BackAfter TCS, Wipro issues Q3 warning courtesy Chennai floods
Chennai floods to have a material impact on revenues, will result in higher one-time cost towards deployment of business continuity plan, says Wipro
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Chennai: The unprecedented rainfall and flooding in Chennai is likely to impact Wipro Ltd’s revenue and operating margins in the fiscal third quarter, the software services firm announced in a filing to the BSE on Wednesday.
The company said the incident is expected to have a material impact on revenues and will result in higher one-time cost incurred towards deployment of its business continuity plan for the quarter ending 31 December.
On Friday, Tata Consultancy Services (TCS), which has one of its largest delivery centres in Chennai with more than 65,000 employees, issued a similar warning. The company said the recent downpour had taken a toll on its operations in the city and would impact its third-quarter results.
“While majority of facilities in Chennai were opened for normal business functioning on Monday, December 7, 2015, attendance rates were lower than normal as employees were still recovering from the flood’s aftermath," TCS had said in a statement to investors.
Wipro has multiple facilities in Chennai with over 22,000 employees. Business continuity plans were invoked to ensure there was no disruption in the business-critical operations of customers.
Wipro had forecast that the revenues for the third quarter from the company’s IT services business are expected to be in the range of $1,841 million to $1,878 million. “However, we expect revenues to be in the lower half of the guidance range," said the firm in a statement.
On Wednesday, Wipro’s shares closed at Rs555.00 apiece, down 0.64%, on the BSE while the benchmark Sensex ended the day 0.69% lower at 25,494.37 points.
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