A Study on Financial Analysis of Wipro

Report submitted by

Venkata Satya Narayana Raju Vatshavayi

(AUD13944)

Amity University Dubai

Under the Guidance of

Dr. Ankita Rajdev
Contents :

1. Introduction
1.1. Financial Analysis
1.2. Introduction of Wipro
1.3. Wipro’s Timeline
1.4. Company Profile
1.5. Services provided by Wipro
1.6. Registered office address
1.7. Board of Directors

2. Literature Review

3. Conclusion
 1. Introduction

The Financial statement will deliver the relevant and

dependable realities internally and external clients
like traders, proprietor attributable to commercial
enterprise company, government, gifted chiefs,
leasers and so forth are the customers of those
element who are otherwise known as companions
of a distinctiveness unit.

The research of price range abstract will look at the

matters in Profit and Loss record and Balance sheet.
It will assist to all the customers of price range
reviews to take gripping desire.

1.1 .Financial Analysis :

Financial Analysis is that the process of identifying
the financial strengths and weakness of the
company. It is done by installing relationships
between the items of financial statements. Financial
 analysis can be undertaken by management of the
company , owners, Creditors, Investors and others.

Analysis of Financial Statements may be made for

particular purpose in view :
1) To seek out the financial stability and soundness
of the commercial enterprise.
2)To evaluate the earning capacity of the business
3)To estimate the fixed assets, stocks etc., of the
concern.
4)To determine the possibilities of future growth of
business.
5)To evaluate the firm’s capacity and ability to repay
short and long term loans.

Parties interested in financial analysis are divided

in to two broad groups
 Internal users

 External users

Internal users are Financial executives and top

management.
External users are Investors, customers, workers,
Government, public.

The time period Financial Analysis includes both

investigation and knowledges of operational
productiveness and coins associate situation of the
company. Different techniques and strategies are
applied to take a look at the connection between
numerous proclamations.

The exam additives of the Financial Analysis are :

 Liquidity : It is to estimate its quick dissolvability
Organizations.

 Long- term dissolvability : It illustrate the potential

to meet the long drag obligation of IT
corporations.

 Profitability : To investigate its after effects

company duties and through and big
implementation and skill ability of the companies.

The accompanying techniques are usually

implemented
  Income Research

 Cost volume gain

 Flat analysis

 Pattern exam

 Vertical analysis

 Proportion exam.

1.2.Introduction of company ( Wipro)

Wipro limited is a key global information technology,
consulting and business process services firm. It is a
firm recognized globally for its comprehensive
portfolio services and strong commitment to
sustainability and good corporate citizenship.

Wipro is a 3.5 $ billion global company in Information

Technology services (IT Services), R&D services,
Business Process Outsourcing (BPO). Team Wipro is
75,000 strong from 40+ nationalities and growing.
Wipro Is showed in across 29 countries, 36
development centers, investors across 24 countries.
 It is the largest third party R&D service provider in
the world
 It is the largest Indian technology
infrastructure management service provider
 It is a vendor of choice in the middle east
 It is among the top 3 Indian BPO service
provider by revenue
 It is among the top 2 domestic IT service
companies in India.

1.3.Wipro Timeline (1945 – 2021) :

Wipro was founded on 29th December, 1945 by

mohamed premji and it is headquartered in
Bangalore, India. In 1947 they started an oil mill
and hydrogenated cooking medium plant. In
1966, after the death of Mohamed Premji, his
son Azim Premji took over Wipro as its chairman at
the age of 21. The company’s first departure from
its main vegetable oil business came about in
1975 and also Wipro begins to manufacture
hydraulic cylinders. In 1979 under the direction
of P.S. Pai, Wipro’s consumer care division expanded
beyond oil and also during this year they
established operations in soaps and baby care
products. In 1980 Wipro launched IT Services for
domestic markets, setting up in Bangalore. In 1983
they established software products and exports
subsidiary, Wipro systems Ltd. In 1985 they
began manufacturing Pc’s and workstations.

During the year 1990, the company market

capitalization has jumped from 67M to 4.1B, making it
India’s third largest company and In 1998 Wipro
started exporting hydraulic cylinders throughout
Southeast Asia. By the end of March 2001, the
company’s Net Income hit a record of 138M up and
operating margins increased from 18% - 24%. In 2004
Wipro joined the Billion Dollar Club and during the year
2009 the company signed an agreement with
Delhi International Airports (DIA) Pvt Ltd and formed
joint venture company named Wipro Airport IT
Services Ltd. On 15th June 2017 Wipro announced that
it has achieved Amazon Web Services, AWS service
Delivery status from AWS service catalog and also
during this year the company expanded its operations
in London. In Feb, 2020 Wipro acquired Rational
interaction, a Seattle based digital customer
experience consultancy. In July 2020, the company
announced the launch of its 5G edge services solutions
built with IBM Software systems. In March 2021, Wipro
acquired Capco, a 22 year old British tech consultancy
firm and also in March, Wipro appoints Pierre Bruno as
CEO of European operations.

1.4.Comapny Profile :

 It was incorporated in 1945 at Amalner,

Maharashtra, India by Mohammed Premji and
 It started as an Edible Oil company and after few
years they changed the name into Western Indian
Palm Refined Oils Ltd.
 It transformed itself into a leading player in EMCG
Industry and
 Currently it is a global IT consultant and Business
Process Services provider
 It is ranked as 3rd fastest growing company in the
world
Brand Finance has studied the brand value of Wipro
brand 12 times between 2009 to 2021. The Wipro
brand valuation has featured in 26 brand rankings
 including the strong and most valuable IT service
brands and the biggest India brands and the best
global brands.

1.5.Services Provided by Wipro :

IT Services : Wipro takes charge of the IT needs

of the total enterprise and the services extended from
enterprise application services to E-Business Solutions.

Product Engineering Solutions and

Infrastructure Services : Wipro is the largest
independent provider of R&D services in the world
and Wipro’s Technology Infrastructure Services (TIS) is
the largest Indian Infrastructure service provider in
terms of revenue, people .

Business Process Outsourcing : Wipro BPO is

particularly positioned to service customer
requirements by influence its tenets of quality and
innovation. They also offers customized services,
translating into the most flexible and cost effective
services of the highest quality for customers.

Consulting Services : Wipro’s cross industry

consulting services helps in crafting visions for
organizations then provide a selected, practical
business and technology framework.

1.6.Registered Office Address :

Wipro Limited
Doddakannelli, Sarjapur Road,
Bangalore, Pin – 560035, India.
Tel : +91 8028440011
Fax: +91 80 2844054

1.7.Board of Directors
 Azim H . Premji - Chairman
 Dr Ashok S Ganguly - Former Chief Ex. Officer
 B.C. Prabhakar - Practitioner of Law
 N.Vagual - Chairman – ICICI Bank Ltd
  Bill Owens - Former Chief Ex. Officer
 P. M. Sinba - Former Chairman Pepsico
India Holdings.
Board Governance and Compensation
Committee :
 Ashok S Ganguly - Chairman
 N Vaghul - Member
 P M Sinha - Member

Audit Committee :
 N Vaghual - Chairman
 P M Sinha - Member
 B C Prabhakar - Member

Shareholders Grievance & Administrative

committee :
 B C Prabhakar - Chairman
 Azim H Premji - Member

2.Literature Review
 1. According to Elijah Adeyinka Adedeji (2014)
It is published on November 2014. In
Research Journal of Finance and Accounting Vol-5 ,
No-9.

They key importance of efficient of an organizations is

point up both by the ratio analysis and organizational
performance and by the financial ratio. In order to
reveal areas of weakness and strengths a financial ratio
should be equate regularly with some existing
standards as the ratio can’t convert useful information
on its own.

2. According to Bhunia A Mukhutl (2011).

It is identified that the understanding of financial

statements is a key to fundamental stock analysis and
overall investment research. Financial statements
provides an account of a company’s previous
performance and a figure of its current financial
strengths and a brief look in to the future potential of
a company. The aim is to increase an ability to make
a good judgement about the company’s financial
strength and future prospects by using financial
statements in investment research.

3. According to Thomson .R (2008)

He said that the financial analysis is the process of

identifying the strengths and weakness of the
company with the help of accounting information
provided in the Profit and Loss account and
Balance Sheet.

4. According to Anthony .R (2007)

Identified that the accounting as a means of

collecting, analyzing, summarizing and reporting in
budgetary terms, information about the business.
This sample definition highlights the key
importance of financial and accounting
information in the commercial enterprise and
there is a potential to the following accounting
principles and scope of the field of accounts and
finance.
 5. According to S. Saigeetha & Dr.S. Surulivelin (2017)

The accounting ratio is very useful to analyze a firm’s

financial status. Financial analysis helps to estimate a
company’s profitability and financial situation. The
analysis can be carried out through the annual
comparison of ratios and different users like corporate
management, bankers, investment companies and
creditors use accounting ratios to estimate a financial
situation to take key important decisions for their
business.

6. According to P.Srinivasan (2018)

He conducted a study to analyze financial performance
and position using ratio analysis. It includes analyzing
the Profit & Loss account and Balance Sheet for the
period of 5 years. The research says that firm’s
financial situation was not satisfactory and they should
take efforts to increase sales by reducing cost for
maximizing profits.

7. According to Gordon, M. Shilinglaw (2006)

The author illustrate the key importance of business
and financial reporting. He highlighted that the
economy depends on business organizations for goods
and services. The financial activities of corporate
enterprises of production and sale are of utmost
importance.

8. According to Wilson, P.R, Carpenter, J.H (2005)

He said that the financial statements assumes an

important place in modern management. Officers,
executives and directors of corporation should be able
to make an authentic examination of financial
statement of their business if they exist to plan
productively and wisely.

9. According to Reilly Brown (2004)

Reilly Brown identified that the major source of

information regarding a stock is the corporation
financial statement. Financial statement are intended
to give information on the resources available to
management, how these resources were financed and
what the firm accomplished with them. Business
shareholders annual reports include three required
financial statement.

10. According to Altman. E (1968)

In this study author talks about relationship among

various financial factors in a business as disclosed
by single set of statements and study of trends of those
factors as shown in a series of statements.

11. According to George, T. Schleifeer (2003)

He identified that financial analysis of companies is

usually undertaken so that investors, creditors and
other stakeholders can make decisions regarding their
companies. The focus of this paper is on the financial
analysis of companies who trade freely and therefore
make data and information that public needed by
stakeholders.

12. According to B. Mathivanan (2009)

This study expresses that the share examination is one
of the systems of coins related exam where in
proportions are carried out as a measuring stick for
assessing the budgetary condition and execution of a
agency. Translation and investigation of numerous
bookkeeping percentage offers a skilled examiner a
advanced comprehension of the cash associated
scenario and execution of company than what he may
want to have received in particular via an examination
of price range summaries. This examination clarified
the productiveness, Liquidity studies of IT businesses.

13. According to A. Sachin.V.Vijaya (2013)

This research depicted about percentage exam is a

specialized of presenting inner and outside occasions
influencing the enterprise exchanges figuring out with
its sports, operating consequences and achievement of
pre decided targets and locations of a corporate
company to sum matters up and rundown shape. In
percent exam a smooth surrender is drawn through
constructing up quantitative connection between at
the least matter of financial reviews. Thusly proportion
exam is used by each this kind of gatherings which
includes the executives to evaluate the exhibition of
the concern with assist of these proportions, liquidity
function, lengthy haul dissolvability, operating
productivity or gainfulness and effectiveness of a worry
can be assessed.

14. According to T. Ambika (2017)

The research featured the financial presentations in

more large experience alludes to how loads economic
factors being or has been practiced and is a massive
part of coins risk the executives. It is the manner
towards measuring the aftereffects of a commercial
enterprise employer’s processes and responsibilities in
money related terms. It is implemented to amount the
associations well known financial wellbeing over a
given time frame and might likewise be applied to
reflect on consideration on comparative groups over a
comparable industry or to have a look at companies or
areas in well known. This enterprise become made to
recognize the cash related execution of chose IT
corporations in India and their fashionable execution is
appropriate. A few contrasts had been set up from the
examination and guidelines had been produced the
usage of it. It is normal that selected IT agencies can
also boom their exhibition at the off hazard that they
take in to account the tips produced using the
discoveries of the research.

15. According to Pai, Vadivel and Kamala (1995)

They studied the diversified companies and financial

performance: A study and an effort was made to find
the relationship between diversified companies and
their financial situations. Seven large farms having
different products both related and otherwise in their
portfolio and operating in diverse industries were
analyzed .A set of performance measures, ratios was
employed to determine the level of financial situation.
The results reveals that the diversified firms studied
have been healthy financial performance. However,
variation in performance from one firm to another has
been observed and statistically established.

16. According to RBI study (1995)

This attempt was made to study the financial

performance of private corporate business sector
During the period 1994- 1995. Of the 1030 companies
covered in this study, 925 are non-financial companies
and 105 are financial companies. The result of the non-
financial and financial firms are also analyzed size wise
apart from analysis of consolidated results for entire
sector. The good corporate performance during 1994-
1995 reflected in major profitability ratios registering
distinct improvement in the year under review as
compared to previous.

17. According to Juliet D’Souza William L.M (1999)

They have studied the financial and operating

performance of privatization companies during the
1990’s. This study compares the pre and post
privatization financial and operating performance of 85
companies from 28 industrialized countries that were
privatized through public share offering for the period
from 1990 through 1996. Capital expenditure rises
significantly in absolute terms, but not relative to sales.
Employment declines, but significantly. The findings of
the study indicates strongly that privatization yields
significant performance improvements.
 3. Conclusion :

Wipro Limited. Is one of the leading company in

information and technology industry. Wipro have an
important role to play for economy as well as
investors. The literature indicates that the financial
position of Wipro is good but not as better than
Infosys. It has been noticed that studies on financial
performance in various departments provide divergent
results over the period of study. The main reason for
divergence in results is different in the method used
for measurement of factors mainly profitability,
solvency, liquidity, asset productivity growth rate in
operating performance and all the studies aimed to
analyze the financial performance in Indian industries.
The study of financial performance analysis of firm has
revealed the great deal of their various financial
aspects and useful suggestions are made, which means
the firm Wipro should do more to improve its financial
position for company growth.