Mumbai: Shares of IT major Wipro tumbled 7 percent Thursday, wiping off Rs 10,414 crore from its market valuation, after the company's March quarter earnings missed the street expectations.
The stock of the country's third-largest IT firm slumped 7 percent to settle at Rs 559.20 on BSE. During the day, it dipped 7.44 percent to Rs 556.55.
On NSE, the scrip tanked 7 percent to close at Rs 558.85.
Consequently, the company's market valuation declined by Rs 10,413.71 crore, to Rs 1,38,162.29 crore.
The blue-chip stock was the top loser among the frontlines on both Sensex and Nifty.
On the volume front, 8.47 lakh shares of the company changed hands at BSE and over 58 lakh shares were traded at NSE during the day.
"Wipro's March quarter results have missed expectations both on growth and margins," Emkay Global Financial Services said in a report.
Wipro yesterday reported 1.6 percent decline in March quarter profit to Rs 2,235 crore due to pressure on margins even as it aims to double revenue to USD 15 billion by 2020, while its board approved a Rs 2,500-crore share buyback plan.
The Azim Premji-led firm had registered a consolidated net profit of Rs 2,272 crore in the same quarter last fiscal.
IT services, which account for a lion's share of its turnover, saw margins drop by 10 basis points to 20.1 percent compared with the October-December quarter and by two percentage points on year-on-year basis and were also impacted by weakness in its financial and healthcare services business.
The company's board also approved a share buyback for Rs 2,500 crore. Wipro will buy up to 4 crore shares, representing 1.62 percent of the total paid-up capital, at Rs 625 apiece.
The company is looking to double its turnover to USD 15 billion by 2020 as it focuses more on digital and automation under the new management team.
It closed 2015-16 fiscal with about USD 7.7 billion in annual revenue. During the January-March quarter, Wipro's revenue rose 12.9 percent to Rs 13,741.7 crore.
Kotak Securities Senior Vice-President and Head of Private Client Group Research Dipen Shah said the revenue matched up with expectations but margins were below our expectations.
"Client?specific challenges in BFSI impacted growth while energy vertical continued to witness headwinds. The revenue guidance for Q1 indicates marginal growth on an organic basis, which is disappointing," he added.
Selling was also seen in other IT counters, with Tech Mahindra losing 1.46 percent, Infosys (1.36 percent) and TCS (1.17 percent) on BSE.
The BSE IT index fell by 1.53 percent to end at 11,410.62.
