million). The acquisition is subject to customary closing<br>conditions and is expected to close in the quarter ending September 30, 2020. | ||
|---|---|---|---|
| By order of the Board, | For, Wipro Limited | ||
| --- | --- | --- | --- |
| Place: | Bengaluru | Rishad A. Premji | |
| Date: | July 14, 2020 | Chairman |
6
EX-99.6
Exhibit 99.6
Wipro Limited
Results for the Quarter ended June 30, 2020
Operating Metrics Pertaining to IT Services Segment
A. IT Services
| FY 19-20 | FY 18-19 | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| FY | Q4 | Q3 | Q2 | Q1 | FY | ||||||||||||||||
| Revenue &OM % | IT services Revenues (Mn) | 1,921.6 | **** | **** | 8,256.2 | **** | **** | 2,073.7 | **** | **** | 2,094.8 | **** | **** | 2,048.9 | **** | **** | 2,038.8 | **** | **** | 8,120.3 | **** |
| Sequential Growth Note 1 | -7.3 | % | **** | 2.5 | % | **** | -1.0 | % | **** | 2.2 | % | **** | 0.5 | % | **** | -1.3 | % | **** | 3.8 | % | |
| Sequential Growth in Constant<br>Currency Note 1&2 | -7.5 | % | **** | 3.9 | % | **** | 0.4 | % | **** | 1.8 | % | **** | 1.1 | % | **** | -0.7 | % | **** | 5.4 | % | |
| Operating Margin % Note 3 | 19.0 | % | **** | 18.1 | % | **** | 17.6 | % | **** | 18.4 | % | **** | 18.1 | % | **** | 18.4 | % | **** | 17.9 | % | |
| Service Line Mix | Practices | ||||||||||||||||||||
| Digital Operations and Platforms | 14.8 | % | **** | 14.8 | % | **** | 14.6 | % | **** | 15.3 | % | **** | 14.7 | % | **** | 14.7 | % | **** | 13.7 | % | |
| Cloud and Infrastructure Services | 25.9 | % | **** | 25.8 | % | **** | 25.8 | % | **** | 25.8 | % | **** | 25.7 | % | **** | 25.7 | % | **** | 25.5 | % | |
| Data, Analytics and AI | 7.2 | % | **** | 7.3 | % | **** | 7.2 | % | **** | 7.2 | % | **** | 7.3 | % | **** | 7.4 | % | **** | 7.2 | % | |
| Application Services | 44.4 | % | **** | 44.5 | % | **** | 44.7 | % | **** | 44.2 | % | **** | 44.8 | % | **** | 44.6 | % | **** | 45.9 | % | |
| Industrial & Engineering Services | 7.7 | % | **** | 7.6 | % | **** | 7.7 | % | **** | 7.5 | % | **** | 7.5 | % | **** | 7.6 | % | **** | 7.7 | % | |
| SBU Mix | Strategic Business Units | ||||||||||||||||||||
| Banking, Financial Services and Insurance | 30.7 | % | **** | 31.0 | % | **** | 30.4 | % | **** | 30.9 | % | **** | 31.3 | % | **** | 31.6 | % | **** | 30.9 | % | |
| Communications | 5.1 | % | **** | 5.7 | % | **** | 5.5 | % | **** | 5.7 | % | **** | 5.7 | % | **** | 5.9 | % | **** | 5.7 | % | |
| Consumer Business Unit | 15.9 | % | **** | 16.3 | % | **** | 16.8 | % | **** | 16.9 | % | **** | 16.0 | % | **** | 15.6 | % | **** | 15.7 | % | |
| Energy, Natural Resources and Utilities | 13.2 | % | **** | 12.9 | % | **** | 12.8 | % | **** | 12.9 | % | **** | 12.9 | % | **** | 12.8 | % | **** | 12.8 | % | |
| Health Business Unit | 13.5 | % | **** | 13.2 | % | **** | 13.5 | % | **** | 13.1 | % | **** | 13.0 | % | **** | 13.2 | % | **** | 13.2 | % | |
| Manufacturing | 8.1 | % | **** | 8.1 | % | **** | 8.2 | % | **** | 8.2 | % | **** | 8.1 | % | **** | 7.9 | % | **** | 8.2 | % | |
| Technology | 13.5 | % | **** | 12.8 | % | **** | 12.8 | % | **** | 12.3 | % | **** | 13.0 | % | **** | 13.0 | % | **** | 13.5 | % | |
| Geography Mix | Geography | ||||||||||||||||||||
| Americas | 59.0 | % | **** | 59.1 | % | **** | 59.1 | % | **** | 59.2 | % | **** | 59.6 | % | **** | 58.7 | % | **** | 56.8 | % | |
| Europe | 23.7 | % | **** | 24.0 | % | **** | 24.1 | % | **** | 23.7 | % | **** | 23.5 | % | **** | 24.6 | % | **** | 25.5 | % | |
| Rest of the World | 17.3 | % | **** | 16.9 | % | **** | 16.8 | % | **** | 17.1 | % | **** | 16.9 | % | **** | 16.7 | % | **** | 17.7 | % | |
| Customer Relationships | Customer size distribution (TTM) | ||||||||||||||||||||
| > 100MN | 13 | **** | **** | 15 | **** | **** | 15 | **** | **** | 14 | **** | **** | 13 | **** | **** | 13 | **** | **** | 10 | **** | |
| > 75MN | 22 | **** | **** | 22 | **** | **** | 22 | **** | **** | 22 | **** | **** | 23 | **** | **** | 23 | **** | **** | 22 | **** | |
| > 50MN | 39 | **** | **** | 40 | **** | **** | 40 | **** | **** | 41 | **** | **** | 41 | **** | **** | 41 | **** | **** | 41 | **** | |
| > 20MN | 97 | **** | **** | 96 | **** | **** | 96 | **** | **** | 96 | **** | **** | 92 | **** | **** | 92 | **** | **** | 96 | **** | |
| > 10MN | 163 | **** | **** | 166 | **** | **** | 166 | **** | **** | 169 | **** | **** | 165 | **** | **** | 166 | **** | **** | 172 | **** | |
| > 5MN | 258 | **** | **** | 260 | **** | **** | 260 | **** | **** | 260 | **** | **** | 261 | **** | **** | 259 | **** | **** | 262 | **** | |
| > 3MN | 348 | **** | **** | 341 | **** | **** | 341 | **** | **** | 344 | **** | **** | 341 | **** | **** | 340 | **** | **** | 339 | **** | |
| > 1MN | 577 | **** | **** | 574 | **** | **** | 574 | **** | **** | 572 | **** | **** | 569 | **** | **** | 564 | **** | **** | 571 | **** | |
| Customer Metrics | Revenue from Existing customers % | 99.7 | % | **** | 98.1 | % | **** | 97.0 | % | **** | 97.6 | % | **** | 98.4 | % | **** | 99.4 | % | **** | 98.4 | % |
| Number of new customers | 42 | **** | **** | 240 | **** | **** | 65 | **** | **** | 77 | **** | **** | 57 | **** | **** | 41 | **** | **** | 271 | **** | |
| Total Number of active customers | 1,004 | **** | **** | 1,074 | **** | **** | 1,074 | **** | **** | 1,070 | **** | **** | 1,027 | **** | **** | 1,060 | **** | **** | 1,115 | **** | |
| Customer Concentration | |||||||||||||||||||||
| Top customer | 3.2 | % | **** | 3.2 | % | **** | 3.0 | % | **** | 3.0 | % | **** | 3.2 | % | **** | 3.7 | % | **** | 3.7 | % | |
| Top 5 | 12.3 | % | **** | 12.8 | % | **** | 12.2 | % | **** | 12.3 | % | **** | 12.8 | % | **** | 13.8 | % | **** | 12.7 | % | |
| Top 10 | 20.3 | % | **** | 19.7 | % | **** | 19.3 | % | **** | 19.2 | % | **** | 19.8 | % | **** | 20.7 | % | **** | 19.5 | % |
All values are in US Dollars.
Notes:
Note 1: QoQand YoY growth rates have been adjusted for the impact of divestments
Note 2: Constant currency revenue for a period is the product of volumes inthat period times the average actual exchange rate of the corresponding comparative period
Note 3: IT Services Operating Margin refers to SegmentResults Total as reflected in IFRS financials
| FY 19-20 | FY 18-19 | ||||||||||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| FY | Q4 | Q3 | Q2 | Q1 | FY | ||||||||||||||||
| Currency Mix | % of Revenue | ||||||||||||||||||||
| 63 | % | **** | 63 | % | **** | 62 | % | **** | 63 | % | **** | 63 | % | **** | 62 | % | **** | 61 | % | ||
| 10 | % | **** | 10 | % | **** | 10 | % | **** | 10 | % | **** | 9 | % | **** | 10 | % | **** | 10 | % | ||
| 8 | % | **** | 8 | % | **** | 8 | % | **** | 8 | % | **** | 8 | % | **** | 9 | % | **** | 9 | % | ||
| 5 | % | **** | 4 | % | **** | 5 | % | **** | 4 | % | **** | 4 | % | **** | 4 | % | **** | 5 | % | ||
| AUD | 5 | % | **** | 5 | % | **** | 4 | % | **** | 4 | % | **** | 5 | % | **** | 5 | % | **** | 5 | % | |
| CAD | 2 | % | **** | 3 | % | **** | 3 | % | **** | 3 | % | **** | 3 | % | **** | 3 | % | **** | 3 | % | |
| Others | 7 | % | **** | 7 | % | **** | 8 | % | **** | 8 | % | **** | 8 | % | **** | 7 | % | **** | 7 | % | |
| Employee Metrics | Closing Employee Count | 181,804 | **** | **** | 182,886 | **** | **** | 182,886 | **** | **** | 187,318 | **** | **** | 181,453 | **** | **** | 174,850 | **** | **** | 171,425 | **** |
| Utilization<br>(IT Services excl. DOP, Designit, Cellent, Cooper, Infoserver, India, Rational and ITI) | |||||||||||||||||||||
| Gross Utilization | 75.0 | % | **** | 72.2 | % | **** | 73.4 | % | **** | 70.2 | % | **** | 71.4 | % | **** | 73.9 | % | **** | 74.4 | % | |
| Net Utilization (Excluding Support) | 84.5 | % | **** | 80.9 | % | **** | 82.4 | % | **** | 78.5 | % | **** | 79.9 | % | **** | 82.8 | % | **** | 83.3 | % | |
| Net Utilization (Excluding Trainees) | 84.5 | % | **** | 82.3 | % | **** | 82.6 | % | **** | 79.6 | % | **** | 82.1 | % | **** | 85.0 | % | **** | 84.8 | % | |
| Attrition | |||||||||||||||||||||
| (IT Services excl. DOP) | |||||||||||||||||||||
| Voluntary TTM | 13.0 | % | **** | 14.7 | % | **** | 14.7 | % | **** | 15.7 | % | **** | 17.0 | % | **** | 17.6 | % | **** | 17.6 | % | |
| Voluntary Quarterly Annualized | 10.7 | % | **** | 14.7 | % | **** | 12.6 | % | **** | 12.5 | % | **** | 16.0 | % | **** | 17.9 | % | **** | 17.6 | % | |
| DOP % - Quarterly | 4.5 | % | **** | 11.2 | % | **** | 11.8 | % | **** | 11.0 | % | **** | 11.0 | % | **** | 11.2 | % | **** | 11.7 | % | |
| DOP % - Post Training Quarterly | 4.4 | % | **** | 10.1 | % | **** | 10.8 | % | **** | 9.6 | % | **** | 9.9 | % | **** | 10.0 | % | **** | 10.5 | % | |
| Sales & Support Staff - IT Services | 14,567 | **** | **** | 14,908 | **** | **** | 14,908 | **** | **** | 15,232 | **** | **** | 14,990 | **** | **** | 14,116 | **** | **** | 14,360 | **** |
All values are in US Dollars.
B. IT Services (Excluding DOP, Designit, Cellent, Appirio, Cooper, Infoserver, India, Rational and ITI)
| Service delivery | Revenue from FPP | 61.7 | % | 62.4 | % | 63.2 | % | 62.6 | % | 61.9 | % | 61.6 | % | 59.4 | % |
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
| Onsite Revenue—% of Services | 51.5 | % | 52.9 | % | 51.8 | % | 53.2 | % | 53.3 | % | 52.3 | % | 52.3 | % | |
| Offshore Revenue—% of Services | 48.5 | % | 47.1 | % | 48.2 | % | 46.8 | % | 46.7 | % | 47.7 | % | 47.7 | % |
C. Growth Metrics for the Quarter ended June 30, 2020^Note 2^
| ReportedCurrencyQoQ% | ReportedCurrencyYoY % | ConstantCurrencyQoQ% | ConstantCurrencyYoY % | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|
| IT Services | **** | -7.3 | % | **** | -5.7 | % | **** | -7.5 | % | **** | -4.4 | % |
| Strategic Business Units | ||||||||||||
| Banking, Financial Services and Insurance | **** | -6.6 | % | **** | -8.7 | % | **** | -6.4 | % | **** | -6.9 | % |
| Communications | **** | -14.7 | % | **** | -18.6 | % | **** | -16.2 | % | **** | -16.9 | % |
| Consumer Business Unit | **** | -12.3 | % | **** | -3.7 | % | **** | -12.4 | % | **** | -2.5 | % |
| Energy, Natural Resources and Utilities | **** | -4.4 | % | **** | -3.0 | % | **** | -5.4 | % | **** | -1.7 | % |
| Health Business Unit | **** | -7.2 | % | **** | -2.9 | % | **** | -7.2 | % | **** | -2.1 | % |
| Manufacturing | **** | -8.0 | % | **** | -3.5 | % | **** | -8.1 | % | **** | -2.0 | % |
| Technology | **** | -2.0 | % | **** | -2.2 | % | **** | -2.1 | % | **** | -1.4 | % |
| Geography | ||||||||||||
| Americas | **** | -7.4 | % | **** | -5.3 | % | **** | -7.0 | % | **** | -4.4 | % |
| Europe | **** | -8.9 | % | **** | -9.1 | % | **** | -9.7 | % | **** | -7.7 | % |
| Rest of the World | **** | -4.7 | % | **** | -2.3 | % | **** | -6.1 | % | **** | 0.5 | % |
| Practices | ||||||||||||
| Digital Operations and Platforms | **** | -5.9 | % | **** | -5.0 | % | **** | -5.9 | % | **** | -4.6 | % |
| Cloud and Infrastructure Services | **** | -7.1 | % | **** | -5.0 | % | **** | -6.9 | % | **** | -3.1 | % |
| Data, Analytics and AI | **** | -7.5 | % | **** | -8.5 | % | **** | -7.8 | % | **** | -7.3 | % |
| Application Services | **** | -7.9 | % | **** | -6.2 | % | **** | -8.3 | % | **** | -4.8 | % |
| Industrial & Engineering Services | **** | -7.5 | % | **** | -4.3 | % | **** | -7.6 | % | **** | -3.5 | % |
D. Annexure to Datasheet
| Segment-wise breakup ofCost of Revenues, S&M andG&A | Q1 FY20-21 ( Mn) | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|
| Particulars | IT Services | IT Products | ISRE | Reconciling<br>Items | Total | |||||
| Cost of revenues | **** | 1,993 | **** | 2,032 | **** | (8 | ) | **** | 103,700 | |
| Selling and marketing expenses | **** | 29 | **** | 81 | **** | (4 | ) | **** | 9,789 | |
| General and administrative expenses | **** | 112 | **** | 104 | **** | 925 | **** | **** | 10,006 | |
| Total | **** | 2,134 | **** | 2,217 | **** | 913 | **** | **** | 123,495 |
All values are in Indian Rupees.