Mar 31, 2023
It gives me immense pleasure to present the 77th Board''s Report, on behalf of the Board of Directors (the âBoardâ) of the Company, along with the Balance Sheet, Profit and Loss account and Cash Flow statements, for the financial year ended March 31, 2023.
On a consolidated basis, your Company''s sales increased to H 904,876 Million for the current year as against H 790,934 Million in the previous year, recording
an increase of 14.41%. Your Company''s net profits decreased to H 113,665 Million for the current year as against H 122,434 Million in the previous year, recording a decrease of 7.16%.
On a standalone basis, your Company''s sales increased to H 677,534 Million for the current year as against H 595,744 Million in the previous year, recording an increase of 13.73%. Your Company''s net profits decreased to H 91,767 Million in the current year as against H 121,353 Million in the previous year, recording a decrease of 24.38%.
Key highlights of financial performance of your Company for the financial year 2022-23 are provided below:
(H in Millions) Standalone Consolidated |
||||
2022-23 |
2021-22 |
2022-23 |
2021-22 |
|
Sales |
677,534 |
595,744 |
904,876 |
790,934 |
Other Operating Income |
- |
- |
- |
2,186 |
Other Income |
23,542 |
47,061 |
22,657 |
20,612 |
Operating Expenses |
(578,387) |
(490,163) |
(779,819) |
(662,381) |
Share of net profit/ (loss) of associates accounted for using the equity method |
- |
- |
(57) |
57 |
Profit before Tax |
122,689 |
152,642 |
147,657 |
151,408 |
Provision for Tax |
30,922 |
31,289 |
33,992 |
28,974 |
Net profit for the year |
91,767 |
121,353 |
113,665 |
122,434 |
Other comprehensive (loss)/income for the year |
(6,098) |
(1,487) |
10,738 |
11,452 |
Total comprehensive income for the year |
85,669 |
119,866 |
124,403 |
133,886 |
Total comprehensive income for the period attributable to: |
||||
Minority Interest |
- |
- |
217 |
187 |
Equity holders |
85,669 |
119,866 |
124,186 |
133,699 |
Appropriations |
||||
Dividend |
5,487 |
32,891 |
5,477 |
32,804 |
Equity Share Capital |
10,976 |
10,964 |
10,976 |
10,964 |
EPS |
||||
- Basic |
16.75 |
22.20 |
20.73 |
22.37 |
- Diluted |
16.72 |
22.14 |
20.68 |
22.31 |
Note: The standalone and consolidated financial statements of the Company for the financial year ended March 31, 2023, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs and as amended from time to time. |
Pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (âListing Regulationsâ), the Board has approved and adopted a Dividend Distribution Policy. The policy details various considerations based on which the Board may recommend or declare Dividend, Company''s dividend track record, usage of retained earnings for corporate actions, etc. The Dividend Distribution policy and Capital Allocation policy are available on the Company''s website at https://www.wipro.com/content/ dam/nexus/en/investor/corporate-governance/ policies-and-guidelines/ethical-guidelines/12769-dividend-distribution-policy.pdf.
Pursuant to the approval of the Board on January 13, 2023, your Company paid an interim dividend of H 1 per equity share of face value of H 2 each, to shareholders whose names were appearing in the register of members as on January 25, 2023, being the record date fixed for this purpose, after deduction of applicable taxes. The total net cash outflow was of H 4,947 Million, resulting in a dividend payout of 5.39% of the standalone profits of the Company.
The interim dividend of H 1 per equity share declared by the Board on January 13, 2023 shall be the final dividend for the financial year 2022-23.
Your Company is in compliance with its Dividend Distribution Policy and Capital Allocation Policy as approved by the Board.
On April 27, 2023, the Board of Directors of your Company approved the buyback of equity shares, subject to the approval of shareholders, for purchase by the Company of up to 269,662,921 equity shares of H 2 each (being 4.91% of the total number of equity shares in the paid-up equity capital of the Company) from the shareholders of the Company on a proportionate basis by way of a tender offer at a price of H445 per equity share for an aggregate amount not exceeding H120,000 Million, in accordance with the provisions contained in the Securities and Exchange Board of India (Buy-back of Securities) Regulations, 2018, the Companies Act, 2013 and Rules made thereunder. Taxes and transaction costs due on the buyback of equity shares will be paid separately.
Appropriations to general reserves for the financial year ended March 31, 2023, as per standalone and consolidated financial statements were:
(H in Millions) |
|||
Standalone |
Consolidated |
||
Net profit for the year |
91,767 |
113,500* |
|
Balance of Reserves at the beginning of the year |
532,543 |
643,066 |
|
Balance of Reserves at the end of the year |
616,647 |
765,703 |
|
* Excluding non-controlling interest |
For complete details on movement in Reserves and Surplus during the financial year ended March 31, 2023, please refer to the Statement of Changes in Equity included in the Standalone and Consolidated financial statements on page nos. 163 to 164 and 245 to 246 respectively of this Annual Report.
During the financial year 2022-23, the Company allotted 5,847,626 equity shares consequent to exercise of employee stock options. The equity shares allotted/ transferred under the Employee Stock Option Schemes shall rank pari-passu with the existing equity shares of the Company. The paid-up equity share capital of the Company as of March 31, 2023, stood at H 10,976 Million consisting of 5,487,917,741 equity shares of H 2 each.
As on March 31,2023, your Company had 159 subsidiaries and 1 associate. In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided at page nos. 330 to 336 of this Annual Report. The statement also provides subsidiaries incorporated during the financial year, details of performance and financial position of each of the subsidiaries and associates.
Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at https://www.wipro.com/investors/annual-reports/.
Your Company funds its subsidiaries, from time to time, in the ordinary course of business and as per the funding requirements, through equity, loan, guarantee and/or other means to meet working capital requirements.
In terms of the Company''s Policy on determining âmaterial subsidiaryâ, during the financial year ended March 31, 2023, Wipro LLC was determined as a material subsidiary whose income exceeds 10% of the consolidated income of the Company in the immediately preceding financial year. Further details on the subsidiary monitoring framework have been provided as part of the Corporate Governance report.
Particulars of Loans, Guarantees and Investments
Pursuant to Section 186 of the Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to Loans, Guarantees and Investments are provided as part of the financial statements.
Celebrating over 75 years of innovation, Wipro is a purpose-driven, global technology services and consulting firm with over 250,000 employees across six continents helping our Company''s customers, communities and planet thrive in the digital world.
Wipro is recognized globally for its strong commitment to sustainability. Your Company nurtures inclusivity as an intrinsic part of its culture. Your Company''s deep resolve to improve the communities we live and work in, is appreciated by its customers, investors, analysts, and employees.
Your Company aspires to be a âvalue orchestrator'' to its clients - an end-to-end digital transformation partner that delivers personalized outcomes through holistic solutions. To achieve this, your Company proactively conceptualizes, orchestrates and seamlessly deploys value by bringing together domain knowledge, technologies, partners and hyperscalers to solve complex problems for its clients.
Wipro''s holistic portfolio of capabilities and ability to navigate vertically and horizontally across ecosystems helps its clients achieve competitive advantage. Our focus is to maximize business outcomes by converging themes across industry domains, products, services, and partners as your Company develops and delivers tailored business solutions for its clients. This combined with operational excellence, automation, higher productivity and integration of consulting and technology practices, strengthens your Company''s ability to deliver industry solutions effectively and at scale. Your Company is focused towards building longterm relationships with customers and tightly aligned visions and outcomes structured through a highly governed and co-managed engagement process.
Wipro''s IT Services segment provides a range of IT and IT-enabled services which include digital strategy advisory, customer-centric design, consulting, custom
application design, development, re-engineering and maintenance, systems integration, package implementation, global infrastructure services, analytics services, business process services, research and development and, hardware and software design to leading enterprises worldwide.
Wipro''s IT Products segment provides a range of third-party IT products, which allows it to offer comprehensive IT system integration services. These products include computing, platforms and storage, networking solutions, enterprise information security and software products, including databases and operating systems. Your Company provides IT products majorly as a complement to its IT services offerings rather than sell standalone IT products, and its focus continues to be on consulting and digital engagements, with a more selective approach in bidding for system integration engagements.
Wipro''s ISRE segment consists of IT Services offerings to organizations owned or controlled by the GoI and/or any Indian State Governments. Your Company''s ISRE strategy focuses on consulting and digital engagements with ISRE Customers.
Further information on your Company''s IT services and products offerings, industry and business overview are presented as part of the Management Discussion and Analysis Report (âMD & A Reportâ) from page no. 28 onwards.
Material Changes and Commitments affecting the Business Operations and Financial Position of the Company
Global economic activity experienced a sharper-than-expected slowdown in the financial year 2022-23. With central banks raising interest rates and food and energy prices coming down, global inflation is gradually subsiding. This has resulted in marginal improvement in business and household buying power.
Verticals across the globe are showcasing signs of caution in their technology spending basis short-term and long-term priorities. The factors such as high inflation and potential recession across the globe have forced companies to drive cost optimization in their operations, invest in operational excellence and drive vendor consolidation. Companies are relying on technologies like cloud, AI and automation to achieve optimization and increase efficiency. Thus, the volatile global scenario is supporting the demand for technology adoption and digital acceleration. As the banking sector faces margin pressures, overall BFSI technology spends will observe greater caution and delay.
Additional information regarding your Company''s business operations and financial position are provided as part of the MD & A Report from page no. 28 onwards.
The near-term outlook remains highly uncertain with downside risks of impact from tighter monetary policy, inflation and recession fears, pressures in global energy markets reappearing, unpredictable course of the geopolitical conflict in Europe, and the recent increase in financial market volatility. The rapid tightening of fiscal policies has exposed vulnerabilities both among banking and non-banking financial institutions, showcasing fluctuations in the financial conditions with the shift in sentiment. This may result in slowdown in demand in certain markets and lead to delayed decision making.
Technology spending is forecasted to increase with enterprises'' CIOs investing in value-driven transformation focused on areas like cloud transformation, automation, integration of AI, data analytics and cybersecurity as their top priorities. The demand for digital transformation and infrastructure modernization will continue to drive growth for the industry with accelerated adoption of digital and emerging technologies, such as next generation AI, augmented reality (âARâ), vi rtual reality (âVRâ), extended reality (âXRâ), web3 and metaverse, 5G and edge, cyber and bio convergence. While the emerging technologies will disrupt industries, they will also pose new risks in the areas of data privacy, surveillance and ownership.
According to the Strategic Review 2023 published by NASSCOM (the âNASSCOM Reportâ), revenue for the Indian IT services'' sector is expected to witness growth of 8.3% year-on-year in fiscal year 2023, led by IT modernization including application modernization, cloud migration and platformization. Digital revenues are estimated to account for 32%-34% of total industry revenue, growing at 16% annually in fiscal year 2023. IT services contracts will include a significant digital component, led by digital transformation, cloudification, platform engineering, AI, building software-as-a-service (âSaaSâ) enabled products and associated consulting services. According to the NASSCOM Report, next generation technologies, such as sensor technology, smart robots, autonomous driving, computer vision, deep learning, autonomous analytics, AR/VR, sustainability technology, edge computing, distributed ledger, spacetech and 5G/6G, are expected to witness twice the average growth in fiscal year 2023.
Acquisitions, Divestments, Investments and Mergers
Your Company''s strategy supports value creation for clients and growth for the organization through five strategic priorities: accelerate growth, strengthen clients and partnerships, lead with business solutions, building talent at scale, and a simplified operating model.
The Company focuses its efforts and investments on maximum results, going deeper in areas that it believes it has the strength and defocusing on others, and scaling up to secure leadership positions.
Your Company''s new strategy will bring it closer to clients, drive greater agility and responsiveness and help us become the employer of choice. Further, your Company had invested in acquiring new technology and skills.
Details of the transactions completed by your Company are listed below:
a) In November 2022, Wipro IT Services UK Societas acquired remaining 51% equity stake in Wipro Doha LLC. Consequent to the acquisition of the additional equity stake, the holding in Wipro Doha LLC increased from 49% to 100%.
b) I n December 2022, your Company completed the acquisition of additional 3.3% equity stake in Encore Theme Technologies Private Limited (âEncore Themeâ). With the completion of the acquisition of aforesaid equity stake, Encore Theme has become a wholly owned subsidiary of your Company w.e.f. December 27, 2022.
c) In December 2022, Wipro LLC sold its Preferred Shares to Harte Hanks, Inc. by way of repurchase of shares.
d) I n December 2022, the membership interest held by Wipro Gallagher Solutions LLC in Wipro Opus Risk Solutions, LLC was sold.
e) Wipro Ventures, the strategic investment arm of Wipro, invests in enterprise software and cybersecurity startups. These investments span across the Enterprise IT stack, and include areas like, Analytics, Business Automation, Cloud Infrastructure, Cybersecurity, Data Management, DevOps, IoT, Test Automation, among others. During the financial year 2022-23, Wipro Ventures has invested in five companies i.e Securonix, Qwiet.ai, Kibsi, Kognitos, and Spartan Radar.
f) During the financial year 2022-23, your Company has carried out the merger of Cardinal Foreign Holdings S.a r.l. and Cardinal Foreign Holdings 2 S.a r.l. with and into Grove Holdings 2 S.a r.l, merger of Wipro Italia S.R.L into Mechworks S.R.L, and amalgamation of Rizing Canada Holdings Corp. with Rizing Solutions Canada Inc.
g) During the financial year 2022-23, 14 subsidiaries of your Company i.e., Wipro Poland Sp. z o.o., Wipro US foundation, Neos Holdings LLC, Neos Software LLC, Capco (US) GP LLC, Capco (US) LLC, Neos LLC, Rizing Intermediate Inc, Rizing Intermediate LLC, Rizing Inc, Attune Hong Kong Limited, Vesta Macau Limited, Capco (Canada) LP and Capco (Canada) GP ULC were de-registered.
Management Discussion and Analysis Report
In terms of Regulation 34 of the Listing Regulations and SEBI circular no. SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (âIIRCâ) as part of its MD & A Report. The MD & A report, capturing your Company''s performance, industry trends and other material changes with respect to your Company''s and its subsidiaries, wherever applicable, are presented from page no. 28 onwards of this Annual Report.
The MD & A Report provides a consolidated perspective of economic, social and environmental aspects material to your Company''s strategy and its ability to create and sustain value to its key stakeholders and includes aspects of reporting as required by Regulation 34 of the Listing Regulations on Business Responsibility Report.
Business Responsibility & Sustainability Report
Pursuant to Regulation 34(2)(f) of the Listing Regulations and SEBI circular no. SEBI/LAD-NRO/ GN/2021/2 dated May 5, 2021, your Company
provides the prescribed disclosures in new reporting requirements on Environmental, Social and Governance (âESGâ) parameters called the Business Responsibility and Sustainability Report (âBRSRâ) which includes performance against the nine principles of the National Guidelines on Responsible Business Conduct and the report under each principle which is divided into essential and leadership indicators. The BRSR is provided from page nos. 419 to 449 of this Annual Report.
III. GOVERNANCE AND ETHICS Corporate Governance
Your Company believes in adopting best practices of corporate governance. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Company''s code of business conduct, Corporate Governance Guidelines, charter of various sub-committees and disclosure policy.
As per Regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided at page no. 123 onwards.
Boardâs Composition and Independence
Your Company''s Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31, 2023, the Board comprised of two Executive Directors, six non-executive Independent Directors and one non-executive nonIndependent Director.
Definition of âIndependence'' of Directors is derived from Regulation 16 of the Listing Regulations, New York Stock Exchange (âNYSEâ) Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company
has received necessary declarations under Section 149(7) of the Companies Act, 2013 and Regulation 25(8) of the Listing Regulations, from the Independent Directors stating that they meet the prescribed criteria for independence. The Board, after undertaking assessment and on examination of the relationships disclosed, considered the following Non-Executive Directors as Independent Directors:
Ms. Ireena Vittal
Mr. Deepak M. Satwalekar
Dr. Patrick J. Ennis
Mr. Patrick Dupuis
Ms. Tulsi Naidu
Ms. Paivi Rekonen
All Independent Directors have affirmed compliance to the code of conduct for independent directors as prescribed in Schedule IV to the Companies Act, 2013.
The Board met six times during the financial year 202223 on April 12, 2022, April 28-29, 2022, June 8, 2022, July 19-20, 2022, October 11-12, 2022 and January 1213, 2023. The necessary quorum was present for all the meetings. The maximum interval between any two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
Pursuant to recommendation of the Nomination and Remuneration Committee, the Board had, on July 20, 2022, approved the appointment of Ms. Paivi Elina Rekonen Fleischer (DIN: 09669696) as an Additional Director in the capacity of Independent Director for a term of 5 years with effect from October 1, 2022 to September 30, 2027, subject to approval of the shareholders of the Company. The said appointment was approved by shareholders of the Company vide special resolution dated November 22, 2022, passed through postal ballot by e-voting.
Mr. William A. Owens retired as an Independent Director from the Board of the Company with effect from July 31, 2022. The Board places on record the immense contributions made by Mr. William A. Owens to the growth of you r Company over the years.
In the opinion of the Board, all our Directors, as well as the Director appointed during the financial year, possess
requisite qualifications, experience, expertise and hold high standards of integrity. List of key skills, expertise, and core competencies of the Board, including the Independent Directors, is provided at page no. 126 of this Annual Report.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Thierry Delaporte (DIN: 08107242) will retire by rotation at the 77th AGM and being eligible, has offered himself for re-appointment.
Your Company''s Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as Risk Management Committee.
2. Nomination and Remuneration Committee (formerly known as Board Governance, Nomination and Compensation Committee), which also acts as Corporate Social Responsibility Committee
3. Administrative and Shareholders/Investors Grievance Committee (Stakeholders Relationship Committee).
Details of terms of reference of the Committees, Committee membership changes, and attendance of Directors at meetings of the Committees are provided in the Corporate Governance report from page nos. 131 to 134 of this Annual Report.
In line with the Corporate Governance Guidelines of the Company, Annual Performance Evaluation was conducted for all Board Members as well as the working of the Board and its Committees. This evaluation was led by the Chairman of the Nomination and Remuneration Committee with specific focus on performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in accordance with the Guidance Note on Board Evaluation issued by SEBI in January 2017. The Board evaluation was conducted through questionnaire designed with qualitative parameters and feedback based on ratings.
Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance of Executive Directors, succession planning, strategic planning, etc.
Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience, and expertise to provide feedback and guidance to top management on business strategy, governance, risk and understanding of the organization''s strategy, etc.
The outcome of the Board Evaluation for the financial year 2022-23 was discussed by the Nomination and Remuneration Committee and the Board at their respective meetings held in April 2023. The Board has received highest ratings on Board communication and relationships, legal and financial duties of the Board and composition and role of the Board. The Board noted the actions taken in improving Board effectiveness based on feedback given in the previous year. In light of the external environment, the Board recommended additional focus on the area of risk management.
Policy on Directorâs Appointment and Remuneration
The Board, on the recommendation of the Nomination and Remuneration Committee, has framed the policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel (âKMPâ), Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013.
Pursuant to Section 134(3) of the Companies Act, 2013, the nomination and remuneration policy of the Company which lays down the criteria for determining qualifications, competencies, positive attributes and independence for appointment of Directors and policies of the Company relating to remuneration of Directors, KMP and other employees is available on the Company''s website at https://www.wipro.com/content/
dam/nexus/en/investor/corporate-governance/ policies-and-guidelines/ethical-guidelines/wipro-limited-remuneration-policy.pdf. We affirm that the remuneration paid to Directors, Senior Management and other employees is in accordance with the remuneration policy of the Company.
The Board, on the recommendation of the Nomination and Remuneration Committee, has framed a policy for Board Diversity which lays down the criteria for appointment of Directors on the Board of your Company and guides organization''s approach to Board Diversity.
Your Company believes that Board diversity basis the gender, race, age will help build diversity of thought and will set the tone at the top. A mix of individuals representing different geographies, culture, industry experience, qualification and skill set will bring in different perspectives and help the organization grow. The Board of Directors is responsible for review of the policy from time to time. Policy on Board Diversity has been placed on the Company''s website at https:// www.wipro.com/content/dam/nexus/en/investor/ corporate-governance/policies-and-guidelines/ethical-guidelines/policy-on-appointment-of-directors-and-board-diversity.pdf.
Your Company has implemented an Enterprise Risk Management (âERMâ) framework based on globally recognized standards and industry best practices. The ERM framework is administered by the Audit, Risk and Compliance Committee. The ERM framework enables business by promoting a risk resilient culture, proactive management of âEmerging'' risks and is supported by technology. The framework governs all categories of risks, the effectiveness of the controls that have been implemented to prevent such risks and continuous improvement of the systems and processes to proactively identify and mitigate such risks. For more details on the Company''s risk management framework, please refer to page nos. 36 to 39 of this Annual Report.
Being an IT & ITES service provider, your Company''s high business dependency on its information technology and secured digital infrastructure, to interconnect offices,
employee systems, partners and clients for the day-today business operations, as well as our hosting of data and service delivery, are susceptible to potential cyber event impacting confidentiality, integrity and availability of the technology environment. The cyber event(s) may lead to financial loss, disclosure of data, breach of privacy or security impacting reputation, trust, revenue, through legal, regulatory and contractual obligations. Such event(s) may directly impact your Company and its relationships with its clients and partners.
Owing to the rise of connected devices, transition to cloud and use of other emerging technologies, and other factors, the impact of threats continue to increase while the threat attack area is evolving and increasing beyond the enterprise. There may be vulnerabilities in opensource software incorporated into your Company''s offerings that may make the offerings susceptible to cyberattacks.
I n view of increased cyberattack scenarios, the cyber security maturity is reviewed periodically and the processes, technology controls are being enhanced in-line with the threat scenarios. Your Company''s technology environment is enabled with real time security monitoring with requisite controls at various layers starting from end user machines to network, application and the data.
Compliance Management Framework
The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances and provide update to the senior management and Board on a periodic basis. The Audit, Risk and Compliance Committee and the Board periodically monitor status of compliances with applicable laws.
Code for Prevention of Insider Trading
Your Company has adopted a Code of Conduct to regulate, monitor and report trading by designated persons and their immediate relatives as per the requirements under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. The Code, inter alia, lays down the procedures to be followed by designated persons while trading/ dealing in Company''s shares and sharing Unpublished
Price Sensitive Information (âUPSIâ). The Code covers Company''s obligation to maintain a digital database, mechanism for prevention of insider trading and handling of UPSI, and the process to familiarize with the sensitivity of UPSI. Further, it also includes code for practices and procedures for fair disclosure of unpublished price sensitive information which has been made available on the Company''s website at https:// www.wipro.com/content/dam/nexus/en/investor/ corporate-governance/policies-and-guidelines/ethical-guidelines/12765-code-of-practices-and-procedures-for-fair-disclosure-of-upsi.pdf.
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013, Regulation 22 of the Listing Regulations and Regulation 9A of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.
Under this policy, your Company encourages its employees to report any incidence of fraudulent financial or other information to the stakeholders, reporting of instance(s) of leak or suspected leak of unpublished price sensitive information, and any conduct that results in violation of the Company''s code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation, or harassment of any kind against any employee who reports under the Vigil Mechanism or participates in the investigation.
Awareness of policies is created by, inter alia, sending group mailers highlighting actions taken by the Company against the errant employees. Mechanism followed under the Ombuds process has been displayed on the Company''s intranet and website at https://www.wipro. com/investors/corporate-governance/policies-and-gui delines/#WiprosOmbudsProcess.
All complaints received through Ombuds process and investigative findings are reviewed and approved by the Chief Ombuds person. All employees and stakeholders can also register their concerns either by sending an email to [email protected] or through web-based portal at https://www.wipro.com/investors/ corporate-governance/policies-and-guidelines/#Wip
rosOmbudsProcess. Following an investigation of the concerns received, a decision is made by the appropriate authority on the action to be taken basis the findings of such investigation. In case the complainant is nonresponsive for more than 15 days, the concern may be closed without further action.
The below table provides details of complaints received/disposed during the financial year 2022-23:
No. of complaints pending at the beginning of financial year |
82 |
No. of complaints filed during the financial year |
1199 |
No. of complaints disposed during the financial year |
1197 |
No. of complaints pending at the end of the financial year |
84 |
All cases were investigated, and actions taken as deemed appropriate. Based on self-disclosure data, 14% of these cases were reported anonymously. The top categories of complaints were non-adherence to internal policy/process at 46%, followed by workplace concerns and behavioural issues at 23%. The majority of cases (60%) were resolved through engagement of human resources or mediation or closed since they were unsubstantiated.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company were denied access to the Audit, Risk and Compliance Committee.
Information Required under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013
The Company is committed to providing a safe and conducive work environment to all its employees and associates. Your Company has constituted an Internal Complaints Committee under the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and has a policy and framework for employees to report sexual harassment cases at workplace. The Company''s process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization. The below table provides details of complaints received/ disposed during the financial year 2022-23.
Number of complaints at the beginning of financial year |
12* |
No. of complaints filed during the financial year |
141 |
No. of complaints disposed during the financial year |
134 |
No. of complaints pending at the end of financial year |
19 |
*Of the 13 complaints pending at the end of the previous year, 1 complaint was found to be invalid due to lack of response from the complainant.
As per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company follows calendar year for annual filling with statutory authority and as per the filing, a total of 51 complaints related to sexual harassment were raised in the calendar year 2022.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at arm''s length as part of its philosophy of adhering to highest ethical standards, transparency, and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. The policy on related party transactions has been placed on the Company''s website at https://www.wipro.com/content/dam/ nexus/en/investor/corporate-governance/policies-and-guidelines/ethical-guidelines/policy-for-related-party-transactions.pdf.
Prior omnibus approval of the Audit, Risk and Compliance Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature. All related party transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for review and approval.
All contracts, arrangements and transactions entered by the Company with related parties during financial year 2022-23 were in the ordinary course of business and on an arm''s length basis. There were no contracts, arrangements or transactions entered during financial year 2022-23 that fall under the scope of Section 188(1) of the Companies Act, 2013. Accordingly, the prescribed Form AOC-2 is not applicable to the Company for the financial year 2022-23 and hence does not form part of this report.
Details of transaction(s) of your Company with entity(ies) belonging to the promoter/promoter group which hold(s) more than 10% shareholding in the Company as required under para A of Schedule V of the Listing Regulations are provided as part of the financial statements.
Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed the reports on related party transactions with the Stock Exchanges.
Directorsâ Responsibility Statement
Your Directors hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures.
b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period.
c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities.
d) the Directors have prepared the annual accounts on a going concern basis.
e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively.
f) adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Company''s Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Wipro Employee Stock Option Plans/ Restricted Stock Unit Plans
Your Company has instituted various employee stock options plans/restricted stock unit plans from time to time to motivate, incentivize, and reward employees.
The Nomination and Remuneration Committee administers these plans. The stock option plans are in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits and Sweat Equity) Regulations, 2021, as amended (âEmployee Benefits Regulationsâ) and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations are available on the Company''s website at https://www.wipro. com/investors/annual-reports/. No employee was issued stock options during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
Your Company has received a certificate from the secretarial auditor confirming implementation of the plans in accordance with the Employee Benefits Regulations.
Information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure I to this report.
A statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of H 102 lakhs or more and, employees employed for part of the year and in receipt of remuneration of H 8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report.
IV. INTERNAL FINANCIAL CONTROLS AND AUDIT Internal Financial Controls and their adequacy
The Board of your Company has laid down internal financial controls to be followed by the Company and such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Company''s policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
At the 76th AGM held on July 19, 2022, Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 117366W/W-100018) was re-appointed as statutory auditors of the Company for a second term of five consecutive years from the financial year 2022-23 onwards.
Deloitte Haskins & Sells LLP, Statutory Auditors, have issued an unmodified opinion on the financial statements of the Company. There are no qualifications, reservations or adverse remarks made by the Auditors, in their report for the financial year ended March 31,2023.
Pursuant to provisions of the Section 143(12) of the Companies Act, 2013, neither the Statutory Auditors nor the Secretarial Auditor has reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V. Sreedharan, Partner, V. Sreedharan & Associates, a firm of Company Secretaries in Practice, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31,2023, is enclosed as Annexure III to this Report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
V. KEY AWARDS AND RECOGNITIONS
Your Company is one of the most admired and recognized companies in the IT industry. Your Company has won several awards and accolades, details of which are provided at page nos. 26 to 27 of this Annual Report.
VI. SOCIAL RESPONSIBILITY ANDSUSTAINABILITYCorporate Social Responsibility
At Wipro, we think that it is critical to engage with the social and ecological challenges that humanity is facing in a deep, meaningful, and systemic manner. We believe in contributing towards creating a more just, equitable, humane, and sustainable society. Your Company chooses to work on domain and issues that are widely recognized as being vital enablers of societal progress
and community-resilience with positive impacts over the long term on livelihoods, health and well-being, gender equity, economic productivity, and democratic participation. Our CSR policy reflects principles and strategies that have informed our long history of corporate citizenship and social responsibility.
We are committed to an approach that is focused on bringing change from the inside out at four different levels:
1. Fulfilling primary fiduciary duties and regulatory obligations as reflected in high levels of corporate governance and transparency;
2. Proactive approach to initiatives inside the organizational ecosystem that demonstrate our commitment to a more humane and sustainable world;
3. Engaging with, and contributing to, relevant issues in neighborhood communities, in all regions and countries;
4. Using the power of collaboration and advocacy to influence larger societal progress.
Our CSR programs'' implementation happens through multiple channels - Wipro Foundation, Wipro Cares, and through functions and groups within the Company. Your company works with a network of over 230 committed partner organizations who collectively implemented approximately 300 projects across India, the US, UK, Philippines, Romania, France, among others, with collective positive impacts on over 2 Million people.
As per the provisions of the Companies Act, 2013, a company meeting the specified criteria shall spend at least 2% of its average net profits for three immediately preceding financial years towards CSR activities. Accordingly, your Company spent H 2,157 Million towards CSR activities during the financial year 2022-23.
The Board of Directors noted that your Company''s CSR spend for the year ended March 31, 2023, was H 2,157 Million as against its obligation of H 1,986 Million. Pursuant to the recommendation by Nomination and Remuneration Committee and approval by the Board of Directors, an aggregate amount of H 508 Million was set off for financial year 2022-23. An excess of H 679 Million which was spent in financial year 2022-23 is available for set-off in a time frame of three immediately succeeding years, in equal proportion.
The contents of the CSR policy and the CSR Report as per the format notified in the Companies (Corporate
Social Responsibility Policy) Rules, 2014, as amended from time to time, is attached as Annexure IV to this report. CSR policy is also available on the Company''s website at https://www.wipro.com/content/dam/nexus/ en/investor/corporate-governance/policies-and-guidelines/ethical-guidelines/12773-policy-on-corporate-social-responsibility.pdf.
The terms of reference of CSR committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Nomination and Remuneration Committee. The Committee consists of three Independent Directors, Ms. lreena Vittal, Mr. Patrick Dupuis and Mr. Deepak M. Satwalekar as its members. Ms. lreena Vittal is the Chairperson of the Committee.
Effective April 1, 2023, Ms. Tulsi Naidu, Independent Director, was appointed as member of the Committee. We affirm that the implementation and monitoring of CSR activities is in compliance with the Company''s CSR objectives and policy.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its âSustainabilityâ initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD & A Report.
VII. DISCLOSURESForeign Exchange Earnings and Outgoings
During the financial year 2022-23, your Company''s foreign exchange earnings were H 637,061 Million and foreign exchange outgoings were H 313,746 Million as against H 548,490 Million of foreign exchange earnings and H 259,602 Million of foreign exchange outgoings for the financial year 2021-22.
Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the Company has placed a copy of the Annual Return as of March 31, 2023, on its website at https://www.wipro.com/investors/annual-reports/.
a) Your Company has not accepted any deposits from the public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
b) Your Company has not issued shares with differential voting rights and sweat equity shares during the year under review.
c) Your Company has complied with the applicable Secretarial Standards relating to âMeetings of the Board of Directors'' and âGeneral Meetings'' during the year.
d) Maintenance of cost records and requirement of cost Audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable to the business activities carried out by the Company.
e) There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.
f) Details of unclaimed dividends and equity shares transferred to the Investor Education and Protection Fund authority have been provided as part of the Corporate Governance report.
g) There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.
h) There were no instances where your Company required the valuation for one time settlement or while taking the loan from the Banks or Financial institutions.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of the Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence have ensured that the Company continues to be a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors,
Bengaluru Rishad A. Premji
May 24, 2023 Chairman
(DIN: 02983899)
Mar 31, 2021
Dear Members,
On behalf of the Board of Directors (the âBoardâ) of the Company, it gives me immense pleasure to present the 75th Boardâs Report, along with the Balance Sheet, Profit and Loss Account and Cash Flow Statements, for the financial year ended March 31,2021.
The standalone and consolidated financial statements of the Company for the financial year ended March 31, 2021, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs and as amended from time to time.
On a consolidated basis, your Companyâs sales increased to '' 619,430 million for the current year as against '' 610,232 million in the previous year, recording an increase of 1.51%. Your Companyâs net profits increased to '' 108,680 million for the current year as against '' 97,718 million in the previous year, recording an increase of 11.22%.
On a standalone basis, your Companyâs sales decreased to '' 502,994 million for the current year as against '' 503,877 million in the previous year, recording a decrease of -0.18%. Your Companyâs net profits increased to '' 100,609 million in the current year as against '' 86,807 million in the previous year, recording an increase of 15.90%.
Key highlights of financial performance of your Company for the financial year 2020-21 are provided below: ('' in millions) Standalone Consolidated |
||||
2020-21 |
2019-20 |
2020-21 |
2019-20 |
|
Sales |
502,994 |
503,877 |
619,430 |
610,232 |
Other Operating Income |
- |
193 |
(81) |
1,144 |
Other Income |
23,829 |
24,766 |
23,907 |
27,250 |
Profit before Tax |
126,848 |
110,077 |
139,029 |
122,519 |
Provision for Tax |
26,239 |
23,270 |
30,349 |
24,801 |
Net profit for the year |
100,609 |
86,807 |
108,680 |
97,718 |
Other comprehensive (loss)/income for the year |
6,337 |
(4,284) |
6,817 |
4,257 |
Total comprehensive income for the year |
106,946 |
82,523 |
115,497 |
101,975 |
Total comprehensive income for the period attributable to: |
||||
Minority Interest |
- |
- |
663 |
653 |
Equity holders |
106,946 |
82,523 |
114,834 |
101,322 |
Appropriations |
||||
Dividend |
5,478 |
5,713 |
5,459 |
5,689 |
Tax on distribution of dividend |
- |
1,174 |
- |
1,174 |
EPS |
||||
- Basic |
17.81 |
14.88 |
19.11 |
16.67 |
- Diluted |
17.77 |
14.84 |
19.07 |
16.63 |
Pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (âListing Regulationsâ), the Board has approved and adopted a Dividend Distribution Policy. The policy details various considerations based on which the Board may recommend or declare Dividend, your Companyâs dividend track record, usage of retained earnings for corporate actions, etc. The Dividend Distribution policy and Capital Allocation Policy are available on the Companyâs website athttps://www.wipro.com/ content/dam/nexus/en/investor/corporate-governance/ policies-and-guidelines/ethical-guidelines/12769-dividend-distribution-policv-october-2016.pdf.
Pursuant to the approval of the Board on January 13, 2021, your Company paid an interim dividend of '' 1/- per equity share of face value of '' 2/- each, to shareholders who were on the register of members as on January 25, 2021, being the record date fixed for this purpose, after deduction of applicable taxes. The Board did not recommend a final dividend and the interim dividend of '' 1/- per equity share declared by the Board in January 2021 shall be the final dividend for the financial year 2020-21. Thus, the total dividend for the financial year 2020-21 remains '' 1/- per equity share.
Your Company is in compliance with its Dividend Distribution Policy and Capital Allocation Policy as approved by the Board.
provided at page nos. 302 to 308 of this Annual Report. The statement also provides details of performance and financial position of each of the subsidiaries.
Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company athttps://www.wipro.com/investors/annual-reports/
Your Company funds its subsidiaries, from time to time, in the ordinary course of business and as per the funding requirements, through equity, loan, guarantee and/or other means to meet working capital requirements.
In terms of the Companyâs Policy on determining âmaterial subsidiaryâ, during the financial year ended March 31, 2021, Wipro LLC was determined as a material subsidiary whose income exceeds 10% of the consolidated income of the Company in the immediately preceding financial year. Further details on the subsidiary monitoring framework have been provided as part of the Corporate Governance report.
In June 2021, Wipro IT Services LLC, a wholly owned step-down subsidiary of your Company incorporated under the laws of Delaware, United States of America has approved the proposal for issuance of U.S. dollar denominated notes (âNotesâ) in an aggregate principal amount of up to US$ 750 million. The Notes will be guaranteed by the Company vide a corporate guarantee. The net proceeds of the Notes are intended to be utilised for refinancing or repaying existing debt, general corporate purposes and/or for any other purpose permitted by law. The Notes are proposed to be listed on the Singapore Stock Exchange.
The Board of Directors of your Company, at their meeting held on June 9, 2021, granted its approval to unconditionally and irrevocably guarantee the due and prompt payment of the principal and interest and any additional amount payable in respect of the Notes, as and when the same shall become due and payable. The Guarantee is subject to the aggregate liability of the Company not exceeding US$ 865 million (115% of the principal amount of the Notes).
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to Section 186 of the Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to Loans, Advances, Guarantees and Investments are provided as part of the financial statements.
II. BUSINESS AND OPERATIONS
Your Company is a global technology services firm, with employees in over 55 countries and serving enterprise clients across various industries. Your Companyâs business is
Pursuant to the approval of the Board on October 13, 2020 and approval of shareholders through special resolution dated November 16, 2020 passed through postal ballot by e-voting, your Company concluded the buyback of 237,500,000 equity shares of face value of '' 2/- each at a price of '' 400/- per equity share, for an aggregate amount of '' 95,000 million (excluding buyback tax), in January 2021.
The buyback was made from all existing shareholders of the Company as on December 1 1,2020, being the record date for the purpose, on a proportionate basis under the tender offer route in accordance with the provisions of the Securities and Exchange Board of India (Buyback of Securities) Regulations, 2018 and the Companies Act, 2013 and rules made thereunder.
Appropriations to general reserves for the financial year ended March 31, 2021 as per standalone and consolidated financial statements were:
('' in millions) Standalone Consolidated
Net profit for the year 100,609 107,964*
Balance of Reserves at the 453,110 541,790
beginning of the year
Transfer to General Reserves - -
Balance of Reserves at the end of 44 53852
the year
* excluding non-controlling interest
For complete details on movement in Reserves and Surplus during the financial year ended March 31, 2021, please refer to the Statement of Changes in Equity included in the Standalone and Consolidated financial statements on page nos. 156 to 157 and 229 to 230 respectively of this Annual Report.
During the financial year 2020-21, the Company allotted 3,281,165 equity shares consequent to exercise of employee stock options. Your Company also extinguished 237,500,000 equity shares consequent to buyback in January 2021 and reduced the paid-up equity share capital by '' 475 million. Consequently, the paid-up equity share capital of the Company as of March 31, 2021 stood at '' 10,958 million consisting of 5,479,138,555 equity shares of '' 2/- each.
In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is
comprised of the IT Services, IT Products and ISRE segments. Companies are transforming their technology stack, to operate with agility and flexibility. Your Company is a trusted partner to its clients in their transformation journey and enable them to be leaders in their respective industries.
During the year ended March 31,2021, your Company adopted a new organizational structure designed to simplify its go-to-market execution and ensure sector focus and growth in non-US markets. The previous structure of multiple delivery units has been replaced by a simplified model designed to bring the best of Wipro closer to its customers. This model consists of four Strategic Market Units (âSMUsâ) and two Global Business Lines (âGBLsâ). The four SMUs are Americas 1, Americas 2, Europe, and Asia Pacific Middle East Africa (âAPMEAâ).
Your Company organizes its customer-facing functions of sales, marketing and business development into teams that focus primarily on the four SMUs and service offerings, enabling it to deliver services to customers based on deep domain insight. Your Companyâs customer-facing functions in each SMU are predominantly locally staffed.
Your Company is seeing that traditional technology services are under stress and âshift to the newâ is becoming more pronounced. Growth in the technology services sector will be led by next generation technologies and services, such as digital, cloud, data, engineering and cybersecurity. Companies are actively exploring opportunities for digitization, leading to increased demand for consulting services. Digital technologies are expected to grow 15%-20% over the next five years and next-generation technologies such as 5G, Al/Intelligent Enterprise, robotics and blockchain, is anticipated to grow exponentially in the near future.
Your Company assist its clients to create new possibilities at the intersection of design, domain, consulting and next-generation technologies. Your Companyâs new operating model ensures adequate sector and domain-focused go-to-market and execution. It also combines global expertise with local geography-focus in building capabilities, and ensures dedicated sales presence, led by proximity to clients. Your Company is creating value for clients through sector focused business solutions, digital and technology capabilities, cutting edge innovation, leveraging strategic partnerships and talent.
Your Companyâs IT Services segment provides a range of IT and IT-enabled services which include digital strategy advisory, customer-centric design, technology consulting, IT consulting, custom application design, development, re-engineering and maintenance, systems integration, package implementation, global infrastructure services, analytics services, business process services, research and development and hardware and software design to leading enterprises worldwide.
Your Companyâs IT Products segment provides a range of third-party IT products, which allows us to offer comprehensive IT system integration services. These products include computing, platforms and storage, networking solutions, enterprise information security and software products, including databases and operating systems. Your Company provides IT products as a complement to its IT services offerings rather than sell standalone IT products, and its focus continues to be on consulting and digital engagements, with a more selective approach in bidding for System Integration (âSIâ) engagements.
Further information on your Companyâs IT services and products offerings, business strategy, operating segments overview and business model are presented as part of the Management Discussion and Analysis Report (âMD & A Reportâ) from page no. 30 onwards.
The ongoing global COVID-19 pandemic has caused and continues to cause significant loss of life and has resulted in curtailment of economic activities across the world as local administrations and governments seek to limit spread of the disease, including through lockdown policies, restriction on business activities and business shutdowns. Among other things, many of your Companyâs and its clientsâ offices have been closed and employees have been working from home and many customer-facing businesses have closed or are operating at a significantly lower capacity to observe various social distancing requirements and government-mandated COVID-19 protocols.
During the COVID-19 pandemic, your Company continued to sign large deals and deliver large-scale transformation projects.
In March 2020, at the onset of the COVID-19 pandemic, your Company enabled its employees globally to work from home. Since then, fewer than 3% of employees have been working from Companyâs offices.
Additional information regarding potential impact of COVID-19 pandemic on your Companyâs business operations and financial position are provided as part of the MD & A Report from page no. 30 onwards.
Global IT service providers offer a range of end-to-end software development, digital services, IT business solutions, research and development services, technology infrastructure services, business process services, consulting and related support functions.
According to the Future of technology Services- Winning in this Decade published by NASSCOM, Indian technologies services industry is forecasted to grow 10%-12% CAGR in 5 years to reach $300-$350B revenues.
According to the Future of technology Services- Winning in this Decade published by NASSCOM, share of digital in Indian technology services revenue is likely to be 55%-60% by 2025 with an annual growth of 25%-30%.
Acquisitions are a key enabler for driving capability to build industry domain, focus on key strategic areas, strengthening presence in emerging technology areas including Digital, and increase market footprint in newer markets. Your Company focuses on opportunities where it can further develop its domain expertise, specific skill sets and its global delivery model to maximize service and product enhancements and higher margins.
a) In August 2020, your Company acquired 4C NV and its subsidiaries, a Salesforce multi-cloud partner in Europe, U.K., and the Middle East.
b) In August 2020, your Company also acquired IVIA Servicos de Informatica Ltda., a specialized IT services provider to financial services, retail and manufacturing sectors in Brazil.
c) In December 2020, as part of strategic digital and IT partnership deal, your Company entered into a definitive agreement with Metro AG, the leading global wholesale company that is redefining the food service distribution industry. Duration of the deal is for 5 years with the intention to extend it up to additional 4 years. As part of this transaction, your Company had taken over the IT units of Metro AG, namely METRO-NOM GMBH and METRO Systems Romania S.R.L. effective April 1,2021.
d) In December 2020, your Company acquired 83.4% stake in Encore Theme Technologies Private Limited, a Finastra trade finance solutions partner across the Middle East, Africa, India and Asia Pacific. The remaining 16.6% equity stake will be acquired subject to and after receipt of certain regulatory approvals/confirmations.
e) In February 2021, your Company acquired Eximius Design, LLC and Eximius Design India Private Limited, a leading engineering services company with expertise in semiconductor, software and systems design.
f) In April 2021, your Company announced that it has signed definitive agreement to acquire Ampion, an Australia-based provider of cyber security, DevOps and quality engineering services. The transaction is expected to be completed during the quarter ending June 30, 2021, subject to customary closing conditions and regulatory approvals.
g) In April 2021, your Company acquired Capco, a global management and technology consultancy providing digital, consulting and technology services to financial institutions in the Americas, Europe and the Asia Pacific.
h) Wipro Ventures, the strategic investment arm of Wipro, invests in early-to-mid-stage enterprise software startups. The areas of investment include Artificial Intelligence, Analytics, Business Automation, Cloud Infrastructure, Cyber security, Data Management, Internet of Things and Testing Automation. As of March 31, 2021, Wipro Ventures manages 16 active investments. In addition to direct equity investments in emerging startups, Wipro Ventures has invested in five enterprise-focused venture funds: B Capital, Boldstart Ventures, Glilot Capital Partners, TLV Partners and Work-Bench.
i) During the financial year 2020-21, your Company has carried out the merger of Cellent GmbH, Germany with and into Wipro Technologies GmbH, Germany.
In terms of Regulation 34 of the Listing Regulations and SEBI circular SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (âIIRCâ) as part of its MD & A Report. The MD & A report, capturing your Companyâs performance, industry trends and other material changes with respect to your Companyâs and its subsidiaries, wherever applicable, are presented from page no. 30 onwards of this Annual Report.
The MD & A Report provides a consolidated perspective of economic, social and environmental aspects material to your Companyâs strategy and its ability to create and sustain value to its key stakeholders and includes aspects of reporting as required by Regulation 34 of the Listing Regulations on Business Responsibility Report. Statutory section of Business Responsibility Report is provided from page nos. 384 to 390 of this Annual Report.
Your Company believes in adopting best practices of corporate governance. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Companyâs code of business conduct, Corporate Governance Guidelines, charter of various sub-committees and disclosure policy.
As per Regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided at page no. 121 onwards.
Your Companyâs Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31,2021, the Board comprised of two Executive Directors, six non-executive Independent Directors and one non-executive non-independent Director.
Definition of âIndependenceâ of Directors is derived from Regulation 16 of the Listing Regulations, NYSE Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company has received necessary declarations under Section 149(7) of the Companies Act, 2013 and Regulation 25(8) of the Listing Regulations, from the Independent Directors stating that they meet the prescribed criteria for independence. The Board, after undertaking assessment and on examination of the relationships disclosed, considered the following Non-Executive Directors as Independent Directors:
Mr. M. K. Sharma
Mrs. Ireena Vittal
Mr. William Arthur Owens
Dr. Patrick J. Ennis
Mr. Patrick Dupuis
Mr. Deepak M. Satwalekar
All Independent Directors have affirmed compliance to the code of conduct for independent directors as prescribed in Schedule IV to the Companies Act, 2013.
The Board met six times during the financial year 2020-21 on April 15, 2020, May 29, 2020, July 14, 2020, October 12-13, 2020, January 13, 2021 and February 24, 2021. The necessary quorum was present for all the meetings. The maximum interval between any two meetings did not exceed 120 days.
At the 74th Annual General Meeting (AGM) held on July 13, 2020, the shareholders of the Company approved the following:
1. Appointment of Mr. Thierry Delaporte (DIN: 08107242) as the Chief Executive Officer and Managing Director of the Company for a period of 5 years from July 6, 2020
to July 5, 2025, whose office shall be liable to retire by rotation.
2. Appointment of Mr. Deepak M. Satwalekar (DIN: 00009627) as an Independent Director for a period of five years from July 1, 2020 to June 30, 2025, whose office shall not be liable to retire by rotation.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee, the Board approved re-appointment of Dr. Patrick J. Ennis (DIN: 07463299) and Mr. Patrick Dupuis (DIN: 07480046) as Independent Directors of the Company for a second term of 5 years with effect from April 1,2021 to March 31,2026, based on their skills, experience, knowledge and positive outcome of performance evaluation. The said re-appointment was approved by shareholders of the Company vide special resolutions dated June 4, 2021, passed through postal ballot by e-voting.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee, the Board has, on May 13, 2021, approved the appointment of Ms. Tulsi Naidu (DIN: 03017471) as an Additional Director in the capacity of Independent Director for a term of 5 years with effect from July 1,2021 to June 30, 2026, subject to approval of the shareholders of the Company. Necessary resolutions for her appointment are being placed for the approval of shareholders as part of the notice of the 75th AGM.
In the opinion of the Board, all our Independent Directors possess requisite qualifications, experience, expertise and hold high standards of integrity for the purpose of Rule 8(5)(iiia) of the Companies (Accounts) Rules, 2014. List of key skills, expertise and core competencies of the Board, including the Independent Directors, is provided at page no. 123 of this Annual Report.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Thierry Delaporte (DIN: 08107242) will retire by rotation at the 75th AGM and being eligible, has offered himself for re-appointment.
During the financial year, Mr. Abidali Z. Neemuchwala resigned as the Chief Executive Officer and Managing Director of the Company with effect from the end of the day on June 1, 2020. Further, Mrs. Arundhati Bhattacharya stepped down as an Independent Director from the Board with effect from close of business hours on June 30, 2020.
Your Companyâs Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as Risk Management Committee.
2. Board Governance, Nomination and Compensation
Committee, which also acts as Corporate Social Responsibility Committee.
3. Administrative and Shareholders/Investors Grievance Committee (Stakeholders Relationship Committee).
4. Strategy Committee.
At the Board Meeting held on April 15, 2021, it was decided to discontinue the Strategy Committee, as the entire Board will be deliberating matters pertaining to the strategy of the Company going forward.
Details of terms of reference of the Committees, Committee membership changes, and attendance of Directors at meetings of the Committees are provided in the Corporate Governance report from page nos. 128 to 132 of this Annual Report.
Board Evaluation
In line with the Corporate Governance Guidelines of the Company, Annual Performance Evaluation was conducted for all Board Members as well as the working of the Board and its Committees. This evaluation was led by the Chairman of the Board Governance, Nomination and Compensation Committee with specific focus on performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in accordance with the Guidance Note on Board Evaluation issued by SEBI in January 2017. The Board evaluation was conducted through questionnaire designed with qualitative parameters and feedback based on ratings.
Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance of Executive Directors, succession planning, strategic planning, etc.
Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience and expertise to provide feedback and guidance to top management on business strategy, governance, risk and understanding of the organizationâs strategy, etc.
The outcome of the Board Evaluation for the financial year 2020-21 was discussed by the Board Governance,
Nomination and Compensation Committee and the Board at their respective meetings held in April 2021. The Board has received highest ratings on Board communication and relationships, legal and financial duties of the Board and Composition and Role of the Board. The Board noted the actions taken in improving Board effectiveness based on feedback given in the previous year. Further, the Board also noted areas requiring more focus in the future, which includes further progress on Board diversity, Strategy especially post COVID-19, discussion on succession planning, and risk management.
The Board Governance, Nomination and Compensation Committee has framed a policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel (KMP), Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013.
Pursuant to Section 134(3) of the Companies Act, 2013, the nomination and remuneration policy of the Company which lays down the criteria for determining qualifications, competencies, positive attributes and independence for appointment of Directors and policies of the Company relating to remuneration of Directors, KMP and other employees is available on the Companyâs website at https://www.wipro.com/content/dam/nexus/en/investor/ corporate-governance/policies-and-guidelines/ethical-guidelines/wipro-limited-remuneration-policv.pdf. We affirm that the remuneration paid to Directors, senior management and other employees is in accordance with the remuneration policy of the Company.
The Board Governance, Nomination and Compensation Committee has framed a policy for Board Diversity which lays down the criteria for appointment of Directors on the Board of your Company and guides organizationâs approach to Board Diversity.
Your Company believes that, Board diversity basis the gender, race, age will help build diversity of thought and will set the tone at the top. A mix of individuals representing different geographies, culture, industry experience, qualification and skill set will bring in different perspectives and help the organization grow. The Board of Directors is responsible for review of the policy from time to time. Policy on Board Diversity has been placed on the Companyâs website at https://www.wipro.com/investors/corporate-governance/.
of leak or suspected leak of unpublished price sensitive information, and any conduct that results in violation of the Companyâs code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation or harassment of any kind against any employee who reports under the Vigil Mechanism or participates in the investigation.
Awareness of policies is created by, inter alia, sending group mailers highlighting actions taken by the Company against the errant employees. Mechanism followed under the Ombuds process has been displayed on the Companyâs intranet and website athttps://www.wipro.com/investors/ corporate-governance/#WiprosOmbudsProcess.
All complaints received through Ombuds process and investigative findings are reviewed and approved by the Chief Ombuds person. All employees and stakeholders can also register their concerns either by sending an email to [email protected]or through web-based portal at https://www.wipro.com/investors/corporate-governance/ #WiprosOmbudsProcess. Following an investigation of the concerns received, a decision is made by the appropriate authority on the action to be taken basis the findings of the investigation. In case the complainant is non-responsive for more than 15 days, the concern may be closed without further action.
The below table provides details of complaints received/ disposed during the financial year 2020-21:
No. of complaints pending at the beginning of financial year 85 No. of complaints filed during the financial year 870
No. of complaints disposed during the financial year 917
No. of complaints pending at the end of the financial year 38
All cases were investigated and actions taken as deemed appropriate. Based on self-disclosure data, 19% of these cases were reported anonymously. The top categories of complaints were people processes at 33% and workplace concerns and harassment at 28%. The majority of cases (76%) were resolved through engagement of human resources or mediation, or closed since they were unsubstantiated.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company were denied access to the Audit, Risk and Compliance Committee.
Information Required under Sexual Harassment of Women at Workplace (Prevention, Prohibition & Redressal) Act, 2013
Your Company has constituted Internal Complaints Committee under the Sexual Harassment of Women at
Your Company has put in place an Enterprise Risk Management (ERM) framework and adopted an enterprise risk management policy based on globally recognized standards. The ERM framework is administered by the Audit, Risk and Compliance Committee. The objective of the ERM framework is to enable and support achievement of business objectives through risk-intelligent assessment apart from placing significant focus on constantly identifying and mitigating risks within the business. The ERM framework covers various categories of risks including, inter alia, information security and cyber security risks, effectiveness of the controls that have been implemented to prevent such risks and continuous improvement of the systems and processes to mitigate such risks. For more details on the Companyâs risk management framework, please refer to page nos. 38 to 41 of this Annual Report.
The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances and provide update to the senior management and Board on a periodic basis. The Audit, Risk and Compliance Committee and the Board periodically monitor status of compliances with applicable laws.
Your Company has adopted a Code of Conduct to regulate, monitor and report trading by designated persons and their immediate relatives as per the requirements under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code for practices and procedures for fair disclosure of unpublished price sensitive information which has been made available on the Companyâs website at https://www.wipro.com/investors/corporate-governance/.
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013, Regulation 22 of the Listing Regulations and Regulation 9A of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.
Under this policy, your Company encourages its employees to report any incidence of fraudulent financial or other information to the stakeholders, reporting of instance(s)
Workplace (Prevention, Prohibition and Redressal) Act, 2013 and also has a policy and framework for employees to report sexual harassment cases at workplace. The Companyâs process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization. The below table provides details of complaints received/disposed during the financial year 2020-21.
No. of complaints disposed during the financial year 56
No. of complaints pending at the end of the financial year 14
As per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013, your Company follows calendar year for annual filling with statutory authority and as per the filing, a total of 36 complaints related to sexual harassment were raised in the calendar year 2020.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at armâs length as part of its philosophy of adhering to highest ethical standards, transparency and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. An abridged policy on related party transactions has been placed on the Companyâs website at https://www.wipro.com/ content/dam/nexus/en/investor/corporate-governance/ policies-and-guidelines/ethical-guidelines/abridged-policv-for-related-partv-transactions.pdf.
All related party transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for approval. Prior omnibus approval of the Audit, Risk and Compliance Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature.
The particulars of contracts or arrangements with related parties referred to in Section 188(1) and applicable rules of the Companies Act, 2013 in Form AOC-2 is provided as Annexure I to this Boardâs Report.
Details of transaction(s) of your Company with entity(ies) belonging to the promoter/promoter group which hold(s) more than 10% shareholding in the Company as required under para A of Schedule V of the Listing Regulations are provided as part of the financial statements.
Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed the reports on related party transactions with the Stock Exchanges.
Your Directors hereby confirm that:
a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d) the Directors have prepared the annual accounts on a going concern basis;
e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively;
f) adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Companyâs Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Your Company has instituted various employee stock options plans/restricted stock unit plans from time to time to motivate, incentivize and reward employees. The Board Governance, Nomination and Compensation Committee administers these plans. The stock option plans are in compliance with the Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014, as amended (âEmployee Benefits Regulationsâ) and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations read with the Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the
Companyâs website athttps://www.wipro.com/content/dam/ nexus/en/investor/annual-reports/2020-2021/disclosure-under-sebi-share-based-employee-benefits-regulations-2014-for-the-year-ended-march-31-2021.pdf. No employee was issued stock options during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
Particulars of Employees
Information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report.
A statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of '' 102 lakhs or more and, employees employed for part of the year and in receipt of remuneration of '' 8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure III to this report.
IV. INTERNAL FINANCIAL CONTROLS AND AUDIT Internal Financial Controls and their Adequacy
The Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
Statutory Audit
At the 71st AGM held on July 19, 2017, Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 1 17366W/W- 100018) was appointed as statutory auditors of the Company for a term of 5 years from the financial year 2017-18 onwards. Accordingly, Deloitte Haskins & Sells LLP will continue as statutory auditors of the Company till the financial year 2021-22.
There are no qualifications, reservations or adverse remarks made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report for the financial year ended March 31,2021.
Pursuant to provisions of the Section 143(12) of the Companies Act, 2013, neither the Statutory Auditors nor the Secretarial Auditor has reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V. Sreedharan, Partner, V. Sreedharan & Associates, a firm of Company Secretaries in Practice, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31,2021 is enclosed as Annexure IV to this Report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
Your Company is one of the most admired and recognized companies in the IT industry. Your Company has won several awards and accolades, out of which key recognitions are given below:
1. Wipro was included in the Dow Jones Sustainability Index (DJSI) - World and Emerging Markets for the 11th time in succession.
2. Wipro has been recognized as one of the Worldâs Most Ethical Companies for the 10th successive year by the Ethisphere Institute.
3. Wipro has received the award for âLeadershipâ category in corporate governance practices for the 4th consecutive year under corporate governance scorecard developed by BSE Limited (BSE), International Finance Corporation (IFC) and IiAS.
4. Wipro was positioned as a leader in Gartner''s Magic Quadrant for Data Center Outsourcing and Hybrid Infrastructure Managed Services, Asia Pacific.
5. Wipro has won the Data Estate Modernization 2020 Microsoft Partner of the Year Award.
6. Wipro was recognized as leader in Everest Group PEAK Matrix⢠for Healthcare Payer Operations Service Providers 2020.
7. Wipro has won the âOracle UK & Ireland Partner of the Year 2020â award in âCustomer Experienceâ category.
8. Wipro has won the Application Innovation 2020 Microsoft Partner of the Year Award for demonstrating excellence in innovation and implementation of customer solutions based on Microsoft technology.
9. Wipro was positioned as a Leader and Star Performer in Everest Group PEAK Matrix for Open Banking IT Service Providers 2020.
10. Wipro was positioned as a Leader in Everest Groupâs BFS Risk and Compliance IT Services PEAK Matrix Assessment 2020.
11. Wipro was positioned as a Leader in Gartnerâs Magic Quadrant for Data Center Outsourcing and Hybrid Infrastructure Managed Services, North America.
collaborate on emerging good practices in Covid care- the Global Coalition for COVID-19 Medical Care (GCCMC). The platform has been very active with a number of webinars and interactive sessions organized on COVID-19 control and vaccination.
Along with the integrated Covid response, your Company also continued to focus and support its regular programs in Education, Urban Ecology, Primary Health Care and Disaster Response. Your Companyâs partner network comprising nearly 200 committed organizations from across the country adapted very well to the changing dynamics on the ground and ensured continuity of work through a hybrid model that combined online intervention with some field work.
The contents of the CSR policy and revised format of CSR Report notified in the Companies (Corporate Social Responsibility Policy) Amendment Rules, 2021 dated January 22, 2021, is attached as Annexure V to this report. CSR policy is also available on the Companyâs website at https://www.wipro.com/content/dam/nexus/en/ investor/corporate-governance/policies-and-guidelines/ ethical-guidelines/1 2773-policy-on-corporate-social-responsibilitv.pdf.
The terms of reference of CSR committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Board Governance, Nomination and Compensation Committee.
The Committee consists of three Independent Directors, Mr. William Arthur Owens, Mr. M. K. Sharma and Mrs. lreena Vittal, as its members. Mr. William Arthur Owens is the Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its âSustainabilityâ initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD & A Report.
VII. DISCLOSURES
Foreign Exchange Earnings and Outgoings
During the year 2020-21, your Companyâs foreign exchange earnings were '' 463,447 million and foreign exchange outgoings were '' 213,295 million as against '' 460,794 million of foreign exchange earnings and '' 229,491 million of foreign exchange outgoings for the financial year 2019-20.
Annual Return
Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, the Company has placed a copy of the
12. Wipro has been positioned as a âLeaderâ in Gartnerâs 2020 Magic Quadrant for Public Cloud Infrastructure Professional and Managed Services, Worldwide.
Further details of awards and accolades won by your Company are provided at page no. 17 of this Annual Report.
Your Company is at the forefront of Corporate Social Responsibility (CSR) and sustainability initiatives and practices. Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. Your Company has been involved with social initiatives for more than a decade and half and engages in various activities in the field of education, healthcare and communities, ecology and environment, etc.
As per the provisions of the Companies Act, 2013, a company meeting the specified criteria shall spend at least 2% of its average net profits for three immediately preceding financial years towards CSR activities. Accordingly, your Company spent '' 2,512 million towards CSR activities during the financial year 2020-21.
In April 2020, your Company committed '' 1,000 million towards tackling the unprecedented health and humanitarian crisis arising from the COVID-19 pandemic outbreak and out of that an amount of '' 868 million was spent. Your Companyâs Covid response involved working closely with around 100 non-government organizations (NGOs) who were engaged directly on the ground in supporting affected communities. In the early stages of the pandemic (March-June), your Companyâs response was focused on humanitarian relief in cities that were severely affected and where it has significant operational presence-Bengaluru, Chennai, NCR, Mumbai, Kolkata and Hyderabad. In parallel, your Company along with Azim Premji Foundation developed and implemented a strategic response to the COVID-19 healthcare challenge that extended for most of the year. The response addressed in-depth the entire spectrum of issues from awareness creation to testing, isolation and hospital care.
There were three innovative projects your Company conceptualized and executed directly. These were: (i) the preparation and distribution of nearly 3 million cooked meals to more than 2.5 lakh people from the Wipro canteens in Bengaluru, Pune and Kolkata, (ii) Converting its Pune IT facility to a fully equipped and staffed 450 bed Covid hospital. The hospital has established a solid reputation with the surrounding communities and has seen nearly 5,500 admissions till date and (iii) Designing and running a digital platform for doctors and healthcare experts to exchange and
Annual Return as at March 31,2021 on its website at https:// www.wipro.com/content/dam/nexus/en/investor/annual-reports/2020-2021/draft-annual-return-2020-21 .pdf. By virtue of amendment to Section 92(3) of the Companies Act, 2013, the Company is not required to provide extract of Annual Return (Form MGT-9) as part of the Boardâs report.
Other Disclosures
a) Your Company has not accepted any deposits from the public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
b) Your Company has not issued shares with differential voting rights and sweat equity shares during the year under review.
c) Your Company has complied with the applicable Secretarial Standards relating to âMeetings of the Board of Directorsâ and âGeneral Meetingsâ during the year.
d) Maintenance of cost records and requirement of cost Audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable to the business activities carried out by the Company.
e) There are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.
f) Details of unclaimed dividends and equity shares transferred to the Investor Education and Protection Fund authority have been provided as part of the Corporate Governance report.
g) There are no proceedings initiated/pending against your Company under the Insolvency and Bankruptcy Code, 2016 which materially impact the business of the Company.
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of the Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence have ensured that the Company continues to be a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors,
Bengaluru Rishad A. Premji
June 9, 2021 Chairman
Mar 31, 2019
Boardâs Report
On behalf of the Board of Directors (the âBoardâ) of the Company, it gives me immense pleasure to present the 73rd Boardâs Report, along with the Balance Sheet, Profit and Loss account and Cash Flow statements, for the financial year ended March 31, 2019.
I. Financial Performance
The standalone and consolidated financial statements for the financial year ended March 31, 2019, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.
On a consolidated basis, our sales increased to Rs. 585,845 million for the current year as against Rs. 544,871 million in the previous year, recording an increase of 7.52%. Our net profits increased to Rs. 90,179 million for the current year as against Rs. 80,031 million in the previous year, recording an increase of 12.68%.
On a standalone basis, our sales increased to Rs. 480,298 million for the current year as against Rs. 447,100 million in the previous year, recording an increase of 7.43%. Our net profits declined to Rs. 76,140 million in the current year as against Rs. 77,228 million in the previous year, recording a decline of 1.41%.
Key highlights of financial performance of your Company for the financial year 2018-19 are provided below:
(Rs. in millions)
Standalone |
Consolidated |
|||
2018-19 |
2017-18 |
2018-19 |
2017-18 |
|
Sales |
480,298 |
447,100 |
585,845 |
544,871 |
Other Operating Income |
940 |
- |
4,344 |
- |
Other Income |
25,686 |
24,796 |
26,138 |
25,487 |
Profit before Tax |
98,705 |
100,343 |
115,422 |
102,422 |
Provision for Tax |
22,565 |
23,115 |
25,243 |
22,391 |
Net profit for the year |
76,140 |
77,228 |
90,179 |
80,031 |
Other comprehensive (loss)/income for the year |
1,246 |
(7,300) |
800 |
(3,127) |
Total comprehensive income for the year Total comprehensive income for the period attributable to: |
77,386 |
69,928 |
90,979 |
76,094 |
Minority Interest |
- |
- |
251 |
19 |
Equity holders |
77,386 |
69,928 |
90,728 |
76,885 |
Standalone |
Consolidated |
|||
2018-19 |
2017-18 |
2018-19 |
2017-18 |
|
Appropriations |
||||
Dividend |
4,524 |
4,525 |
4,504 |
4,499 |
Corporate tax on |
930 |
921 |
930 |
921 |
distribution of dividend |
||||
EPS |
||||
- Basic |
12.67 |
16.26 |
14.99 |
16.85 |
- Diluted |
12.64 |
16.23 |
14.95 |
16.82 |
Dividend
Pursuant to Regulation 43A of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, as amended (âListing Regulationsâ), the Board has approved and adopted a Dividend Distribution Policy. The policy details various considerations based on which the Board may recommend or declare Dividend, dividend track record, usage of retained earnings for corporate actions, etc. The policy is available on the Companyâs website at https://www.wipro. com/investors/corporate-governance.
Pursuant to the approval of the Board of Directors on January 18, 2019, your Company paid an interim dividend of Rs. 1/- per equity share of face value of Rs. 2/- each, to shareholders who were on the register of members as on January 30, 2019, being the record date fixed for this purpose. The Board has not recommended a final dividend and the interim dividend of Rs. 1/- declared by the Board in January 2019 shall be considered as the final dividend for the financial year 2018-19. Thus, the total dividend for the financial year 2018-19 remains Rs. 1 per equity share.
Your Company is in compliance with its Dividend Distribution policy as approved by the Board.
Issue of Bonus Equity Shares
The Board of Directors at their meeting held on January 18, 2019, recommended issue of bonus equity shares, in the proportion of 1:3, i.e. 1 (One) bonus equity share of Rs. 2/- each for every 3 (three) fully paid-up equity shares held (including American Depository Shares (âADSâ)). The said bonus issue was approved by the Members of the Company vide resolution dated February 22, 2019 passed through postal ballot/e-voting, subsequent to which, on March 8, 2019, 1,508,469,180 bonus shares were allotted to the Members whose names appeared on the register of members as on March 7, 2019, being the record date fixed for this purpose.
As part of the aforesaid allotment, 106,273 bonus equity shares representing fractional entitlement(s) of eligible Members were consolidated and allotted to the trustee appointed by the Board. Subsequently, the trustee sold such equity shares at the prevailing market price and distributed the net sale proceeds, after adjusting the costs and expenses in respect thereof, among the eligible Members in proportion to their respective fractional entitlements.
Buyback of Equity Shares
On April 16, 2019, the Board approved a proposal to buyback up to 323,076,923 (Thirty Two Crores Thirty Lakhs Seventy Six Thousand Nine Hundred and Twenty Three) equity shares of the Company for an aggregate amount not exceeding Rs. 105,000,000,000/- (Rupees Ten Thousand Five Hundred Crores only), being 23.03% of the aggregate of the fully paid-up equity share capital and free reserves as per the audited standalone balance sheet as at March 31, 2019, at a price of Rs. 325/- (Rupees Three Hundred and Twenty Five) per equity share.
Subsequently, vide resolution dated June 1, 2019, the shareholders approved the buyback of equity shares through postal ballot/e-voting. The buyback is proposed to be made from all the existing Members of the Company as on June 21, 2019, being the record date for this purpose, on a proportionate basis under the tender offer route in accordance with the provisions contained in the Securities and Exchange Board of India (Buy-Back of Securities) Regulations, 2018 and the Companies Act, 2013 and the rules made thereunder.
Share Capital
During the financial year 2018-19, your Companyâs authorized capital was increased from Rs. 11,265,000,000/- (Rupees One Thousand One Hundred and Twenty Six Crores and Fifty Lakhs) to Rs. 25,274,000,000 /- (Rupees Two Thousand Five Hundred and Twenty Seven Crores and Forty Lakhs) by creation of additional 7,004,500,000 (Seven Hundred Crores and Forty Five Lakhs) equity shares of Rs. 2/- (Rupees Two each). The said increase in authorized share capital was pursuant to approval of shareholders through postal ballot/e-voting dated February 22, 2019 and also as per the terms of the Scheme (as defined below) approved by the Honâble National Company Law Tribunal (âNCLTâ), Bengaluru Bench, on account of clubbing the authorized share capital of Appirio India Cloud Solutions Private Limited with and into the authorized capital of your Company.
During the year 2018-19, the Company allotted 1,681,717 equity shares and transferred 2,599,183 equity shares of Rs. 2/- each from Wipro Equity Reward Trust, pursuant to exercise of stock options by eligible employees and allotted 1,508,469,180 equity shares of Rs. 2/- each as bonus equity shares on March 8, 2019 by capitalization of sums standing to the credit of the free reserves and/or the securities premium account and/or the capital redemption reserve account of the Company. Consequently, the paid-up equity share capital of the Company as at March 31, 2019 stood at Rs. 12,067,870,776/- consisting of 6,033,935,388 equity shares of Rs. 2/- each.
During the year under review, the Company has not issued shares with differential voting rights and sweat equity shares.
Transfer to Reserves
Appropriations to general reserve for the financial year ended March 31, 2019 as per standalone and consolidated financial statements are as under:
(Rs. In millions)
Standalone |
Consolidated |
|
Net profit for the year |
76,140 |
90,037 |
Balance of Reserve at the beginning of the year |
413,578 |
470,215 |
Adjustment on adoption of Ind AS 115 |
(1,605) |
(2,279) |
Adjustment on account of merger |
(975) |
- |
Transfer to General Reserve |
- |
- |
Balance of Reserve at the end of the year |
481,852 |
552,158 |
Subsidiary Companies
In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided at page 285 of this Annual Report. The statement also provides details of performance and financial position of each of the subsidiaries.
Audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at www.wipro.com.
During the financial year 2018-19, your Company invested an aggregate of Rs. 36,373 million in its direct subsidiaries. Apart from this, your Company funded its subsidiaries, from time to time, as per the fund requirements, through loans, guarantees and other means to meet working capital requirements.
During the financial year 2018-19, your Company has carried out restructuring of its following subsidiaries:
a) Merger of Wipro Technologies Austria GmbH, Wipro Information Technology Austria GmbH, NewLogic Technologies SARL and Appirio India Cloud Solutions Private Limited (wholly owned subsidiaries) with and into Wipro Limited pursuant to order dated March 29, 2019 passed by NCLT approving the scheme of amalgamation (âSchemeâ) for the aforesaid merger. As per the said Scheme, the appointed date is April 1, 2018.
b) Liquidation of Appirio Singapore Pte Ltd and Appirio GmbH.
c) Merger of Cellent Mittelstandsberatung GmbH with and into Cellent GmbH, Germany.
d) Reduction of the Companyâs equity holding in WAISL Limited (formerly known as Wipro Airport IT Services Limited), which was a joint venture between Wipro Limited and Delhi International Airport Limited, from 74% to 11%, by selling the stake to Antariksh Softtech Private Limited on April 5, 2018.
e) Setting up of a new subsidiary namely Wipro IT Services S.R.L in Romania.
f) Setting up of a new subsidiary namely Wipro US Foundation in USA.
Transfer to Investor Education and Protection Fund
a) As required under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (âIEPF Rulesâ), during the year 2018-19, unclaimed dividend for financial years 2010-11 and 2011-12 of Rs. 7,929,792/- and Rs. 4,714,164/- respectively, were transferred to the Investor Education and Protection Fund (âIEPFâ).
b) Pursuant to the provisions of Section 124(6) of the Companies Act, 2013 and the IEPF Rules, during the year 2018-19, 60,958 equity shares in respect of which dividend has not been claimed for the final dividend declared in financial year 2010-11 and interim dividend declared in financial year 2011-12 were transferred to the IEPF authority.
c) Pursuant to Rule 6(8) of the IEPF Rules, under the bonus issue, 426,445 equity shares were allotted to the IEPF authority based on their shareholding as on the record date of March 7, 2019 and an amount of Rs. 102,485 /- pertaining to sale proceeds of fractional bonus shares were transferred to the IEPF.
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to Section 186 of Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to loans, advances, guarantees and investments are provided as part of the financial statements.
Deposits
Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
II. Business
Your Company is a leading information technology, consulting and business process services company. Your Companyâs range of services includes digital strategy, customer-centric design, consulting, infrastructure services, business process services, research and development, cloud, mobility and advanced analytics and product engineering. Your Company offers its customers a variety of commercial models including time and material, fixed price, capacity based, pay-per-use, as-a-service and outcome based models. Your Company offers all of these services and models globally by leveraging its proprietary products, platforms, partnerships and solutions, including state of the art automation technologies such as cognitive intelligence tool, Wipro HOLMES Artificial Intelligence Platform⢠(âWipro HOLMESâ¢â).
The vision for your Companyâs business is âto earn our clientsâ trust and maximize value of their businesses by helping them in their journey to âre-inventâ their business and operating models with its âDigitalâ first approach and best in class executionâ. To realize its vision and strategy, your Company is prioritizing and investing to drive growth in key strategic fields such as digital, cloud, cybersecurity and industrial and engineering services through its âBig Betâ program. For example, your Companyâs âBig Betâ in each of digital and cloud are at the heart of its Business Re-imagination and Engineering Transformation and Modernization pillars, while the âBig Betâ in industrial and engineering services is central to its Connected Intelligence pillar and the âBig Betâ in cyber security is central to its Trust pillar.
Your Company provides its clients with competitive advantages by applying various emerging technologies and ensuring cyber resilience and cyber assurance. Your Company works with its clients not only to enable their digital future, but also to drive hyper efficiencies across their technology infrastructure, applications and core operations, enabling them to achieve cost leadership in their businesses. Going forward, digital enterprises will increasingly require partners, such as Wipro, who are able to bring capabilities that span consultancy, design, engineering, systems integration and operations to enable them to achieve digital transformation. These combined capabilities will only be effective if delivered in the context of the relevant industry or domain. Hence, it is critical to your Company that it provides strong domain expertise along with âDigitalâ. Your Company has invested significantly in building domain expertise and will continue to strengthen its domain capabilities.
Your Companyâs IT Products segment provides a range of third-party IT products, which allows it to offer comprehensive IT system integration services. These products include computing, platforms and storage, networking solutions, enterprise information security and software products, including databases and operating systems. Your Company continues to focus on being a system integrator of choice where it provides IT Products as a complement to its IT Services offerings rather than sell standalone IT Products.
Sector Outlook
According to the Strategic Review 2019 published by NASSCOM (the âNASSCOM Reportâ), âDigitalâ continues to drive growth (more than 30% of growth in fiscal year 2019) and now contributes $33 billion to the overall IT industry in India. Technologies such as industrial automation, robotics, cloud, Internet of things (âIoTâ), augmented reality (âARâ)/virtual reality (âVRâ) and blockchain continue to fuel growth.
Global IT service providers offer a range of end-to-end software development, digital services, IT business solutions, research and development services, technology infrastructure services, business process services, consulting and related support functions. According to the NASSCOM Report, IT export revenues from India grew by 8.3% to an estimated $136 billion in fiscal year 2019.
Acquisitions, Divestments and Investments
Acquisitions are a key enabler for driving capability to build industry domain, focus on key strategic areas, strengthen presence in emerging technology areas including Digital, and increase market footprint in newer markets. Your Company focuses on opportunities where it can further develop its domain expertise, specific skill sets and its global delivery model to maximize service and product enhancements and higher margins.
During July 2018, your Company has entered into a strategic partnership arrangement with Alight Solutions, a leader in technology-enabled health, wealth, HR and finance solutions, which will reshape the HR services industry by providing Alightâs clients with the breadth and depth of capabilities from the two industry-leading organizations. Your Company has also divested its Workday and Cornerstone OnDemand business to Alight Solutions LLC.
Further, your Company completed divestment of its data center services business to Ensono Holdings, LLC, a leading hybrid IT services provider, consisting of Wipro Data Centre and Cloud Services, Inc. (USA) and data center services business in certain other countries.
The strategic investment arm of your Company, Wipro Ventures is a $100 million fund that invests in early to midstage enterprise software startups. As of March 31, 2019, Wipro Ventures has active investments in and partnered with 13 startups in the following areas - AI (Avaamo, Inc., Vicarious FPC, Inc.), Business Commerce (Tradeshift, Inc.), Cybersecurity (IntSights Cyber Intelligence Ltd., Vectra Networks, Inc., CyCognito), Data Management (Imanis Data, Inc.), Industrial IoT (Altizon Systems Private Ltd.), Fraud & Risk Mitigation (Emailage Corp.), Testing Automation (Headspin, Inc., Tricentis GmbH) and Cloud Infrastructure (Cloudgenix, Moogsoft). In addition to direct investments in emerging startups, Wipro Ventures had invested in four enterprise-focused venture funds: TLV Partners, WorkBench Ventures, Glilot Capital Partners and Boldstart Ventures. During the year ended March 31, 2019, one of our portfolio companies, Demisto, was acquired.
Management Discussion and Analysis Report
In terms of Regulation 34 of the Listing Regulations and SEBI circular SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (âIIRCâ) as part of its Management Discussion and Analysis report (âMD&A Reportâ). The MD&A report, capturing your Companyâs performance, industry trends and other material changes with respect to your Company and its subsidiaries, wherever applicable, are presented from pages 18 to 64 of this Annual Report.
The MD&A Report provides a consolidated perspective of economic, social and environmental aspects material to its strategy and its ability to create and sustain value to your Companyâs key stakeholders and includes aspects of reporting as required by Regulation 34 of the Listing Regulations on Business Responsibility Report. Statutory section of Business Responsibility Report is provided from pages 346 to 352 of this Annual Report.
Key Awards and Recognitions
Your Company is one of the most admired and recognized companies in the IT industry. Your Company won several awards and accolades, out of which key recognitions are given below:
1. Wipro was ranked as the third fastest growing global IT Services brand in 2019 in a study conducted by Brand Finance, the worldâs leading brand valuation firm.
2. Wipro received âQuality Global Supplierâ award from innogy SE.
3. Wipro was rated a Leader in Digital Transformation in ITSMA Report.
4. Wipro has been recognized as a Leader in Digital Process Automation by Independent Research Firm.
5. Wipro was included in the Dow Jones Sustainability Index (DJSI) - World and Emerging Markets for the 9th time in succession.
6. Wipro has been cited as a Leader in Everest Groupâs Digital Workplace Services PEAK Matrix assessment.
7. Wiproâs Intellectual Property Portfolio was Recognized with National IP Award and WIPO Enterprise IP Trophy.
8. Wipro was cited as a Leader in Gartnerâs Magic Quadrant for Data Center Outsourcing and Hybrid Infrastructure Managed Services, North America.
9. Wipro has been recognized for second successive year in the âLeadershipâ category for corporate governance practices on the basis of the Indian Corporate Governance Scorecard, which is a framework developed jointly by International Finance Corporation, a member of the World Bank group, BSE Limited and Institutional Investor Advisory Services based on globally accepted G20/OECD principles.
Further details of awards and accolades won by your Company are provided at page 11 of this Annual Report.
III. Governance and Ethics
Corporate Governance
Your Company believes in adopting best practices of corporate governance. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Companyâs code of business conduct, Corporate Governance Guidelines, charter of various sub-committees and disclosure policy.
As per Regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Practising Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided in page 115 of this Annual Report.
Board of Directors
Board Composition and Independence
Your Companyâs Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31, 2019, the Board comprised of three Executive Directors and eight Non-Executive Independent Directors.
Definition of âIndependenceâ of Directors is derived from Regulation 16 of the Listing Regulations, the NYSE Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company has received necessary declarations under Section 149(7) of the Companies Act, 2013, from the Independent Directors stating that they meet the prescribed criteria for independence. The Board of Directors, after undertaking assessment and on evaluation of the relationships disclosed, considered the following Non-Executive Directors as Independent Directors:
a) Mr. N Vaghul
b) Dr. Ashok S Ganguly
c) Mr. M K Sharma
d) Mrs. Ireena Vittal
e) Mr. William Arthur Owens
f) Dr. Patrick J Ennis
g) Mr. Patrick Dupuis
h) Mrs. Arundhati Bhattacharya
All Independent Directors have affirmed compliance to the code of conduct for independent directors as prescribed in Schedule IV of the Companies Act, 2013.
Number of Meetings of the Board
The Board met five times during the financial year 2018-19 on April 24-25, 2018, June 8, 2018, July 19-20, 2018,October 23-24, 2018 and January 17-18,2019.The maximum interval between any two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
At the 72nd Annual General Meeting (AGM) held on July 19, 2018, Mrs. Ireena Vittal was re-appointed as an Independent Director for a second term with effect from October 1, 2018 to September 30, 2023.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee, and subject to approval of the Members of the Company, the Board at its meeting held on October 24, 2018, approved appointment of Mrs. Arundhati Bhattacharya as Additional Director, designated as Independent Director of the Company for a term of 5 years from January 1, 2019 to December 31, 2023. Further, the shareholders of the Company approved the aforesaid appointment vide resolution passed by way of postal ballot/e-voting dated June 1, 2019.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mr. Abidali Z Neemuchwala will retire by rotation at the 73rd AGM and being eligible, has offered himself for re-appointment.
The Board of Directors of the Company, at their meeting held on June 6, 2019, approved the following, subject to approval of the Members:
1. Appointment of Mr. Azim H Premji as Non-Executive Director for a period of 5 years with effect from July 31, 2019 to July 30, 2024 and conferred him with the title of Founder Chairman of the Company. Mr. Azim H Premji will retire from his current position as Executive Chairman and Managing Director effective July 30, 2019.
2. Re-appointment of Mr. Rishad A Premji as Whole Time Director for a period of 5 years with effect from July 31, 2019 to July 30, 2024 (designated as Executive Chairman by the Board of Directors of the Company).
As and when the amendments to Regulation 17(1B) of the Listing Regulations requiring appointment of Non-Executive Chairman by listed entities come into effect, Mr. Rishad A Premji will cease to perform any executive roles in the Company and continue in the capacity of Non-Executive Director (designated as âNon-Executive Chairmanâ by the Board of Directors) of the Company, such that the Company remains compliant with the Listing Regulations in force at all times.
3. Designated and appointed Mr. Abidali Z Neemuchwala as Managing Director of the Company with effect from July 31, 2019 till the end of his current term, in addition to his existing position as Chief Executive Officer of the Company.
Committees of the Board
The Companyâs Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as Risk Management Committee.
2. Board Governance, Nomination and Compensation Committee, which also acts as Corporate Social Responsibility Committee.
3. Strategy Committee.
4. Administrative and Shareholders/Investors Grievance Committee (Stakeholdersâ Relationship Committee).
Details of terms of reference of the Committees, Committee membership and attendance of Directors at meetings of the Committees are provided in the Corporate Governance report from pages 122 to 125 of this Annual Report.
Board Evaluation
In line with the Corporate Governance Guidelines of your Company, Annual Performance Evaluation was conducted for all Board Members, for the Board and its Committees. This evaluation was led by the Chairman of the Board Governance, Nomination and Compensation Committee with specific focus on performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in accordance with the Guidance Note on Board Evaluation issued by SEBI in January 2017. The Board evaluation was conducted through questionnaire designed with qualitative parameters and feedback based on ratings.
Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance of Executive Directors, succession planning, strategic planning, etc.
Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience and expertise to provide feedback and guidance to top management on business strategy, governance, risk and understanding of the organizationâs strategy, etc.
The outcome of the Board evaluation for financial year 2018-19 was discussed by the Board Governance, Nomination and Compensation Committee and the Board at their meeting held in April 2019. The Board has received highest ratings on Board communication and relationships, functioning of Board Committees and legal and financial duties. The Board noted the actions taken in improving Board effectiveness based on feedback given in the previous year. Further, the Board also noted areas requiring more focus in the future, which include spending more time on trends, long-term threats and opportunities.
Policy on Directorâs Appointment and Remuneration
The Board Governance, Nomination & Compensation Committee has framed a policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel (KMP), senior management personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013.
Pursuant to Section 134(3) of the Companies Act, 2013, the nomination and remuneration policy of the Company which lays down the criteria for determining qualifications, competencies, positive attributes and independence for appointment of Directors and policies of the Company relating to remuneration of Directors, KMP and other employees is available on the Companyâs website at https://www.wipro.com/content/dam/nexus/en/investor/ corporate-governance/policies-and-guidelines/ethical-guidelines/wipro-limited-remuneration-policy.pdf. We affirm that the remuneration paid to Directors is in accordance with the remuneration policy of the Company.
Risk Management
Your Company has put in place an Enterprise Risk Management (ERM) framework and adopted an enterprise risk management policy based on globally recognized standards. The ERM framework is administered by the Audit, Risk and Compliance Committee. The objective of the ERM framework is to enable and support achievement of business objectives through risk-intelligent assessment apart from placing significant focus on constantly identifying and mitigating risks within the business. The ERM Framework covers various categories of risks including, inter alia, information security and cyber security risks, effectiveness of the controls that have been implemented to prevent such risks and continuous improvement of the systems and processes to mitigate such risks.
For more details on the Companyâs risk management framework, please refer page 27 of this Annual Report.
Compliance Management Framework
The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances and provide update to senior management and Board on a periodic basis. The Audit, Risk and Compliance Committee and the Board periodically monitor status of compliances with applicable laws.
Code for Prevention of Insider Trading
On December 31, 2018, Securities and Exchange Board of India amended the Prohibition of Insider Trading Regulations, 2015, prescribing various new requirements with effect from April 1, 2019. In line with the amendments, your Company has adopted an amended Code of Conduct to regulate, monitor and report trading by Designated Persons and their Immediate Relatives under the Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015. This Code of Conduct also includes code of practices and procedures for fair disclosure of unpublished price sensitive information which has been made available on the Companyâs website at https://www.wipro.com/corporate-governance.
Vigil Mechanism
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and Directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013 and Regulation 22 of the Listing Regulations. The Ombuds policy of the Company was amended to align with the requirements under Regulation 9A of Securities and Exchange Board of India (Prohibition of Insider Trading) Regulations, 2015.
Under this policy, your Company encourages its employees to report any reporting of fraudulent financial or other information to the stakeholders, and any conduct that results in violation of the Companyâs code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation or harassment of any kind against any employees who report under the Vigil Mechanism or participates in the investigation.
Awareness of policies is created by sending group mailers highlighting actions taken by the Company against the errant employees. Mechanism followed under Ombuds process has been displayed on the Companyâs intranet and website at www.wipro.com.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company was denied access to the Audit, Risk & Compliance Committee.
Information Required under Sexual Harassment of Women at Work place (Prevention, Prohibition and Redressal) Act, 2013
Your Company has constituted Internal Complaints Committee as per the Sexual Harassment of Women at Workplace (Prevention, Prohibition and Redressal) Act, 2013 and also has a policy and framework for employees to report sexual harassment cases at workplace and its process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization.
Details of complaints received/disposed during the financial year 2018-19 is provided on page 126 of this Annual Report.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at armâs length as part of its philosophy of adhering to highest ethical standards, transparency and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. An abridged policy on related party transactions has been placed on the Companyâs website https://www.wipro.com/corporate-governance.
All related party transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for approval. Prior omnibus approval of the Audit, Risk and Compliance Committee and the Board is obtained for the transactions which are foreseeable and of a repetitive nature.
The particulars of contracts or arrangements with related parties referred to in Section 188(1) and applicable rules of the Companies Act, 2013 in Form AOC-2 is provided as Annexure I to this Annual Report.
Pursuant to Regulation 23(9) of the Listing Regulations, your Company has filed half yearly report on Related Party Transactions with the Stock Exchanges, for the year ended March 31, 2019.
Directorsâ Responsibility Statement
Your Directors hereby confirm that:
(a) in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) the Directors have prepared the annual accounts on a going concern basis;
(e) the Directors have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively; and
(f) as required under Section 134(5)(f) of the Companies Act, 2013, and according to the information and explanations presented to us, based on the review done by the Audit, Risk and Compliance Committee and as recommended by it, we, the Board, hereby, state that adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Companyâs Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Wipro Employee Stock Option Plans (WESOP)/Restricted Stock Unit Plans
Your Company has instituted various employee stock options plans/restricted stock unit plans from time to time to motivate, incentivize and reward employees. The Board Governance, Nomination and Compensation Committee administers these plans. The stock option plans are in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (âEmployee Benefits Regulationsâ) and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations read with Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Companyâs website at https://www.wipro.com/investors/ annual-reports/. No employee was issued stock options during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
Particulars of Employees
Information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report.
A statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of Rs. 102 lakhs or more and, employees employed for part of the year and in receipt of remuneration of Rs. 8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure III to this report.
IV. Internal Financial Controls and Audit
Internal Financial Controls and their Adequacy
The Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
Statutory Auditors
At the 71st AGM held on July 19, 2017, the Members of the Company approved the appointment of Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 117366W/W-100018) as statutory auditors of the Company for a term of 5 years from the financial year 2017-18 onwards on such terms and conditions and remuneration as may be decided by the Audit, Risk and Compliance Committee. Accordingly, Deloitte Haskins & Sells LLP will continue as statutory auditors of the Company till the financial year 2021- 22.
Vide notification dated May 7, 2018 issued by Ministry of Corporate Affairs, the requirement of seeking ratification of appointment of statutory auditors by members at each AGM has been done away with. Accordingly, no such item has been considered in notice of the 73rd AGM.
Auditorsâ Report
There are no qualifications, reservations or adverse remarks made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report for the financial year ended March 31, 2019.
Pursuant to provisions of Section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V Sreedharan, Partner, V Sreedharan & Associates, Practicing Company Secretaries, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31, 2019 is enclosed as Annexure IV to this report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
Cost Records and Audit
Maintenance of cost records and requirement of cost audit as prescribed under the provisions of Section 148(1) of the Companies Act, 2013 are not applicable for the business activities carried out by the Company.
V. Social Responsibility and Sustainability
Corporate Social Responsibility
Your Company is at the forefront of Corporate Social Responsibility (CSR) and sustainability initiatives and practices. Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. Your Company has been involved with social initiatives for more than a decade and half and engages in various activities in the field of education, primary healthcare and communities, ecology and environment, etc. Your Company has won several awards and accolades for its CSR and sustainability efforts.
As per the provisions of the Companies Act, 2013, companies having net worth of Rs. 500 crores or more, or turnover of ''1,000 crores or more or net profit of Rs. 5 crores or more during the immediately preceding financial year are required to constitute a Corporate Social Responsibility (CSR) committee of the board comprising three or more directors, at least one of whom should be an independent director and such company shall spend at least 2% of the average net profits of the companyâs three immediately preceding financial years towards CSR activities. Accordingly, your Company spent Rs. 1,853 million towards CSR activities during the financial year 2018-19. The contents of the CSR policy and CSR Report for the year 2018-19 is attached as Annexure V to this report. Contents of the CSR policy are also available on the Companyâs website at https://www.wipro.com/corporate-governance.
The terms of reference of CSR Committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Board Governance, Nomination and Compensation Committee. The Committee consists of three independent directors, Dr. Ashok S Ganguly, Mr. N Vaghul and Mr. William Arthur Owens, as its members. Dr. Ashok S Ganguly is the Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its âSustainabilityâ initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD&A Report.
VI. Other Disclosures
Foreign Exchange Earnings and Outgoings
During the year 2018-19, your Companyâs foreign exchange earnings were Rs. 444,584 million and foreign exchange outgoings were Rs. 230,362 million as against Rs. 391,807 million of foreign exchange earnings and Rs. 207,831 million of foreign exchange outgoings for the financial year 2017-18.
Extract of Annual Return
Pursuant to Section 92(3) and Section 134(3)(a), extract of the annual return as on March 31, 2019 in form MGT-9 is enclosed as Annexure VI to this report. Additionally, your Company has also placed a copy of annual return for the financial year 2017-18 on its website at https://www. wipro.com/investors/annual-reports/
Material Changes and Commitments Affecting the Financial Position of the Company
There have been no material changes and commitments, affecting the financial position of the Company which occurred between the end of the financial year to which the financial statements relate and the date of this report.
Details of Significant and Material Orders Passed by the regulators/courts/tribunals Impacting the going concern status and the Companyâs operations in future
There are no significant material orders passed by the regulators/courts/tribunals which would impact the going concern status of the Company and its future operations.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank its customers, shareholders, suppliers, bankers, business partners/ associates, financial institutions and Central and State Governments for their consistent support and encouragement to your Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of your Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence has ensured that your Company continues to be a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors,
Bengaluru Azim H Premji
June 6, 2019 Executive Chairman
Mar 31, 2018
On behalf of the Board of Directors (the âBoardâ), it gives me great pleasure to present the 72nd Boardâs Report of your Company, along with the Balance Sheet, Statement of Profit and Loss and Statement of Cash Flow for the financial year ended March 31, 2018.
The standalone and consolidated financial statements for the financial year ended March 31, 2018, forming part of this Annual Report, have been prepared in accordance with the Indian Accounting Standards (Ind AS) as notified by the Ministry of Corporate Affairs.
On a consolidated basis, our sales declined to Rs. 5,44,871 million for the current year as against Rs. 5,50,402 million in the previous year, recording a decline of 1%. Our net profits declined to Rs.80,031 million for the current year as against Rs.85,179 million in the previous year, recording a decline of 6.04%.
On a standalone basis, our sales declined to Rs. 4,47,100 million for the current year as against Rs. 4,56,396 million in the previous year, recording a decline of 2.04%. Our net profits declined to Rs. 77,228 million in the current year as against Rs.81,617 million in the previous year, recording a decline of 5.38%.
Key highlights of financial performance of your Company for the financial year 2017-18 are provided below:
(Rs. in millions)
Standalone |
Consolidated |
|||
2017-18 |
2016-17 |
2017-18 |
2016-17 |
|
Sales and Other Income |
4,71,896 |
4,86,937 |
5,70,358 |
5,80,710 |
Profit before Tax |
1,00,343 |
1,06,871 |
1,02,422 |
1,10,393 |
Provision for Tax |
23,115 |
25,254 |
22,391 |
25,214 |
Net profit for the year* |
77,228 |
81,617 |
80,031 |
85,179 |
Other comprehensive (loss)/income for the year |
(7,300) |
5,154 |
(3,127) |
2,184 |
Total comprehensive income for the year* Total comprehensive income for the period attributable to: |
69,928 |
86,771 |
76,094 |
87,363 |
Minority Interest |
- |
- |
19 |
(179) |
Equity holders |
69,928 |
86,771 |
76,885 |
87,184 |
Appropriations Dividend Corporate tax on dividend distribution EPS - Basic - Diluted |
4,525 921 16.26 16.23 |
7,291 1,485 16.80 16.75 |
4,499 921 16.85 16.82 |
7,249 1,485 17.49 17.43 |
-profit for the standalone results is after considering a loss of Rs.49 million (2017: Profit of Rs.210 million) relating to changes in fair value of forward contracts designated as hedges of net investment in non-integral foreign operations, translation of foreign currency borrowings and changes in fair value of related cross currency swaps together designated as hedges of net investment in non-integral foreign operations. In the consolidated financial statements, these are considered as hedges of net investment in non-integral foreign operations.
Dividend
Pursuant to regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), the Board has approved and adopted a Dividend Distribution Policy. The policy details various considerations based on which the Board may recommend or declare dividend, current dividend track record, usage of retained earnings for corporate actions, etc. The policy is available on the Companyâs website at https://www.wipro.com/corporate-governance.
Pursuant to the approval of the Board of Directors on January 19, 2018, your Company paid an interim dividend of Rs.1/- per equity share of face value of Rs.2/- each, to shareholders who were on the register of members as on February 1, 2018, being the record date fixed for this purpose. The Board did not recommend a final dividend and therefore total dividend for the year ended March 31, 2018 will be Rs.1/- per equity share of face value of Rs.2/- each.
Issue of Bonus Equity Shares
The Board of Directors at their meeting held on April 25, 2017, recommended issue of bonus equity shares, in the proportion of 1:1, i.e. 1 (One) bonus equity share of Rs.2/- each for every 1 (one) fully paid-up equity share held (including ADS holders) as of June 14, 2017, the record date fixed for this purpose. This was approved by the members of the Company through resolution dated June 3, 2017 passed through postal ballot/e-voting, subsequent to which the bonus shares were allotted to the shareholders.
Buyback of Equity Shares
Pursuant to the approval of the Board on July 20, 2017 and approval of shareholders through special resolution dated August 28, 2017 passed through postal ballot/e-voting, your Company completed buyback of 34,37,50,000 equity shares of the Company for an aggregate amount of Rs.110,00,00,00,000/-, being 7.06% of the total paid up equity share capital, at Rs.320 per equity share, in December 2017. The buyback was made from all existing shareholders of the Company as on September 15, 2017, being the record date for the purpose, on a proportionate basis under the tender offer route in accordance with the provisions contained in the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998 and the Companies Act, 2013 and rules made there under.
Transfer to Reserves
Appropriations to general reserve for the financial year ended March 31, 2018 as per standalone and consolidated financial statements are as under:
(Rs. In millions)
Standalone |
Consolidated |
|
Net profit for the year Balance of Reserve at the beginning of the year Transfer to General Reserve Balance of Reserve at the end of the year |
77,228 4,62,195 4,13,578 |
80,031 5,11,841 4,70,215 |
Subsidiary Companies
In accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided from pages 250 to 253 of this Annual Report. The statement also provides details of performance and financial position of each of the subsidiaries.
In accordance with fourth proviso to Section 136(1) of the Companies Act, 2013, the Annual Report of your Company, containing inter alia the audited standalone and consolidated financial statements, has been placed on the website of the Company at wipro.com. Further, audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at wipro.com.
During the financial year 2017-18, your Company invested an aggregate of Rs.4,558 million in its direct subsidiaries. Apart from this, your Company funded its subsidiaries, from time to time, as per the fund requirements, through loans, guarantees and other means to meet working capital requirements.
During the year 2017-18, Wipro Australia Pty Limited and Wipro Technologies Norway AS were de-registered, Saaspoint Inc and Wipro Holdings (Mauritius) Limited were liquidated and Wipro Retail UK Limited has been put into liquidation. Further, HPH Holdings Corp. merged with and into Health plan Services, Inc and KI Management Company, LLC merged with and into Appirio Inc.
During the year 2017-18, your Company set up new subsidiaries namely Womenâs Business Park Technologies Limited in Saudi Arabia and Wipro IT Services Bangladesh Limited in Bangladesh to meet its business requirements.
Share Capital
Pursuant to the approval of shareholders through postal ballot/e-voting in June 2017, the authorized share capital of your Company increased from Rs.6,10,00,00,000/- (Rupees Six Hundred and Ten Crores) to Rs.11,26,50,00,000/- (Rupees One Thousand One Hundred and Twenty Six Crores and Fifty Lakhs) by creation of additional 2,58,25,00,000 (Two Hundred and Fifty Eight Crores and Twenty Five Lakhs) equity shares of Rs.2/- (Rupees Two each).
During the year 2017-18, the Company allotted 35,59,599 equity shares and transferred 43,51,775 equity shares of Rs.2/- each from Wipro Equity Reward Trust, pursuant to exercise of stock options by eligible employees and allotted 2,43,30,74,327 equity shares of Rs.2/- each as Bonus Equity Shares on June 15, 2017. Also, the Company extinguished 34,37,50,000 equity shares consequent to buyback in December 2017. Consequently, the paid-up equity share capital of the Company as at March 31, 2018 stood at Rs.9,04,75,68,982 consisting of 4,52,37,84,491 equity shares of Rs.2/- each.
During the year under review, the Company has not issued shares with differential voting rights and sweat equity shares.
Transfer to Investor Education and Protection Fund Authority
a. During the year 2017-18, unclaimed Dividend for financial year 2009-10 and 2010-11 of Rs.63,97,560/and Rs.39,70,354/- respectively, were transferred to the Investor Education and Protection Fund (âIEPFâ), as required under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (âIEPF Authorityâ).
b. During the year 2017-18, 1.21 Million equity shares in respect of which dividend has not been claimed for the final dividend declared in financial year 2009-10 and interim dividend declared in financial year 2010-11 were transferred to the IEPF Authority pursuant to the provisions of Section 124(6) of the Companies Act, 2013 and the rules there under.
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to Section 186 of Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to loans, advances, guarantees and investments are provided as part of the financial statements.
Deposits
Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
Your Company is a leading global information technology (âITâ), consulting and business process services company. Your Company harnesses the power of Cognitive Computing, Hyper-Automation, Robotics, Cloud, Analytics and Emerging Technologies to help its clients adapt to the digital world and make them successful.
Your Company is recognized globally for its comprehensive portfolio of services, strong commitment to sustainability and good corporate citizenship and your Company has over 160,000 dedicated employees serving clients across six continents. Together, your Company discovers ideas and connects the dots to build a better and a bold new future.
Your Company develops and integrates innovative solutions that enable its clients to leverage IT to achieve their business objectives at competitive costs. Your Company uses its quality processes and global talent pool to deliver âtime to developmentâ advantages, cost savings and productivity improvements.
Your Companyâs IT Services business provides a range of IT and IT-Enabled Services which include Digital Strategy Advisory, Customer-Centric Design, Technology Consulting, IT Consulting, Custom Application Design, Development, Re-engineering and maintenance, Systems Integration, Package Implementation, Global Infrastructure Services, Analytics Services, Business Process Services, Research and Development and Hardware and Software design to leading enterprises worldwide. Your Company offers these services globally by leveraging its Products, Platforms, Partnerships and Solutions including state of the art automation technologies such as its proprietary cognitive intelligence tool, Wipro HOLMES⢠Artificial Intelligence Platform (âWipro HOLMESâ). Wipro is recognized globally for its comprehensive portfolio of services, and a strong commitment to sustainability and corporate citizenship.
The vision for your Companyâs business is âTo earn our clientsâ trust and maximize the value of their businesses by providing solutions that integrate its deep industry insights, its leading technology and best-in-class executionâ. Your Company seeks to emphasize its core values of being passionate about its clientâs success, treating each person with respect, being global and responsible, and maintaining unyielding integrity in everything it does.
On the technology front, Digital business has changed the nature of demand for IT services. Development of advanced technologies such as Cloud based offerings, Big Data Analytics, Mobile Applications and the emergence of Social Media is making technology an integral part of the business model of your Companyâs clients. In addition to the Chief Information Officer, newer stakeholders such as Chief Marketing Officer, Chief Digital Officer and Chief Risk Officer play a key role in shaping the technology roadmap of its clients. These trends on newer business models, emerging technologies and sourcing patterns provide Wipro with significant growth opportunities.
Your Companyâs IT Products segment provides a range of third-party IT products, which allows it to offer comprehensive IT system integration services. These products include computing, platforms and storage, networking solutions, enterprise information security and software products, including databases and operating systems. Your Company has a diverse range of clients, primarily in the India and Middle East markets from small and medium enterprises to large enterprises in all major industries. Your Company continues to focus on being a system integrator of choice where it provides IT products as a complement to its IT services offerings rather than sell standalone IT products.
In May 2017, to keep your Companyâs brand contemporary, your Company unveiled its new brand identity, including a new company logo.
Outlook
According to the Strategic Review 2018 of NASSCOM in FYâ18, IT export revenue, from India grew by 7.8%, to an estimated $126 billion. In FYâ19, NASSCOM expects revenue from IT exports to grow by 7% to 9%.
Acquisitions, Investments and Divestments
Acquisitions are a key enabler for driving your Companyâs capability to build industry domain, focus on key strategic areas, strengthen its presence in emerging technology areas including Digital, and increase market footprint in newer markets. Your Company focuses on opportunities where it can further develop its domain expertise, specific skill sets and its global delivery model to maximize service and product enhancements and higher margins.
Acquisitions consummated during the year ended March 31, 2018 included Infoserver S.A. and Cooper Software, Inc. Info server S. A. is a Brazilian IT Services company that predominantly caters to the Banking, Financial Services and Insurance markets in Brazil. With this acquisition, your Company and Info server S. A. will be able to deliver a full suite of integrated IT services across Digital, Consulting, and Business Process Services to four of the top five banks in Brazil. Cooper Software, Inc., is an award winning design and business strategy consultancy. Cooper Software, Inc., will further strengthen design and innovation capabilities and expand reach in North America besides adding capabilities in professional design education. By adding Cooper Softwareâs skills and expertise, your Company will be better positioned to support its clientsâ digital programs.
Your Company also made minority investments in Denim Group, Ltd., a leading independent application security firm, serving as a trusted advisor to customers on matters of application risk and security and Harte Hanks, Inc., a US based global digital marketing services company specializing in omni-channel marketing solutions including consulting, strategic assessment, data, analytics, digital, social, mobile, print, direct mail and contact center. Also, during the year ended March 31, 2018, your Company has increased its ownership in Drive stream Inc. from 19% to 43.7%.
Further, your Company has signed a definitive agreement to divest its data center services business to Ensono Holdings, LLC (âEnsonoâ), a leading hybrid IT services provider. This divestment will help us focus on accelerating investments in the digital space. At the same time, your Company remains committed to serving its hosted data center customers and the market through its business partnership with Ensono. The sale is expected to close during the quarter ending June 30, 2018. Further, we have entered into an agreement with Ensono to acquire 10.2% stake in the entity. Ensono has a right to repurchase up to an aggregate of 5.5% of the above units if Wipro is not able to achieve certain joint business milestones agreed between the parties.
Additionally, after March 31, 2018, your Company has reduced its equity holding in Wipro Airport IT Services Limited (WAISL), which was a joint venture between Wipro Limited and Delhi International Airport Limited, from 74% to 11%, by selling its stake to Antariksh Softtech Private Limited on April 5, 2018. Even after this divestment, WAISL will continue to outsource IT services of the airport to Wipro Limited as per the existing arrangement.
Merger of Wholly Owned Subsidiaries
At its meeting held on April 25, 2018, the Board considered and approved a scheme of amalgamation pursuant to Sections 230 to 232 read with Section 234 and other relevant provisions of the Companies Act, 2013, providing for the merger of its wholly owned subsidiaries, Wipro Technologies Austria GmbH, Wipro Information Technology Austria GmbH, NewLogic Technologies SARL and Appirio India Cloud Solutions Private Limited with Wipro Limited. The scheme of amalgamation is subject to necessary statutory and regulatory approvals under applicable laws, including approval of the National Company Law Tribunal in India. The scheme of amalgamation will, inter alia, enable optimization of legal entity structure through rationalization of number of subsidiaries, integration of business operations leading to operational synergies, provide your Company seamless access to the assets of the subsidiaries and also result in reduction of the multiplicity of legal and regulatory compliances.
Management Discussion and Analysis Report
In terms of regulation 34 of the Listing Regulations and SEBI circular no. SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (âIIRCâ) as part of its Management Discussion and Analysis report (âMD&A Reportâ). The MD&A Report, capturing your Companyâs performance, industry trends and other material changes with respect to your Companies and its subsidiaries, wherever applicable, are presented from pages 14 to 55 of this Annual Report. The MD&A Report provides a consolidated perspective of economic, social and environmental aspects material to your Companyâs strategy and its ability to create and sustain value to your Companyâs key stakeholders and includes aspects of reporting as required by regulation 34 of the Listing Regulations on Business Responsibility Report. Statutory section of Business Responsibility Report is provided from pages 309 to 315 to this Annual Report.
Key Awards and Recognitions
Your Company is one of the most admired and recognized companies in the IT industry. Your Company won several awards and accolades, out of which key recognitions are given below:
1. Wipro was recognized as one of Indiaâs most innovative companies by Confederation of Indian Industry (CII) at the Industrial Innovation Awards 2017.
2. Wiproâs Open Banking API Platform won the 2017 API Awards at API World under the âTravel APIsâ category.
3. Wipro won the âBest Block chain Application of the Yearâ award at the Global Logistics Excellence Awards 2018.
4. Wipro is amongst the top 6 firms in the Constellation Research shortlist on âSynchronous Ledger Tech (Block chain) Companies to Watch Forâ.
5. Wipro has been recognized as Platform Partner of the Year 2017 by BMC Software and won the highest number of accreditations for Security Operations at the BMC Outsourcers Tech Summit (BOTS).
6. Wipro was ranked #2 in the list of âTop 20 Service Outsourcing MNCs in China 2017â in a study by Devott, a leader in research and advisory of Chinaâs outsourcing and technology markets.
7. Wipro was recognized as the leading AI Partner for 2017 by Intel Corporation at the Intel AI and HPC Ecosystem Summit 2018 for driving transformational outcomes for clients.
8. Wipro has been recognized as a market leader in Digital Workplace Services by Information Services Group (ISG), a leading global technology research and advisory firm.
9. Wipro has been named an IDC Health Insights Health Tech Rankings Enterprise 25 Company. The rankings categorize and evaluate global providers of information technology to healthcare payers and providers.
10. Wipro has been recognized in the âLeadershipâ category for corporate governance practices on the basis of the Indian Corporate Governance Scorecard, which is a framework developed jointly by International Finance Corporation, a member of the World Bank group, BSE Limited and Institutional Investor Advisory Services based on globally accepted G20/OECD principles.
11. Wipro was included in the Dow Jones Sustainability Index (DJSI) - World and Emerging Markets for the eighth time in succession.
12. Wipro was recognized as the 2018 Worldâs Most Ethical Company® for the seventh successive year by the Ethisphere Institute, the global leader in defining and advancing the standards of ethical business practices.
Corporate Governance
Your Company believes in adopting best practices of corporate governance. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Companyâs code of business conduct, Corporate Governance guidelines, charter of various sub-committees and disclosure policy.
As per regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Practicing Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided at page 101 to this Annual Report.
Board of Directors
Boardâs Composition and Independence
Your Companyâs Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31, 2018, the Board comprised three Executive Directors and seven Non-Executive Independent Directors.
Definition of âIndependenceâ of Directors is derived from regulation 16 of the Listing Regulations, NYSE Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company has received necessary declarations from the Independent Directors stating that they meet the prescribed criteria for independence.
Based on the confirmations/disclosures received from the Directors under Section 149(7) of the Companies Act 2013 and on evaluation of the relationships disclosed, the following Non-Executive Directors are considered as Independent Directors:
a. Mr. N Vaghul
b. Dr. Ashok S Ganguly
c. Mr. M K Sharma
d. Ms. Ireena Vittal
e. Mr. William Arthur Owens
f. Dr. Patrick J Ennis
g. Mr. Patrick Dupuis
Number of Meetings of the Board
The Board met five times during the financial year 2017-18 on April 24-25, 2017, June 2, 2017, July 19-20, 2017, October 16-17, 2017 and January 18-19, 2018. The maximum interval between any two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
At the 71st Annual General Meeting (AGM) held on July 19, 2017, Mr Azim H Premji was re-appointed as Executive Chairman and Managing Director of the Company to hold office with effect from July 31, 2017 to July 30, 2019. Further, Mr. William Arthur Owens was re-appointed as Independent Director for a second term with effect from August 1, 2017, to July 31, 2022.
At the 68th AGM held on July 23, 2014, Ms. Ireena Vittal was appointed as an Independent Director to hold office up to September 30, 2018.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee and based on the report of performance evaluation, the Board at its meeting held on April 25, 2018 decided to place the proposal for re-appointment of Ms. Ireena Vittal as an Independent Director for a further term of 5 years from October 1, 2018 to September 30, 2023, for approval of the members at the 72nd AGM. The Company has received requisite notice under Section 160 of the Companies Act, 2013 from a member, along with the requisite deposit, signifying his intention to propose re-appointment of Ms. Ireena Vittal as mentioned above. Accordingly, necessary resolutions are being placed for approval of the members at the 72nd AGM of the Company.
Pursuant to the provisions of Section 152 of the Companies Act, 2013 and the Articles of Association of the Company, Mr. Rishad A Premji will retire by rotation at the 72nd AGM and being eligible, has offered himself for re-appointment.
Committees of the Board
The Companyâs Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as the Risk Management Committee
2. Board Governance, Nomination and Compensation Committee, which also acts as CSR Committee
3. Strategy Committee
4. Administrative and Shareholders/Investors Grievance Committee (Stakeholdersâ Relationship Committee)
Details of terms of reference of the Committees, Committee membership and attendance at meetings of the Committees are provided in the Corporate Governance report from pages 106 to 109 of this Annual Report.
Board Evaluation
In line with the Corporate Governance Guidelines of the Company, Annual Performance Evaluation was conducted for all Board Members as well as the working of the Board and its Committees. This evaluation was led by the Chairman of the Board Governance, Nomination and Compensation Committee with specific focus on the performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in consonance with Guidance Note on Board Evaluation issued by SEBI in January 2017. The Board evaluation was conducted through questionnaire having qualitative parameters and feedback based on ratings.
Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance and compensation to Executive Directors, succession planning, strategic planning, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience and expertise to provide feedback and guidance to top management on business strategy, governance and risk, understanding of the organizationâs strategy, risk and environment, etc.
Evaluation of Committees was based on criteria such as adequate independence of each Committee, frequency of meetings and time allocated for discussions at meetings, functioning of Board Committees and effectiveness of its advice/recommendation to the Board, etc.
The outcome of the Board evaluation for financial year 2017
18 was discussed by the Board Governance, Nomination and Compensation Committee and the Board at their meeting held in April 2018. The Board has received improved ratings on its overall effectiveness, including higher rating on Board communication, relationships and Board Committees. The Board has also noted areas requiring more focus in the future.
Policy on Directorâs Appointment and Remuneration
The Board Governance, Nomination & Compensation Committee has framed a policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel, Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013. The policy covering these requirements is provided in the Corporate Governance report at page 104 to this Annual Report. We affirm that the remuneration paid to Directors is as per the remuneration policy of the Company.
Vigil Mechanism
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and Directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013 and regulation 22 of the Listing Regulations.
Under this policy, your Company encourages its employees to report any reporting of fraudulent financial or other information to the stakeholders, and any conduct that results in violation of the Companyâs code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation or harassment of any kind against any employees who, based on the employeeâs reasonable belief that such conduct or practice have occurred or are occurring, reports that information or participates in the investigation.
Mechanism followed under Ombuds process is appropriately communicated within the Company across all levels and has been displayed on the Companyâs intranet and website at https://www.wipro.com/corporate-governance/#WiprosOmb udsProcess.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company were denied access to the Audit, Risk & Compliance Committee.
Information Required under Sexual Harassment of Women at Work place (Prevention, Prohibition & Redressal) Act, 2013
Your Company has a policy and framework for employees to report sexual harassment cases at workplace and its process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programs against sexual harassment are conducted across the organization. A total of 101 complaints of sexual harassment were raised in the calendar year 2017, of which 92 cases were disposed and appropriate actions were taken in all cases within the statutory timelines.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at armâs length as part of its philosophy of adhering to highest ethical standards, transparency and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. An abridged policy on related party transactions has been placed on the Companyâs website https://www.wipro.com/ corporate-governance.
All Related Party Transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for approval. Prior omnibus approval of the Audit, Risk and Compliance Committee and the Board is obtained for the transactions which are of a foreseeable and repetitive nature.
The particulars of contracts or arrangements with related parties referred to in Section 188(1) and applicable rules of the Companies Act, 2013 in Form AOC-2 is provided as Annexure I to this Report.
Risk Management
Given the diversified scale of operations, your Company has put in place an Enterprise Risk Management (ERM) framework and adopted an enterprise risk management policy based on globally recognized standards. The ERM framework is administered by the Audit, Risk and Compliance Committee. The objective of the ERM framework is to enable and support achievement of business objectives through risk-intelligent assessment while also placing significant focus on constantly identifying and mitigating risks within the business. The ERM Framework covers various categories of risks including, inter alia, information security and cyber security risks, effectiveness of the controls that have been implemented to prevent such risks and continuous improvement of the systems and processes to mitigate such risks.
Further details on the Companyâs risk management framework is provided in the MD&A Report.
Compliance Management Framework
Your Company has a robust and effective framework for monitoring compliances with applicable laws. The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances real-time and provide update to senior management and Board on a periodic basis. The Audit, Risk and Compliance Committee and the Board periodically monitors status of compliances with applicable laws based on quarterly certification provided by senior management.
Directorsâ Responsibility Statement
Your Directors hereby confirm that:
a. in the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
b. the Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
c. the Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
d. the Directors have prepared the annual accounts on a going concern basis; and
e. the Directors, have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively;
f. as required under Section 134(5)(f) of the Companies Act, 2013, and according to the information and explanations presented to us, based on the review done by the Audit, Risk and Compliance Committee and as recommended by it, we, the Board, hereby, state that adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Companyâs Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Wipro Employee Stock Option Plans (WESOP)/Restricted Stock Unit Plans
In order to motivate, incentivize and reward employees, your Company has instituted various employee stock options plans/restricted stock unit plans from time to time. The Board Governance, Nomination and Compensation Committee administers these plans. The stock option plans are in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014
(âEmployee Benefits Regulationsâ) and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations read with Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Companyâs website at https://www.wipro.com/annual-reports. No employee was issued stock options during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
Wipro Equity Reward Trust (WERT) is an ESOP Trust set up by your Company. Pursuant to approval by the shareholders at their meeting held in July 2014, the Company is authorized to transfer shares from the WERT to employees on exercise of vested Indian RSUs.
Particulars of Employees
Information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report.
A statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of Rs.102 lakhs or more, and employees employed for part of the year and in receipt of Rs.8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure III to this report.
Internal Financial Controls and their Adequacy
The Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, the safeguarding of its assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
Statutory Auditors
The term of BSR & Co. LLP, (Registration No.101248W/ W-100022) Chartered Accountants, Bangalore, ended with the conclusion of audit for the financial year 2016-17. After conducting a detailed evaluation and based on the recommendation of Audit, Risk and Compliance Committee, the Board approved the proposal for appointment of Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 117366W/W-100018) as statutory auditors of the Company for a term of 5 years from the financial year 2017-18 onwards on such terms and conditions and remuneration as may be decided by the Audit, Risk and Compliance Committee. The said appointment was approved by the members of the Company at the 71st AGM held on July 19, 2017.
Vide notification dated May 7, 2018 issued by Ministry of Corporate Affairs, the requirement of seeking ratification of appointment of statutory auditors by members at each AGM has been done away with. Accordingly, no such item has been considered in notice of the 72nd AGM.
Auditorsâ Report
There are no qualifications, reservations or adverse remarks made by Deloitte Haskins & Sells LLP, Statutory Auditors, in their report for the financial year ended March 31, 2018.
Pursuant to provisions of Section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V Sreedharan, Partner, V Sreedharan & Associates, a firm of Company Secretaries in Practice, to conduct Secretarial Audit of the Company. The Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31, 2018 is enclosed as Annexure IV to this Report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
Corporate Social Responsibility
Your Company is at the forefront of Corporate Social Responsibility (CSR) and sustainability initiatives and practices. Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. Your Company has been involved with social initiatives for more than decade and a half and engages in various activities in the field of education, primary healthcare and communities, ecology and environment, etc. Your Company has won several awards and accolades for its CSR and sustainability efforts.
As per the provisions of the Companies Act, 2013, companies having net worth of Rs.500 crore or more, or turnover of Rs.1,000 crore or more or net profit of Rs.5 crore or more during the immediately preceding financial year are required to constitute a Corporate Social Responsibility (CSR) committee of the Board comprising three or more directors, at least one of whom should be an independent director and such company shall spend at least 2% of the average net profits of the companyâs three immediately preceding financial years towards CSR activities. Accordingly, your Company has spent Rs.1,866 million towards CSR activities during the financial year 2017-18. The contents of the CSR policy and CSR Report for the year 2017-18 is attached as Annexure V to this Report. Contents of the CSR policy is also available on the Companyâs website at https://www. wipro.com/corporate-governance. The terms of reference of CSR committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Board Governance, Nomination and Compensation Committee. The Committee consists of three independent directors, Dr. Ashok S Ganguly, Mr. N Vaghul and Mr. William Arthur Owens, as its members. Dr. Ashok S Ganguly is the Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its âSustainabilityâ initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD&A Report.
Foreign Exchange Earnings and Outgoings
During the year 2017-18, your Companyâs foreign exchange earnings were Rs.3,91,807 million and foreign exchange outgoings were Rs.2,07,831 million as against Rs.4,04,000 million of foreign exchange earnings and Rs.2,12,910 million of foreign exchange outgoings for the financial year 2016-17.
Extract of Annual Return
Pursuant to Section 92(3) and Section 134(3)(a) of the Companies Act, 2013, extract of the Annual Return as on March 31, 2018 in form MGT-9 is enclosed as Annexure VI to this report.
Material Changes and Commitments Affecting the Financial Position of the Company
There have been no material changes and commitments, affecting the financial position of the Company which occurred between the end of the financial year to which the financial statements relate and the date of this report.
Details of Significant and Material Orders Passed by the regulators/Courts/Tribunals Impacting the Going Concern Status and the Companyâs Operations in Future
There are no significant and material orders passed by the Regulators/Courts/Tribunals which would impact the going concern status of the Company and its future operations.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/ associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of the Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence has ensured that the Company continues to be a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors,
Bangalore Azim H Premji
June 8, 2018 Executive Chairman
Mar 31, 2017
Boardâs Report
On behalf of the Board of Directors (the âBoardâ), it gives me great pleasure to present the 71st Boardâs Report of your Company, along with the Balance Sheet, Profit and Loss account and Cash Flow statements, for the financial year ended March 31, 2017.
I. Financial Performance
Vide notification dated February 16, 2015, the Ministry of Corporate Affairs notified the Indian Accounting Standards (âInd ASâ) to be applicable to certain class of companies including listed companies, for the accounting periods beginning on or after April 1, 2016, with comparatives to be provided for the period ending on March 31, 2016. Ind AS has replaced the existing Indian GAAP prescribed under section 133 of the Companies Act, 2013. The standalone and consolidated financial statements for the financial year ended March 31, 2017, forming part of this Annual Report, have been prepared in accordance with Ind AS with a transition date of April 1, 2015. Explanations capturing areas of differences and reconciliations from Indian GAAP to Ind AS have been provided in the notes to accounts to the standalone and consolidated financial statements.
Vna consolidated basis, our sales increased to Rs, 550,402 million for the current year as against Rs, 512,440 in the previous year, recording a growth of 7.41%. Our net profits declined to Rs, 85,179 million for the current year as against Rs, 89,571 million in the previous year, recording a decline of 4.90%.
Vna standalone basis, our sales increased to Rs, 456,396 million for the current year as against Rs, 446,808 million in the previous year, recording a growth of 2.15%. Our net profits declined to Rs, 81,617 million for the current year as against Rs, 82,005 million in the previous year, recording a decline of 0.47%.
Vey highlights of financial performance of your Company for the financial year 2016-17 are as follows:
(Rs, in millions)
Standalone |
Consolidated |
|
||
2016-17 |
2015-16 |
2016-17 |
2015-16 |
|
Sales and Other Income |
4,86,178 |
4,73,914 |
5,79,951 |
5,39,962 |
Profit before Tax |
1,06,871 |
1,05,942 |
1,10,393 |
1,14,937 |
Provision for Tax |
25,254 |
23,937 |
25,214 |
25,366 |
Net profit for the year* |
81,617 |
82,005 |
85,179 |
89,571 |
Other comprehensive income for the year |
5,154 |
(2,052) |
2,184 |
2,708 |
Total comprehensive income for the year* |
86,771 |
79,953 |
87,363 |
92,279 |
Total comprehensive income for the period attributable to: |
||||
Minority Interest |
- |
- |
(179) |
(578) |
Equity holders |
86,771 |
79,953 |
87,184 |
91,701 |
Appropriations |
||||
Dividend |
7,291 |
29,635 |
7,249 |
29,457 |
Corporate tax on dividend distribution |
1,485 |
6,037 |
1,485 |
6,037 |
EPS - Basic - Diluted |
33.61 33.51 |
33.38 33.31 |
34.97 34.87 |
36.26 36.19 |
* Profit for the standalone results is after considering a profit of Rs, 210 million (2016: Loss of '' 563 million) relating to changes in fair value of forward contracts designated as hedges of net investment in no integral foreign operations, translation of foreign currency borrowings and changes in fair value of related cross currency swaps together designated as hedges of net investment in non-integral foreign operations. In the Consolidated Financial Statements, these are considered as hedges of net investment in non-integral foreign operations.
Dividend
Pursuant to regulation 43A of Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015 (âListing Regulationsâ), the Board approved a Dividend Distribution Policy at its meeting held over October 20-21, 2016. The policy details various considerations based on which the Board may recommend or declare Dividend, current dividend track record, usage of retained earnings for corporate actions, etc. The policy is available on the Companyâs website at http:// www.wipro.com/investors/corporate-governance/ policies-and-guidelines/
Pursuant to the approval of the Board on January 25, 2017, your Company paid an Interim Dividend of Rs,2/- per equity share of face value of Rs, 2/- each, to shareholders who were on the register of members as on February 3, 2017, being the record date fixed for this purpose. The Board did not recommend a final Dividend and therefore total Dividend for the year ended March 31, 2017 will be Rs, 2/- per equity share of face value of Rs, 2/- each.
During the year 2016-17, unclaimed Dividend for financial year 2008-09 of Rs, 41,75,404/- was transferred to the Investor Education and Protection Fund (IEPF), as required under the Investor Education and Protection Fund Authority (Accounting, Audit, Transfer and Refund) Rules, 2016 (as amended from time to time). Pursuant to the provisions of section 124(6) of the Companies Act, 2013 and the rules mentioned aforesaid, equity shares in respect of which dividend has not been claimed for the financial year 2008-09 will be transferred to the IEPF Authority in accordance with the aforesaid rules.
Buyback of Equity Shares
Pursuant to the approval of the Board on April 20, 2016, your Company completed buyback of 4,00,00,000 equity shares in July 2016 for an aggregate amount of Rs, 2500,00,00,000/-, being 1.62% of the total paid up equity share capital, at Rs, 625 per equity share. The buyback was made from all existing shareholders of the Company as on May 6, 2016, the record date for the buyback, on a proportionate basis under the tender offer route in accordance with the provisions contained in the Securities and Exchange Board of India (Buy Back of Securities) Regulations, 1998 and the Companies Act, 2013 and rules made there under. The Board will consider a proposal for another buyback of equity shares of the Company around July 2017.
Issue of Bonus Shares
On April 25, 2017, the Board recommended a proposal for issue of Bonus Equity Shares in the proportion of 1:1, that is 1 (One) bonus equity share of Rs, 2/- each for every 1 (One) fully paid-up equity share held (including ADS holders) as on the record date, subject to approval of the shareholders of the Company through postal ballot. The record date for reckoning eligible shareholders (including ADS holders) entitled to receive bonus shares is June 14, 2017. The bonus issue is likely to be completed on or before June 24, 2017.
Transfer to Reserves
Appropriations to general reserve for the financial year ended March 31, 2017 as per standalone and consolidated financial statements are as under:
(Rs, in millions)
Standalone |
Consolidated |
|
Net profit for the year |
81,617 |
85,179 |
Balance of Reserve at the beginning of the year |
4,07,316 |
4,56,507 |
Transfer to General |
||
Reserve |
||
Balance of Reserve at the |
4,62,195 |
5,11,841 |
end of the year |
Subsidiary Companies
I n accordance with Section 129(3) of the Companies Act, 2013, a statement containing salient features of the financial statements of the subsidiary companies in Form AOC-1 is provided from page nos. 262 to 265 of this Annual Report. The statement also provides details of performance and financial position of each of the subsidiaries.
I n accordance with third proviso to Section 136(1) of the Companies Act, 2013, the Annual Report of your Company, containing inter alia the audited standalone and consolidated financial statements, has been placed on the website of the Company at www.wipro.com. Further, audited financial statements together with related information and other reports of each of the subsidiary companies have also been placed on the website of the Company at www.wipro.com.
During the financial year 2016-17, your Company invested an aggregate 994 million in its direct subsidiaries. Apart from this, your Company funded its subsidiaries, from time to time, as per the fund requirements, through loans, guarantees and other means to meet working capital requirements.
During the year 2016-17, Wipro Promax Holdings Pty Ltd and Wipro Promax IP Pty Ltd were de-registered and 3D Networks UK Limited was liquidated. Further, Knowledge Infusion LLC was merged with and into Appirio Inc., Harrington Health Services, Inc. was merged with and into HealthPlan Services, Inc., and HealthPlan Holdings, Inc. was merged with and into HPH Holdings Corp.
Share Capital
On order to have adequate capital to accommodate the issue of bonus equity shares, the Board at its meeting held on April 25, 2017 approved increase in authorized capital from '' 610,00,00,000/- (Rupees Six Hundred and Ten Crores) to '' 1126,50,00,000/-(Rupees One Thousand One Hundred and Twenty Six Crores and Fifty Lakhs) by creation of additional 258.25.00.000 (Two Hundred and Fifty Eight Crores and Twenty Five Lakhs) equity shares of '' 2/- (Rupees Two each) and consequent amendment to clause 5 of the Memorandum of Association of the Company. The increase in authorized share capital is subject to approval of the shareholders through postal ballot.
During the year 2016-17, the Company allotted 1,87,275 equity shares and transferred 11,01,217 equity shares of '' 2/- each pursuant to exercise of stock options. Also, the Company extinguished 4.00.00.000 equity shares consequent to buyback in July 2016. Consequently, the paid-up equity share capital of the Company as at March 31, 2017 stood at '' 486,18,01,130/- consisting of 243,09,00,565 equity shares of '' 2/- each.
During the year under review, the Company has not issued shares with differential voting rights and sweat equity shares.
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to section 186 of Companies Act, 2013 and Schedule V of the Listing Regulations, disclosure on particulars relating to Loans, Advances, Guarantees and Investments are provided as part of the financial statements.
Deposits
Your Company has not accepted any deposits from public and as such, no amount on account of principal or interest on public deposits was outstanding as on the date of the balance sheet.
II. Business
Your Company is one of the leading providers of IT Services globally. It combines the business knowledge and industry expertise of its domain specialists and the technical knowledge and implementation skills of its Delivery team leveraging its Products, Platforms, Partnerships and Solutions in its Development Centers located around the world.
Your Company develops and integrates innovative solutions that enable its clients to leverage IT to achieve their business objectives at competitive costs. Your Company uses its quality processes and global talent pool to deliver âtime to developmentâ advantages, cost savings and productivity improvements.
Your Companyâs IT Services business provides a range of IT and IT enabled Services which include Digital Strategy Advisory, Customer-Centric Design, Technology Consulting, IT Consulting, Custom Application Design, Development, Re-Engineering and Maintenance, Systems Integration, Package Implementation, Global Infrastructure Services, Analytics Services, Business Process Services, Research and Development and Hardware and Software design to leading enterprises worldwide.
V he vision for your Companyâs business is âTo earn our Clientsâ trust and maximize value of their businesses by providing Solutions that integrate deep industry insights, leading technologies and best in class executionâ. Our ambition for 2020 has set the direction of our strategy.
The markets your Company serves are undergoing rapid changes due to the pace of developments in technology, innovation in business models and changes in the sourcing strategies of clients. Pressures on cost-competitiveness, an uncertain economic environment and immigration restrictions are causing clients to develop newer business models. On the technology front, Digital business has changed the nature of demand for IT Services. Development of Advanced Technologies such as Cloud based Offerings, Big Data Analytics, Mobile
Applications and the emergence of Social Media are shifting the point of decision-making on IT Sourcing within clientsâ organization from the traditional Chief Information Officer to newer stakeholders such as Chief Marketing Officer, Chief Digital Officer and Chief Risk Officer. These trends on newer business models, emerging technologies and sourcing patterns provides your Company with significant growth opportunities.
Your Companyâs IT Products segment provides a range of third-party IT Products, which allows it to offer comprehensive IT System Integration Services. These products include Computing, Platforms and Storage, Networking Solutions, Enterprise Information Security and Software Products, including Databases and Operating Systems. Your Company has a diverse range of clients, primarily in the India and Middle East markets from small and medium enterprises to large enterprises in all major industries. Your Company continues to focus on being a system integrator of choice where it provides IT Products as a complement to its IT Services Offerings rather than sell standalone IT Products.
Outlook
According to Strategic Review 2017 of the National Association of Software and Service (âNASSCOMâ), in FY17, IT export revenues from India grew by 7.6%, to an estimated $117 billion. NASSCOM projects the Indian Technology & Services industry to reach $200 billion to $225 billion in revenues by 2020 and over $350 billion by 2025, from a base of $154 billion in 2017.
Acquisitions and Investments
Acquisitions are a key enabler for driving your Companyâs capability to build industry domain, strengthen its presence in emerging technology areas including Digital and Cloud, and increase market footprint in newer markets. Your Company focuses on opportunities where it can further develop its domain expertise, specific skill sets and its global delivery model to maximize service and product enhancements and higher margins. Your Company also uses its acquisition program to increase footprint in certain large customers and pursue select business opportunities. During the year ended March 31, 2017, your Company acquired Appirio Group, a global Cloud Services company that creates next generation worker and customer experiences. In April 2017, your Company acquired Info server S.A., a specialized IT Services provider for Banking, Financial Services & Insurance sector in Brazil.
Vs part of a start-up engagement model, your Company has invested in building world-class partnerships through a US$ 100 million corporate venture capital fund, Wipro Ventures, aimed at investing in cutting edge start-ups in areas such as Digital, Internet of Things, Big Data, Open Source, Cyber security , Fintech and Security, Supplier Collaboration Platform and Artificial Intelligence (AI). During the fiscal year ended March 31, 2017, Wipro Ventures has seen strong traction and scale. Currently, there are 9 such investments with a cumulative spend of $ 24.5 million in start-ups working in Big Data and Analytics (Talena, Inc.), Artificial Intelligence (Vicarious FPC, Inc., investments through TLV partners), Internet of Things, (Altizon Systems Private Limited), Mobility (Avaamo Inc.), Supplier Collaboration Platform (Tradeshift Inc.), Fintech and Security (Vectra Networks Inc., Emailage Corp., Inc. and IntSights Cyber Intelligence Limited)- technologies that are reshaping the future of enterprises.
Brand
Your Company is a trusted name in the marketplace, with an enviable history of business success, built on a strong set of values. Today, the shifting sands in the market underscore the need to introspect, self-examine and embrace change. A little over a year ago, your Company embarked on a journey of transformation, with courage and conviction, to shape its future. This journey called for a new visual identity. A visual identity that reflects the promise the Wipro brand makes to its clients - To bring a pioneering, entrepreneurial spirit and an integrated perspective to solve its clientsâ complex business problems.
Your Company unveiled its new brand identity, and the new logo represents the way your Company âconnect the dotsâ for its clients and bring the power of connected insights with a sense of history - now seen through a Digital lens for a digital world. The brand identity embodies the positive energy that each one of us brings both individually and collectively.
Along with the new identity, your Company has rearticulated the Spirit of Wipro. Values are an intrinsic part of Wipro and are closely aligned with its brand. Your Companyâs Brand identity is a visual expression of its core values, the guidepost for its decisions, its culture and what it stands for as an organization.
Your Companyâs core Values provide its employees with the moral compass to deliver on its brand promise: Be passionate about clientsâ success, Treat each person with respect, Be global and responsible, and Unyielding integrity in everything we do.
Key Awards and Recognitions
Your Company is one of the most admired and recognized companies in the IT industry. During the year, your Company won several awards and accolades, out of which key recognitions are given below:
- Wipro received the Citi Lean Partner award for 2015 in recognition of its high levels of service and performance.
- Wipro was recognized with the Best Global Healthcare and Life Sciences IT Consultancy & Outsourcing Company Award 2016 at Global Health and Pharmaâs 2016 International Life Sciences Awards.
- Wipro was positioned as a âLeaderâ in Everest Groupâs 2016 PEAK Matrix⢠for Independent Testing Services for the second consecutive year.
- Wipro was included in the Dow Jones Sustainability Index (DJSI) - World and Emerging Markets for the seventh time in succession.
- Wipro won the Teradata Epic Award for ICP Collaborative Revenue category at Teradata Partners Conference & Expo 2016.
- Wipro was recognized as the âBest Collaboration Partnerâ by Land Transport Authority (LTA), Singapore at the Land Transport Excellence Awards 2016
- Wipro was recognized a Leader for the Third Consecutive Year in Gartnerâs Magic Quadrant for Application Testing Services, Worldwide
- Wipro was rated as the leading player in the âZinnov Zones 2016 Product Engineering Services reportâ by Zinnov Management Consulting for the seventh consecutive year
- Wipro has been recognized with the âChallenge the Future® 2017 award by Information Services Group (ISG), a leading global technology research and advisory firm.
Management Discussion and Analysis Report
V n terms of regulation 34 of the Listing Regulations and SEBI circular SEBI/HO/CFD/CMD/CIR/P/2017/10 dated February 6, 2017, your Company has adopted salient features of Integrated Reporting prescribed by the International Integrated Reporting Council (âIIRCâ) as part of its Management Discussion and Analysis report (âMD&A Reportâ). The MD&A report, capturing your Companyâs performance, industry trends and other material changes with respect to your Companies and its subsidiaries, wherever applicable, are presented from page nos. 24 to 64 of this Annual Report. The MD&A Report provides a consolidated perspective of economic, social and environmental aspects material to our strategy and our ability to create and sustain value to our key stakeholders and includes aspects of reporting as required by regulation 34 of the Listing Regulations on Business Responsibility Report. Statutory section on Business Responsibility Report is provided from page nos. 319 to 324 to this Annual Report.
III. Governance and Ethics Corporate Governance
W iproâs governance framework is driven by the objective of enhancing long term stakeholder value without compromising on ethical standards and corporate social responsibilities. Corporate governance principles are enshrined in the Spirit of Wipro, which form the core values of Wipro. These guiding principles are also articulated through the Companyâs code of business conduct, Corporate Governance Guidelines, charter of various subcommittees and disclosure policy.
Vs per regulation 34 of the Listing Regulations, a separate section on corporate governance practices followed by your Company, together with a certificate from V. Sreedharan & Associates, Company Secretaries, on compliance with corporate governance norms under the Listing Regulations, is provided at page no. 129 to this Annual Report.
Board of Directors
Boardâs Composition and Independence
Your Companyâs Board consists of global leaders and visionaries who provide strategic direction and guidance to the organization. As on March 31, 2017, the Board comprised three executive directors and seven non-executive Independent Directors.
Definition of âIndependenceâ of Directors is derived from regulation 16 of the Listing Regulations, NYSE Listed Company Manual and Section 149(6) of the Companies Act, 2013. The Company has received necessary declarations from the Independent Directors stating that they meet the prescribed criteria for independence.
Cased on the confirmations/disclosures received from the Directors under section 149(7) of the Companies Act 2013 and on evaluation of the relationships disclosed, the following Non-Executive Directors are considered as Independent Directors:
a) Mr. N Vaghul
b) Dr. Ashok S Ganguly
c) Mr. William Arthur Owens
d) Mr. M K Sharma
e) Ms. Ireena Vittal
f) Dr. Patrick J Ennis
g) Mr. Patrick Dupuis Number of Meetings of the Board
V he Board met five times during the financial year 2016-17 on April 19-20, 2016, June 3, 2016, July 18-19, 2016, October 20-21, 2016 and January 2425, 2017. The maximum interval between any two meetings did not exceed 120 days.
Directors and Key Managerial Personnel
At the 70th Annual General Meeting (AGM) held on July 18, 2016, Dr. Patrick J Ennis and Mr. Patrick Dupuis were appointed as Independent Directors to hold office from April 1, 2016 up to March 31, 2021.
Pursuant to the recommendation of Board Governance, Nomination and Compensation Committee and based on the report of performance evaluation, the Board at its meeting held on April 20, 2016 appointed Mr. M K Sharma as Additional Director with effect from July 1, 2016 and decided to place the proposal for re-appointment of Mr. N Vaghul and Dr. Ashok S Ganguly as Independent Directors for a further term of 3 years up to July 31, 2019 and Mr. M K Sharma as Independent Director for a further term of 5 years up to June 30, 2021, for approval of the Members at the 70th AGM. The aforesaid appointments/reappointments were approved by the Members at the 70th AGM held on July 18, 2016.
At the 70th AGM held on July 18, 2016, Mr. T K Kurien was re-appointed as Executive Director designated as Executive Vice Chairman from February 1, 2016 up to March 31, 2017 and Mr. Abidali Z Neemuchwala was appointed as Executive Director designated as Chief Executive Officer from February 1, 2016 up to January 31, 2021.
At the 69th Annual General Meeting held on July 22, 2015, Mr. Azim H Premji was re-appointed as Executive Chairman and Managing Director of the Company to hold office up to July 30, 2017. Keeping in view Mr. Azim H Premjiâs rich and varied experience in the Industry, his involvement in the operations of the Company over a long period of time, his pioneering role in guiding the Company through four decades of diversification and growth to emerge as a world leader in the Software industry, and pursuant to the recommendation of Board Governance, Nomination and Compensation Committee, the Board at its meeting held over April 24-25, 2017 approved, subject to Membersâ approval, re-appointment of Mr. Azim H Premji as Executive Chairman and Managing Director for a further period of 2 years from July 31, 2017 to July 30, 2019.
At the 68th Annual General Meeting held on July 23, 2014, Mr. William Arthur Owens was appointed as an Independent Director to hold office up to July 31, 2017. Considering his immense contributions to the Company and pursuant to the recommendation of Board Governance, Nomination and Compensation Committee and based on the report of performance evaluation, the Board at its meeting held over April 24-25, 2017 decided to place the proposal for reappointment of Mr. William Arthur Owens as an Independent Director for a further term of 5 years from August 1, 2017 up to July 31, 2022, for approval of the Members at the 71st AGM.
The Company has received separate notices under section 160 from Members, along with the requisite deposit, signifying their intention to propose reappointment of Mr. Azim H Premji and Mr. William Arthur Owens as mentioned in the preceding paragraphs. Accordingly, necessary resolutions are being placed for approval of the Members at the 71st Annual General Meeting of the Company.
Pursuant to the provisions of section 152 of the Companies Act, 2013 and Articles of Association of the Company, Mr. Abidali Z Neemuchwala will retire by rotation at the 71st AGM and being eligible, has offered himself for re-appointment.
Or. Vyomesh Joshi resigned as Independent Director with effect from close of business hours of July 19, 2016 and Dr. Jagdish N Sheth retired from the Board effective July 18, 2016.
O r. T K Kurien ceased to be the Executive Vice Chairman with effect from close of business hours on January 31, 2017, consequent to his retirement from the Company.
T he Board places on record immense contributions made by Mr. Vyomesh Joshi, Dr. Jagdish N Sheth and Mr. T K Kurien to the growth of your Company over the years.
Committees of the Board
The Companyâs Board has the following committees:
1. Audit, Risk and Compliance Committee, which also acts as the Risk Management Committee
2. Board Governance, Nomination and Compensation Committee, which also acts as the CSR Committee
3. Strategy Committee
4. Administrative and Shareholders/Investors Grievance Committee (Stakeholdersâ Relationship Committee)
Details of terms of reference of the Committees, Committee membership and attendance at meetings of the Committees are provided in the Corporate Governance report from page nos. 118 to120 of this Annual Report.
Board Evaluation
On line with the Corporate Governance Guidelines of the Company, Annual Performance Evaluation was conducted for all Board Members as well as the working of the Board and its Committees.
V his evaluation was led by the Chairman of the Board Governance, Nomination and Compensation Committee with specific focus on the performance and effective functioning of the Board. The Board evaluation framework has been designed in compliance with the requirements under the Companies Act, 2013 and the Listing Regulations, and in consonance with Guidance Note on Board Evaluation issued by SEBI recently. The Board evaluation was conducted through questionnaire having qualitative parameters and feedback based on ratings.
Evaluation of the Board was based on criteria such as composition and role of the Board, Board communication and relationships, functioning of Board Committees, review of performance and compensation to Executive Directors, succession planning, strategic planning, etc.
Evaluation of Directors was based on criteria such as participation and contribution in Board and Committee meetings, representation of shareholder interest and enhancing shareholder value, experience and expertise to provide feedback and guidance to top management on business strategy, governance and risk, understanding of the organizationâs strategy, risk and environment, etc.
The outcome of the Board evaluation for financial year 2016-17 was discussed by the Board Governance, Nomination and Compensation Committee and the Board at their meeting held in April 2017. The Board has received consistent ratings on its overall effectiveness and has been rated comparatively higher this year for composition of Directors and their skills, attributes and experience. The Board has also noted areas requiring more focus in the future.
Policy on Directorâs Appointment and Remuneration
V he Board Governance, Nomination & Compensation Committee has framed a policy for selection and appointment of Directors including determining qualifications and independence of a Director, Key Managerial Personnel, Senior Management Personnel and their remuneration as part of its charter and other matters provided under Section 178(3) of the Companies Act, 2013. The policy covering these requirements is provided in the Corporate Governance report at page no. 115 to this Annual Report. We affirm that the remuneration paid to Directors is as per the remuneration policy of the Company.
Vigil Mechanism
Your Company has adopted an Ombuds process as a channel for receiving and redressing complaints from employees and Directors, as per the provisions of Section 177(9) and (10) of the Companies Act, 2013 and regulation 22 of the Listing Regulations.
Under this policy, your Company encourages its employees to report any fraudulent financial or other information to the stakeholders, and any conduct that results in violation of the Companyâs code of business conduct, to the management (on an anonymous basis, if employees so desire). Further, your Company has prohibited discrimination, retaliation or harassment of any kind against any employees who, based on the employeeâs reasonable belief that such conduct or practice have occurred or are occurring, reports that information or participates in the investigation.
Mechanism followed under Ombuds process is appropriately communicated within the Company across all levels and has been displayed on the Companyâs intranet and website at www.wipro.com.
The Audit, Risk and Compliance Committee periodically reviews the functioning of this mechanism. No personnel of the Company were denied access to the Audit, Risk & Compliance Committee.
Related Party Transactions
Your Company has historically adopted the practice of undertaking related party transactions only in the ordinary and normal course of business and at armâs length as part of its philosophy of adhering to highest ethical standards, transparency and accountability. In line with the provisions of the Companies Act, 2013 and the Listing Regulations, the Board has approved a policy on related party transactions. An abridged policy on related party transactions has been placed on the Companyâs website www.wipro.com.
Ill. Related Party Transactions are placed on a quarterly basis before the Audit, Risk and Compliance Committee and before the Board for approval. Prior omnibus approval of the Audit, Risk and Compliance Committee is obtained for the transactions which are of a foreseeable and repetitive nature.
The particulars of contracts or arrangements with related parties referred to in section 188(1) and applicable rules of the Companies Act, 2013 in Form AOC-2 is provided as Annexure I to this Annual Report.
Compliance Management Framework
Vour Company has a robust and effective framework for monitoring compliances with applicable laws. The Board has approved a Global Statutory Compliance Policy providing guidance on broad categories of applicable laws and process for monitoring compliance. In furtherance to this, your Company has instituted an online compliance management system within the organization to monitor compliances and provide updates to senior management and Board on a periodic basis. The Audit, Risk and
Compliance Committee and the Board periodically monitor status of compliances with applicable laws based on quarterly certification provided by senior management.
Directorsâ Responsibility Statement
Your Directors hereby confirm that:
(a) i n the preparation of the annual accounts, the applicable accounting standards have been followed along with proper explanation relating to material departures;
(b) t he Directors have selected such accounting policies and applied them consistently and made judgments and estimates that are reasonable and prudent so as to give a true and fair view of the state of affairs of the Company at the end of the financial year and of the profit and loss of the Company for that period;
(c) V he Directors have taken proper and sufficient care for the maintenance of adequate accounting records in accordance with the provisions of the Companies Act, 2013 for safeguarding the assets of the Company and for preventing and detecting fraud and other irregularities;
(d) V he Directors have prepared the annual accounts on a going concern basis; and
(e) V he Directors, have laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively;
(f) v s required under Section 134(5)(f) of the Companies Act, 2013, and according to the information and explanations presented to us, based on the review done by the Audit, Risk and Compliance Committee and as recommended by it, we, the Board, hereby, state that adequate systems and processes, commensurate with the size of the Company and the nature of its business, have been put in place by the Company, to ensure compliance with the provisions of all applicable laws as per the Companyâs Global Statutory Compliance Policy and that such systems and processes are operating effectively.
Wipro Employee Stock Option Plans (WESOP)/ Restricted Stock Unit Plans
In order to motivate, incentivize and reward employees, your Company has instituted various employee stock options plans/restricted stock unit plans from time to time. The Board Governance, Nomination and Compensation Committee administers these plans. The stock option plans are in compliance with Securities and Exchange Board of India (Share Based Employee Benefits) Regulations, 2014 (âEmployee Benefits Regulationsâ) and there have been no material changes to these plans during the financial year. Disclosures on various plans, details of options granted, shares allotted upon exercise, etc. as required under the Employee Benefits Regulations read with Securities and Exchange Board of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015 are available on the Companyâs website at http://www.wipro.com/ investors/financial-information/annual-reports/. No employee was issued stock option during the year equal to or exceeding 1% of the issued capital of the Company at the time of grant.
W ipro Equity Reward Trust (WERT) is an ESOP Trust set up by your Company. Pursuant to approval by the shareholders at their meeting held in July 2014, the Company is authorized to transfer shares from the WERT to employees on exercise of vested Indian RSUs.
Particulars of Employees
Information required pursuant to Section 197(12) of the Companies Act, 2013 read with Rule 5(1) of the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure II to this report.
statement containing, inter alia, the names of top ten employees in terms of remuneration drawn and every employee employed throughout the financial year and in receipt of remuneration of Rs, 102 lakhs or more, and employees employed for part of the year and in receipt of Rs, 8.50 lakhs or more per month, pursuant to Rule 5(2) the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014 is provided as Annexure III to this report.
V. Internal Financial Controls and Audit Internal Financial Controls and their Adequacy
P he Board of your Company has laid down internal financial controls to be followed by the Company and that such internal financial controls are adequate and operating effectively. Your Company has adopted policies and procedures for ensuring the orderly and efficient conduct of its business, including adherence to the Companyâs policies, the safeguarding of its
assets, the prevention and detection of frauds and errors, the accuracy and completeness of the accounting records, and the timely preparation of reliable financial disclosures.
Risk Management
Given the diversified scale of operations, your Company has put in place an Enterprise Risk Management (ERM) framework and adopted an enterprise risk management policy based on globally recognized standards. The ERM framework is administered by the Audit, Risk and Compliance Committee. The objective of the ERM framework is to enable and support achievement of business objectives through risk-intelligent assessment while also placing significant focus on constantly identifying and mitigating risks within the business.
further details on the Companyâs risk management framework is provided in the MD&A report.
Statutory Auditors
Pursuant to the provisions of section 139 of the Companies Act, 2013, an audit firm can act as auditors of a listed company for a maximum tenure of two terms of 5 consecutive years. For the purpose of reckoning this limit, existing tenure of the auditors needs to be counted. Further, companies have been given a transition time of 3 years from April 1, 2014 to comply with this provision.
As per the above requirement, the term of Companyâs auditors, BSR & Co. LLP, (Registration No.101248W/W-100022) Chartered Accountants, Bangalore, comes to an end with the conclusion of audit for the financial year 2016-17.
After conducting a detailed evaluation and based on the recommendation of Audit, Risk and Compliance Committee, the Board approved the proposal for placing at the 71st AGM the matter of appointment of Deloitte Haskins & Sells LLP, Chartered Accountants (Registration No. 1 17366W/W-100018) as statutory auditors of the Company for a term of 5 years from the financial year 2017-18 onwards on such terms and conditions and remuneration as may be decided by the Audit, Risk and Compliance Committee. A resolution to that effect forms part of notice of the 71st AGM sent along with this Annual Report.
Auditorsâ Report
P here are no qualifications, reservations or adverse remarks made by BSR & Co. LLP, Statutory Auditors, in their report for the financial year ended March 31, 2017.
Pursuant to provisions of section 143(12) of the Companies Act, 2013, the Statutory Auditors have not reported any incident of fraud to the Audit, Risk and Compliance Committee during the year under review.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013 and the Companies (Appointment and Remuneration of Managerial Personnel) Rules, 2014, the Company has appointed Mr. V Sreedharan, Partner, V Sreedharan & Associates, a firm of Company Secretaries in Practice, to conduct Secretarial Audit of the Company. Report of the Secretarial Audit in Form MR-3 for the financial year ended March 31, 2017 is enclosed as Annexure IV to the Report. There are no qualifications, reservations or adverse remarks made by the Secretarial Auditor in his report.
V. Social Responsibility and Sustainability
Corporate Social Responsibility
Your Company is at the forefront of Corporate Social Responsibility (CSR) and sustainability initiatives and practices. Your Company believes in making lasting impact towards creating a just, equitable, humane and sustainable society. Your Company has been involved with social initiatives for more than decade and a half and engages in various activities in the field of education, primary healthcare and communities, ecology and environment, etc. Your Company has won several awards and accolades for its CSR and sustainability efforts.
Ys per the provisions of the Companies Act, 2013, companies having net worth of Rs, 500 crore or more, or turnover of Rs, 1,000 crore or more or net profit of Rs,5 crore or more during any financial year are required to constitute a Corporate Social Responsibility (CSR) committee of the board comprising three or more directors, at least one of whom should be an independent director and such company shall spend at least 2% of the average net profits of the companyâs three immediately preceding financial years towards CSR activities. Accordingly, your Company spent Rs, 1,863 million towards CSR activities during the financial year 2016-17. The contents of the CSR policy and CSR Report for the year 2016-17 is attached as Annexure V to this report. Contents of the CSR policy is also available on the Companyâs website at http://www.wipro.com/investors/corporate-governance/policies-and-guidelines/. The terms of reference of CSR committee, framed in accordance with Section 135 of the Companies Act, 2013, forms part of Board Governance, Nomination and Compensation Committee. The Committee consists of three independent directors, Dr. Ashok S Ganguly, Mr. N Vaghul and Mr. William Arthur Owens, as its members. Dr. Ashok S Ganguly is the Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and Development and Technology Absorption
details of steps taken by your Company to conserve energy through its âSustainabilityâ initiatives, Research and Development and Technology Absorption have been disclosed as part of the MD&A Report.
VI. Other Disclosures
Foreign Exchange Earnings and Outgoings
During the year 2016-17, your Companyâs foreign exchange earnings were '' 404,000 million and foreign exchange outgoings were '' 212,910 million as against '' 404,862 million of foreign exchange earnings and '' 208,181 million of foreign exchange outgoings for the financial year 2015-16.
Extract of Annual Return
pursuant to section 92(3) and section 134(3)(a), extract of the Annual Return as on March 31, 2017 in form MGT-9 is enclosed as Annexure VI to this report.
Paternal Changes and Commitments Affecting the Financial Position of the Company
D here have been no material changes and commitments, affecting the financial position of the Company which occurred during between the end of the financial year to which the financial statements relate and the date of this report.
Details of Significant and Material Orders Passed by the regulators/Courts/Tribunals Impacting the Going Concern Status and the Companyâs Operations in Future
D here are no significant material orders passed by the Regulators/Courts which would impact the going concern status of the Company and its future operations.
Information Required Under Sexual Harassment of Women at Work place (Prevention, Prohibition & Redressal) Act, 2013
Your Company has a policy and framework for employees to report sexual harassment cases at workplace and the process ensures complete anonymity and confidentiality of information. Adequate workshops and awareness programmes against sexual harassment are conducted across the organization. A total of 116 complaints of sexual harassment were raised in the calendar year 2016, of which 102 cases were disposed and appropriate actions were taken in all cases within the statutory timelines.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers, shareholders, suppliers, bankers, business partners/associates, financial institutions and Central and State Governments for their consistent support and encouragement to the Company. I am sure you will join our Directors in conveying our sincere appreciation to all employees of the Company and its subsidiaries and associates for their hard work and commitment. Their dedication and competence has ensured that the Company continues to be a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors,
Bangalore Azim H Premji
June 2, 2017 Executive Chairman
Mar 31, 2016
On behalf of the Board of Directors (the "Board"), it gives me great
pleasure to present the 70th Board''s Report of your Company, along with
the Balance Sheet, Profit and Loss account and Cash Flow statements,
for the financial year ended March 31, 2016.
I. Financial Performance
On a consolidated basis, our sales increased to Rs.512,478 million for
the current year as against Rs.469,510 million in the previous year,
recording a growth of 9.15%. Our net profits increased to Rs.89,597
million for the current year as against Rs. 86,609 million in the
previous year, recording a growth of 3.45%.
On a standalone basis, our sales increased to Rs.446,846 million for
the current year as against Rs.412,098 million in the previous year,
recording a growth of 8.43%. Our net profits remained largely stable
for the current year as against the net profits of the previous year.
The standalone financial statements prepared in accordance with Indian
GAAP and consolidated financial statements prepared in accordance with
Indian GAAP as well as IFRS for the financial year ended March 31, 2016
forms part of this Annual Report. Key highlights of financial
performance of your Company for the financial year 2015-16 are provided
below:
(Rs. in Millions)
Standalone Consolidated
2015-16 2014-15 2015-16 2014-15
Sales and Other Income 474,561 437,088 540,965 494,007
Profit before Tax 104,821 105,570 115,247 112,241
Provision for Tax 23,831 23,639 25,158 25,101
Minority Interest - - (492) (531)
Net profit for the
year* 80,990 81,931 89,597 86,609
Appropriations
Interim Dividend 12,352 12,353 12,278 12,276
Proposed Dividend on
equity shares 2,471 17,283 2,456 17,179
Corporate tax on
distributed dividend 3,085 5,924 3,085 5,924
Transfer to General
Reserve - 8,193 - 8,193
EPS
Basic 32.97 33.38 36.47 35.28
Diluted 32.91 33.28 36.40 35.18
* profit for the standalone results is after considering a loss of Rs.
523 Million (2015: Profit of Rs. 390 million) relating to changes in
fair value of forward contracts designated as hedges of net investment
in non-integral foreign operations, translation of foreign currency
borrowings and changes in fair value of related cross currency swaps
together designated as hedges of net investment in non- integral
foreign operations. In the Consolidated Accounts, these are considered
as hedges of net investment in non-integral foreign operations and are
recognized directly in shareholders'' fund.
Dividend
Your Directors recommend a final dividend of Rs.1/- per equity share of
face value of Rs.2/- each to be appropriated from the profits of the
Company for the financial year 2015-16, subject to the approval of the
shareholders at the ensuing Annual General Meeting.
Pursuant to the approval of the Board on January 18, 2016, your Company
distributed an interim dividend of Rs.5/- per equity share of face
value of Rs.2/- each, to shareholders who were on the register of
members as on closing hours of January 27, 2016, being the record date
fixed for this purpose.
The total dividend for the year ended March 31, 2016 would accordingly
be Rs.6/- per equity share of face value of Rs.2/- each.
During the year 2015-16, unclaimed Dividend for financial year 2007-08
of Rs.5,094,480/- was transferred to the Investor Education and
Protection Fund, as required under the Investor Education and
Protection Fund (Awareness and Protection of Investor) Rules, 2001.
Buyback of Equity Shares
On April 20, 2016, the Board approved a proposal to buyback up to
4,00,00,000 equity shares of the Company for an aggregate amount not
exceeding Rs. 25,00,00,00,000, being 1.62% of the total paid up equity
share capital, at Rs. 625 per equity share. The buyback is proposed to
be made from all existing shareholders of the Company on May 6, 2016,
being the record date for the buyback, on a proportionate basis under
the tender offer route in accordance with the provisions contained in
the Securities and Exchange Board of India (Buy Back of Securities)
Regulations, 1998 and the Companies Act, 2013 and rules made
thereunder.
Transfer to Reserves
Appropriations to general reserve for the financial year ended March
31, 2016 as per standalone and consolidated financial statements are as
under:
Rs. In millions
Standalone Consolidated
Net profit for the year 80,990 89,597
Balance of Reserves at the 341,279 365,983
beginning of the year
Transfer to General Reserve - -
Balance of Reserves at the 404,111 441,945
end of the year
Subsidiary Companies
In accordance with Section 129(3) of the Companies Act, 2013, a
statement containing salient features of the financial statements of
the subsidiary companies in Form AOC-1 is provided at pages 214-215 of
this Annual Report.
In accordance with third proviso to Section 136(1) of the Companies
Act, 2013, the Annual Report of your Company, containing inter alia the
audited standalone and consolidated financial statements, has been
placed on the website of the Company at www.wipro.com. Further,
audited financial statements together with related information and
other reports of each of the subsidiary companies have also been placed
on the website of the Company at www.wipro.com.
During the financial year 2015-16, your Company invested an aggregate
of Rs. 3,207 million in its direct subsidiaries. Apart from this, your
Company funded its subsidiaries, from time to time, as per the fund
requirements, through loans, guarantees and other means to meet working
capital requirements.
During the year 2015-16, Wipro Technologies Spain S.L., a
non-operational entity, was liquidated. Wipro Promax Holdings Pty Ltd
and Wipro Promax IP Pty Ltd, non-operational entities, applied for
de-registration as at March 31, 2016. Also, during the year, Wipro
Europe SARL and SAS Wipro France were merged with New Logic
Technologies SARL, France. Further, to enhance operational and
financial efficiencies, Data Centre Services Operations Business of
Infocrossing Inc., was transferred to Wipro Data Centre & Cloud
Services, Inc., a wholly-owned subsidiary of Wipro LLC. Consequent to
re-organization, Wipro Promax Analytics Solutions LLC, which was
earlier a subsidiary of Wipro LLC, has now become a subsidiary of Wipro
Gallagher Solutions Inc.
Share Capital
During the year 2015-16, the Company allotted 16,70,252 equity shares
of Rs.2 each pursuant to exercise of stock options. Consequently, the
paid up equity share capital of the Company stood at Rs. 4,94,14,26,580
consisting of 2,47,07,13,290 equity shares of Rs.2 each.
During the year under review, the Company has not issued shares with
differential voting rights and sweat equity shares.
Particulars of Loans, Advances, Guarantees and Investments
Pursuant to section 186 of Companies Act, 2013 and Schedule V of the
Securities and Exchange Board of India (Listing Obligations and
Disclosure Requirements) Regulations, 2015 ("Listing Regulations"),
disclosure on particulars relating to Loans, advances, guarantees and
investments are provided as part of the financial statements.
Deposits
Your Company has not accepted any deposits from public and as such, no
amount on account of principal or interest on public deposits was
outstanding as on the date of the balance sheet.
II. Business
Your Company is one of the leading providers of IT Services globally.
Your Company combines the business knowledge and industry expertise of
its domain specialists and the technical knowledge and implementation
skills of its delivery team leveraging its products, platforms,
partnerships and solutions in its development centers located around
the world.
Your Company develops and integrates Innovative Solutions that enable
its clients to leverage IT to achieve their business objectives at
competitive costs. Your Company uses quality processes and global
talent pool to deliver "time to development" advantages, cost savings
and productivity improvements.
Your Company''s IT Services business provides a range of IT and
IT-enabled services which include Digital Strategy Advisory, Customer
Centric Design, Technology Consulting, IT Consulting, Custom
Application Design, Development, Re-Engineering and Maintenance,
Systems Integration, Package Implementation, Global Infrastructure
Services, Analytics Services, Business Process Services, Research and
Development and Hardware and Software Design to Leading Enterprises
Worldwide. Your Company''s vision is "To earn our Clients'' trust and
maximize value of their businesses by providing solutions that
integrate deep industry insights, leading technologies and best in
class execution". The markets that your Company serves are undergoing
rapid changes due to the pace of developments in technology, innovation
in business models and changes in the sourcing strategies of clients.
Pressures on cost-competitiveness and an uncertain economic environment
are causing clients to develop newer business models. On the technology
front, Digital Business has changed the nature of demand for IT
services. Development of advanced technologies such as Cloud Based
Offerings, Big Data Analytics, Mobile Applications and the Emergence of
Social Media are shifting the point of decision-making on IT sourcing
within clients'' organization from the traditional Chief Information
Officer to newer stakeholders such as Chief Marketing Officer, Chief
Digital Officer, Chief Risk Officer etc. These trends on newer business
models, emerging technologies and sourcing patterns are expected to
provide Your Company with significant growth opportunities.
Your Company''s IT Products segment provides a range of third-party IT
products, which allows it to offer comprehensive IT System Integration
Services. These products include Computing, Platforms and Storage,
Networking Solutions, Enterprise Information Security, and software
products, including databases and operating systems. Your Company has a
diverse range of clients, primarily in the India and Middle East
markets from small and medium enterprises ("SMEs") to large enterprises
in all major industries.
Outlook
According to Strategic Review 2016 of the National Association of
Software and Service ("NASSCOM"), in FY16, IT export revenues from
India grew by 12.3% in constant currency, to an estimated $108 billion.
NASSCOM expects FY17 export growth rates to be between 10% and 12%.
According to NASSCOM Perspective 2025: Shaping the Digital Revolution,
the Indian technology and services industry is on track to reach $200
billion to $225 billion in revenues by 2020, from a base of $143
billion in 2016, and furthermore, to reach revenues of $350 billion by
2025.
Acquisitions and Investments
Acquisitions are a key enabler in driving growth and building
capability in industry domains, emerging technology areas, Digital and
increasing market footprint in newer markets. Your Company focuses on
opportunities where it can further develop its domain expertise,
specific skill sets and its Global Delivery Model to maximize service
and product enhancements and higher margins. Your Company also uses its
acquisition program to increase presence in select geographies,
increase footprint in certain large customers and pursue select
business opportunities. Key acquisitions consummated during the year
ended March 31, 2016 were Designit, a global strategic design firm
specializing in designing transformative product-services experiences;
Cellent AG, a leading IT Consulting and Software Services company
offering holistic IT solutions and services; and HPH Holdings
Corporation (HealthPlan Services), a leading technology and process as
a service provider in the US Health Insurance market.
In December 2015, your Company entered into an agreement to acquire
Viteos Group, a Business Process as a Service (BPaaS) provider for the
alternative investment management industry for a purchase consideration
of USD 130 million. The acquisition is subject to customary closing
conditions and regulatory approvals.
As part of a start-up engagement model, your Company has invested in
building a world class ecosystem through a US$ 100 million internal
venture capital fund, Wipro Ventures, aimed at investing in cutting
edge start-ups in areas such as Digital, Internet of Things (IoT), Big
data, Open source, Cybersecurity and Artificial Intelligence (AI). In
2015-16, Wipro Ventures has seen strong traction and scale. Your
Company has made 6 investments with a cumulative spend of US$ 15
million and a further committed spend of US$ 5 million in FY16 in
start-ups working in Big Data and Analytics, Artificial Intelligence,
the Internet of Things, Mobility, Cloud Infra, Fintech and Security -
technologies that are reshaping the future of enterprises.
Key Awards and Recognitions During the Year
Your Company is one of the most admired and recognized companies in the
IT industry. During the year, your Company won several awards and
accolades, out of which key recognitions are given below:
1. Wipro was recognized as a 2016 World''s Most Ethical Company® for
the fifth successive year by the Ethisphere Institute, the global
leader in defining and advancing the standards of ethical business
practices.
2. Wipro was awarded ''The ICSI National Award for Excellence in
Corporate Governance'' for 2015 by the Institute of Company Secretaries
of India (ICSI).
3. Wipro was awarded the ''NASSCOM Corporate Award for Excellence in
Diversity and Inclusion 2016'', in the category of ''Best Program for
Excellence in Gender Diversity'' for having institutionalized robust and
successful programs for driving and sustaining gender diversity
initiatives, policies and processes.
4. Wipro has been recognized as a member of the global Dow Jones
Sustainability Index for the sixth year in succession.
Management Discussion and Analysis Report
In terms of regulation 34 of the Listing Regulations, the Management
Discussion and Analysis report on your Company''s performance, industry
trends and other material changes with respect to your Company and its
subsidiaries, wherever applicable, are presented from pages 24 to 64 of
this Annual Report. The MD&A report provides a consolidated perspective
of economic, social and environmental aspects material to our strategy
and our ability to create and sustain value to our key stakeholders and
includes aspects of reporting as required by Regulation 34 of the
Listing Regulations with Stock Exchange on Business Responsibility
Report. Therefore, no separate section on Business Responsibility
Report is published.
III. Governance and Ethics
Corporate Governance
Your Company believes in adopting best practices of corporate
governance. Corporate governance principles are enshrined in the Spirit
of Wipro, which form the core values of Wipro. These guiding principles
are also articulated through the Company''s code of business conduct,
corporate governance guidelines, charter of various sub-committees and
disclosure policy.
As per regulation 34 of the Listing Regulations, a separate section on
corporate governance practices followed by your Company, together with
a certificate from V. Sreedharan & Associates, Company Secretaries, on
compliance with corporate governance norms under the Listing
Regulations, is given from page no. 109 onwards.
Board of Directors
Board''s Composition and Independence
Your Company''s Board consists of global leaders and visionaries who
provide strategic direction and guidance to the organization. As on
March 31, 2016, the Board comprised four executive directors and seven
non- executive Independent Directors.
Definition of ''Independence'' of Directors is derived from regulation 16
of the Listing Regulations, NYSE Listed Company Manual and Section
149(6) of the Companies Act, 2013. The Company has received necessary
declarations from the Independent Directors stating that they meet the
prescribed criteria for independence.
Based on the confirmations/disclosures received from the Directors
under section 149(7) of the Companies Act 2013 and on evaluation of the
relationships disclosed, the following Non-Executive Directors are
considered as Independent Directors:
a) Mr. N Vaghul
b) Mr. M K Sharma
c) Dr. Ashok S Ganguly
d) Dr. Jagdish N Sheth
e) Ms. Ireena Vittal
f) Mr. William Arthur Owens
g) Mr. Vyomesh Joshi
Further, Dr. Patrick J Ennis and Mr. Patrick Dupuis were appointed as
Independent Directors with effect from April 1, 2016.
Number of Meetings of the Board
The Board met six times during the financial year 2015-16 on April 20,
2015, June 3, 2015, July 22-23, 2015, October 20-21, 2015, January 4,
2016, and January 16-18, 2016. The maximum interval between any two
meetings did not exceed 120 days.
Directors and Key Managerial Personnel
Pursuant to the recommendation of Board Governance, Nomination and
Compensation Committee, the Board at its meeting held on April 20, 2015
approved, subject to members'' approval, re-appointment of Mr. Azim H
Premji as Executive Chairman and Managing Director from July 31, 2015
to July 30 2017 and appointment of Mr. Rishad Premji as Wholetime
Director for a period of 5 years with effect from May 1, 2015. The
aforesaid appointments were approved by the members at the 69th Annual
General Meeting held on July 22, 2015.
Pursuant to the recommendation of Board Governance, Nomination and
Compensation Committee, the Board at its meeting held on January 4,
2016 approved, subject to members'' approval, re-appointment of Mr. T K
Kurien as Executive Director designated as Executive Vice Chairman from
February 1, 2016 to March 31, 2017 and appointment of Mr. Abidali Z
Neemuchwala as Executive Director designated as Chief Executive Officer
for a period of 5 years with effect from February 1, 2016.
On March 11, 2016, Dr. Patrick J Ennis was appointed as an Additional
Director, to serve on the Board as an independent member effective
April 1, 2016. Further, on March 29, 2016, Mr. Patrick Dupuis was
appointed as an Additional Director, to serve on the Board as an
independent member with effect from April 1, 2016.
At the 68th Annual General Meeting held on July 23, 2014, Mr. N Vaghul
and Dr. Ashok S Ganguly were appointed as Independent Directors to hold
office up to July 31, 2016 and Mr. M K Sharma was appointed as
Independent Director to hold office up to June 30, 2016. Considering
their immense contributions to the Company and pursuant to the
recommendation of Board Governance, Nomination and Compensation
Committee, the Board at its meeting held on April 20, 2016 appointed
Mr. M K Sharma as Additional Director with effect from July 1, 2016 and
decided to place the proposal for re-appointment of Mr. N Vaghul and
Dr. Ashok S Ganguly as Independent Directors for a further term of 3
years up to July 31, 2019 and Mr. M K Sharma as Independent Director
for a further term of 5 years up to June 30, 2021, for approval of the
members at the 70th Annual General Meeting. The term of office of Dr.
Jagdish N Sheth expires on July 18, 2016.
The Company has received separate notices under section 160 from
members, along with the requisite deposit, signifying their intention
to propose appointment/re- appointment of Mr. T K Kurien, Mr. Abidali
Z Neemuchwala, Dr. Patrick J Ennis, Mr. Patrick Dupuis, Mr. N Vaghul,
Dr. Ashok S Ganguly and Mr. M K Sharma as mentioned in the preceding
paragraphs. Accordingly, necessary resolutions are being placed for
approval of the members at the 70th Annual General Meeting of the
Company.
Pursuant to provisions of section 152 and Articles of Association of
the Company, Mr. Rishad Premji will retire by rotation at the 70th
Annual General Meeting and being eligible, has offered himself for
re-appointment.
Mr. Jatin P Dalal was appointed as the Chief Financial Officer of the
Company with effect from April 1, 2015 and Mr. M Sanaulla Khan was
appointed as the Company Secretary of the Company with effect from June
3, 2015.
Committees of the Board
The Company''s Board has the following committees:
1. Audit, Risk and Compliance Committee
2. Board Governance, Nomination and Compensation Committee, also acts
as CSR Committee
3. Strategy Committee
4. Administrative and Shareholders/Investors Grievance Committee
(Stakeholders'' Relationship Committee)
Details of terms of reference of the Committees, Committee membership
and attendance at meetings of the Committees are provided in the
Corporate Governance report from page no. 113 onwards.
Board Evaluation
Pursuant to the provisions of the Companies Act, 2013 and the Listing
Regulations, the Board is required to monitor and review the Board
evaluation framework. In line with the Corporate Governance Guidelines,
Annual Performance Evaluation is conducted for all Board Members as
well as the working of the Board and its Committees. This evaluation is
led by the Chairman of the Board Governance, Nomination and
Compensation Committee with specific focus on the performance and
effective functioning of the Board. The evaluation process also
considers the time spent by each of the Board Member, core
competencies, personal characteristics, accomplishment of specific
responsibilities and expertise. The Board evaluation is conducted
through questionnaire having qualitative parameters and feedback based
on ratings. The outcome of the Board evaluation for financial year
2015-16 was discussed by the Board Governance, Nomination and
Compensation Committee and the Board at their meeting held in April
2016.
Policy on Director''s Appointment and Remuneration
The Board Governance, Nomination & Compensation Committee has framed a
policy for selection and appointment of Directors including determining
qualifications and independence of a Director, Key Managerial
Personnel, Senior Management Personnel and their remuneration as part
of its charter and other matters provided under Section 178(3) of the
Companies Act, 2013. The policy covering these requirements is provided
in the Corporate Governance report at page no. 111. We affirm that the
remuneration paid to Directors is as per the remuneration policy of the
Company.
Vigil Mechanism
In line with the requirements under Section 177(9) and (10) of the
Companies Act, 2013 and regulation 22 of the Listing Regulations, your
Company has adopted an Ombuds process which is a channel for receiving
and redressing complaints from employees and directors. Under this
policy, your Company encourages its employees to report any reporting
of fraudulent financial or other information to the stakeholders, and
any conduct that results in violation of the Company''s code of business
conduct, to the management (on an anonymous basis, if employees so
desire).
Likewise, under this policy, your Company has prohibited
discrimination, retaliation or harassment of any kind against any
employees who, based on the employee''s reasonable belief that such
conduct or practice have occurred or are occurring, reports that
information or participates in the investigation.
Mechanism followed under Ombuds process is appropriately communicated
within the Company across all levels and has been displayed on the
Company''s intranet and website at www.wipro.com.
The Audit, Risk and Compliance Committee periodically reviews the
functioning of this mechanism. No personnel of the Company was denied
access to the Audit, Risk & Compliance Committee.
Related Party Transactions
As a part of its philosophy of adhering to highest ethical standards,
transparency and accountability, your Company has historically adopted
the practice of undertaking related party transactions only in the
ordinary and normal course of business and at arm''s length. In line
with the provisions of the Companies Act, 2013 and the Listing
Regulations, the Board has approved a policy on related party
transactions. An abridged policy on related party transacations has
been placed on the Company''s website.
All Related Party Transactions are placed on a quarterly basis before
the Audit, Risk and Compliance Committee and also before the Board for
approval. Prior omnibus approval of the Audit, Risk and Compliance
Committee is obtained for the transactions which are of a foreseeable
and repetitive nature.
The particulars of contracts or arrangements with related parties
referred to in section 188(1) and applicable rules of the Companies
Act, 2013 in Form AOC-2 is provided as Annexure I at page no. 74 of
this Annual Report.
Compliance Management Framework
Your Company has a robust and effective framework for monitoring
compliances with applicable laws. The Board has approved a Global
Statutory Compliance Policy providing guidance on broad categories of
applicable laws and process for monitoring compliance. In furtherance
to this, your Company has instituted an online compliance management
system within the organization to monitor compliances real-time and
provide update to senior management and Board on a periodic basis. The
Audit, Risk and Compliance Committee and the Board periodically monitor
status of compliances with applicable laws based on quarterly
certification provided by senior management.
Directors'' Responsibility Statement
Your Directors hereby confirm that:
(a) in the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(b) the Directors have selected such accounting policies and applied
them consistently and made judgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profit and
loss of the Company for that period;
(c) the Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of the Companies Act, 2013 for safeguarding the assets of
the Company and for preventing and detecting fraud and other
irregularities;
(d) the Directors have prepared the annual accounts on a going concern
basis; and
(e) the Directors, have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and operating effectively;
(f) As required under Section 134(5)(f) of the Companies Act, 2013, and
according to the information and explanations presented to us, based on
the review done by the Audit, Risk and Compliance Committee and as
recommended by it, we, the Board, hereby, state that adequate systems
and processes, commensurate with the size of the Company and the nature
of its business, have been put in place by the Company, to ensure
compliance with the provisions of all applicable laws as per the
Company''s Global Statutory Compliance Policy and that such systems and
processes are operating effectively.
Wipro Employee Stock Option Plans (WESOP)/ Restricted Stock Unit Plans
In order to motivate, incentivize and reward employees, your Company
has instituted various employee stock options plans/restricted stock
unit plans from time to time. The Board Governance, Nomination and
Compensation Committee administers these plans. The stock option plans
are in compliance with Securities and Exchange Board of India (Share
Based Employee Benefits) Regulations, 2014 ("Employee Benefits
Regulations") and there have been no material changes to these plans
during the financial year. Disclosures on various plans, details of
options granted, shares allotted upon exercise, etc. as required under
Employee Benefits Regulations read with Securities and Exchange Board
of India circular no. CIR/CFD/POLICY CELL/2/2015 dated June 16, 2015
are available on the Company''s website at
http://www.wipro.com/investors/ financial-information/annual-reports/.
No employee was issued stock option during the year equal to or
exceeding 1% of the issued capital of the Company at the time of grant.
Wipro Equity Reward Trust (WERT) is an ESOP Trust set up by your
Company. Pursuant to approval by the shareholders at their meeting held
in July 2014, the Company is authorized to transfer shares from the
WERT to employees on exercise of vested Indian RSUs.
Particulars of Employees
Information required pursuant to Section 197 (12) of the Companies Act,
2013 read with Rule 5(1) of The Companies (Appointment and Remuneration
of Managerial Personnel) Rules, 2014 is provided as Annexure II to this
report.
A statement containing, inter alia, names of employees employed
throughout the financial year and in receipt of remuneration of Rs.60
lakhs or more, employees employed for part of the year and in receipt
of Rs.5 lakhs or more per month, pursuant to Rule 5(2) the Companies
(Appointment and Remuneration of Managerial Personnel) Rules, 2014 is
provided as Annexure III to this report.
IV. Internal Financial Controls and Audit
Internal Financial Controls and their Adequacy
The Board of your Company has laid down internal financial controls to
be followed by the Company and that such internal financial controls
are adequate and operating effectively. Your Company has adopted
policies and procedures for ensuring the orderly and efficient conduct
of its business, including adherence to the Company''s policies, the
safeguarding of its assets, the prevention and detection of frauds and
errors, the accuracy and completeness of the accounting records, and
the timely preparation of reliable financial disclosures.
Risk Management
Given the diversified scale of operations, your Company has put in
place an Enterprise Risk Management (ERM) framework and adopted an
enterprise risk management policy based on globally recognized
standards. The ERM framework is administered by the Audit, Risk and
Compliance Committee. The objective of the ERM framework is to enable
and support achievement of business objectives through risk-intelligent
assessment while also placing significant focus on constantly
identifying and mitigating risks within the business.
Further details on the Company''s risk management framework is provided
in the Management Discussion and Analysis report.
Statutory Auditors
Pursuant to the provisions of section 139 of the Companies Act, 2013,
an audit firm can act as auditors for a maximum tenure of two terms of
5 consecutive years. For the purpose of reckoning this limit, existing
tenure of the auditors needs to be counted. However, companies have
been given a transition time of 3 years from April 1, 2014 to comply
with this provision.
Accordingly, the Company''s auditors M/s BSR & Co. LLP, (Registration
No.101248W/W-100022) Chartered Accountants, Bangalore, who retire at
the ensuing Annual General Meeting, may continue as statutory auditors
for auditing financial statements for the financial year ending March
31, 2017. M/s BSR & Co. LLP have confirmed their eligibility and
willingness to accept office, if re-appointed. Based on the
recommendation of Audit, Risk and Compliance Committee, the Board has
approved the proposal for placing the matter of re-appointment of M/s
BSR & Co. LLP as statutory auditors to conduct audit of financial
statements for the financial year ending March 31, 2017 at the 70th
Annual General Meeting. A resolution to that effect forms part of
notice of the 70th Annual General Meeting sent along with this Annual
Report.
Auditors'' Report
There are no qualifications, reservations or adverse remarks made by
M/s BSR & Co. LLP, Statutory Auditors, in their report for the
financial year ended March 31, 2016.
Pursuant to provisions of section 143(12) of the Companies Act, 2013,
the Statutory Auditors have not reported any incident of fraud to the
Audit, Risk and Compliance Committee during the year under review.
Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and the Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Company has appointed Mr. V Sreedharan,
Partner, M/s V Sreedharan & Associates, a firm of Company Secretaries
in Practice, to conduct Secretarial Audit of the Company. The Report
of the Secretarial Audit in Form MR-3 for the financial year ended
March 31, 2016 is enclosed at Annexure IV to the Report. There are no
qualifications, reservations or adverse remarks made by the Secretarial
Auditor in his report.
V. Social Responsibility and Sustainability
Corporate Social Responsibility
Your Company is at the forefront of Corporate Social Responsibility
(CSR) and sustainability initiatives and practices. Your Company
believes in making lasting impact towards creating a just, equitable,
humane and sustainable society. Your Company has been involved with
social initiatives for more than decade and a half and engages in
various activities in the field of education, primary healthcare and
communities, ecology and environment, etc. Your Company has won several
awards and accolades for its CSR and sustainability efforts.
As per the provisions of the Companies Act, 2013, companies having net
worth of Rs.500 crore or more, or turnover of Rs.1000 crore or more or
net profit of Rs.5 crore or more during any financial year are required
to constitute a Corporate Social Responsibility (CSR) committee of the
board comprising three or more directors, at least one of whom should
be an independent director and such company shall spend at least 2% of
the average net profits of the company''s three immediately preceding
financial years. Accordingly, your Company spent Rs.1,598 million
towards CSR activities during the financial year 2015-16. The contents
of the CSR policy and CSR Report for the year 2015-16 is attached as
Annexure V to this report. Contents of the CSR policy is also available
on the Company''s website at
http://www.wipro.com/investors/corporate-governance/
policies-and-guidelines/.
The terms of reference of CSR committee, framed in accordance with
Section 135 of the Companies Act, 2013, forms part of Board Governance,
Nomination and Compensation Committee. The Committee consists of three
independent directors, Dr. Ashok S Ganguly, Mr. N Vaghul and Mr.
William Arthur Owens, as its members. Dr. Ashok S Ganguly is the
Chairman of the Committee.
Particulars Regarding Conservation of Energy and Research and
Development and Technology Absorption
Details of steps taken by your Company to conserve energy through its
"Sustainability" initiatives have been disclosed as part of this Annual
Report in Management Discussion and Analysis Report.
Your Company''s Research and Development ("R&D") initiatives continue to
focus on strengthening and extending its portfolio of IT services
across multiple new and emerging technology areas as well as in the
intersection of these technologies. Your Company is investing in
developing solutions and services around multiple advanced technology
areas (commercial wearables, smart robotics, autonomous vehicles,
augmented reality, virtual reality, etc.), co-innovating with customers
on emerging themes (Digital), enabling new customer experiences,
building its patent portfolio, shaping innovation culture by running a
number of initiatives to support and fund ideas and also by working
closely with partner/startups ecosystem, academia and expert networks
to bring cutting edge innovations to its customers.
Your Company has invested in these advanced technologies to strengthen
existing capabilities and enhance its platforms for rich customer
experience. For example, Wipro Sight solution uses advanced computer
vision based algorithms to analyze customer behavior in stores for
delivering enhanced in-store retail experience. These investments have
resulted in many solution enhancements and new capabilities, which are
unique and differentiated in the market. They have also led to multiple
patents being applied and granted. Your Company has filed for 514
patents across technology areas in the last financial year.
Your Company has extended the applicability of HOLMESTM (Wipro''s
Artificial Intelligence platform) to multiple domains and processes to
offer verticalised solutions to its customers.
Your Company has built a data discovery platform, which provides
pertinent business insights across the value chain of an industry
through pre-defined applications. Leveraging techniques like visual
sciences and story- telling with data, the data discovery platform
provides a unique value proposition around accelerating time to market
for insights resulting in better adoption of insight driven decision
making. Built using best of breed open source technologies, the data
discovery platform leverages techniques like machine learning, natural
language processing, visualization, stream computing, etc. to bring to
the life the hidden insights in large and diverse data sets.
Your Company has also built a Big Data Ready Enterprise, which is an
open sourced big data product aimed at addressing the complete
lifecycle of managing data across the enterprise data lake that makes
it possible to ingest, organize, enrich, process, analyze, govern and
extract data at a fast pace, thereby significantly accelerating the big
data implementation in a cost effective manner. The product is released
under the Apache Public License v2.0 and hosted on Github.
To drive open innovation efforts for its customers, Your Company is
driving many new age innovation initiatives through startups connects,
hackathons, ideathons, etc. Your Company is part of various industry
and startup forums including the NASSCOM Industry Partner Program
(NIPP) that connects promising startups with corporates, to enable
partnerships and growth. Your Company is working with various open
innovation intermediaries to tap into expert networks across the world
to complement our specialists on niche projects to solve complex
customer problems involving Artificial Intelligence, Next Gen
Architecture, Cognitive Systems etc. Your Company''s academic and
research partnerships exist across geographies.
Your Company is driving co-innovation with customers on emerging
themes, conducting joint research, proof of concepts (POC), pilots etc.
Some of the emerging areas include block chain, biometrics, new
architectures and smart devices.
The innovation incubation center, Technovation Center continues to play
a key role in helping customers design, conceptualize, and experience
by leveraging future of technologies, industry processes and consumer
behavior. The Technovation Center has now evolved into an experience
platform to demonstrate the Company''s solutions to its customers. Your
Company has started work on its new Technovation Center in Mountain
View, California, USA, which would cater predominantly to US & Canada
geography customers, when fully operational.
Your Company is also building solutions around next generation
robotics, drones and autonomous vehicles which combined with the
computer vision and cognitive capabilities can address various market
needs across industry verticals. Your Company is also working on
industrial and enterprise wearable solutions which help improve work
force productivity and safety requirements. Your Company has developed
a video and sensor based smart parking solution which is useful in a
smart city context to dynamically assess parking availability across
locations, reservation and demand based pricing. Your Company has
developed a smart healthcare solution called Wipro AssureCareTM which
helps track medication, vital parameters and is used in elderly Care,
home monitoring and clinical trials.
The research and development expenses for the years ended March 31,
2016, 2015 and 2014 were Rs.2,561 million, Rs.2,513 million and
Rs.2,660 million respectively.
VI. Other Disclosures
Foreign Exchange Earnings and Outgoings
During the year 2015-16, your Company''s foreign exchange earnings were
Rs. 404,862 million and foreign exchange outgoings wereRs. 208,181
million as againstRs. 367,665 million of Foreign Exchange earnings and
Rs. 194,308 million of Foreign Exchange outgoings for the financial
year 2014-15.
Extract of Annual Return
Pursuant to section 92(3) and section 134(3)(a), extract of the Annual
Return as on March 31, 2016 in form MGT-9 is enclosed as Annexure VI to
this report.
Material Changes and Commitments Affecting the Financial Position of
the Company
There have been no material changes and commitments, affecting the
financial position of the Company which occurred during between the end
of the financial year to which the financial statements relate and the
date of this report.
Details of Significant and Material Orders Passed by the
regulators/Courts/Tribunals Impacting the Going Concern Status and the
Company''s Operations in Future
There are no significant material orders passed by the Regulators/
Courts which would impact the going concern status of the Company and
its future operations.
Information Required Under Sexual Harassment of Women at Workplace
(Prevention, Prohibition & Redressal) Act, 2014
Your Company has a policy and framework for employees to report sexual
harassment cases at workplace and the process ensures complete
anonymity and confidentiality of information. Adequate workshops and
awareness programmes against sexual harassment are conducted across the
organization. A total of 111 complaints of sexual harassment were
raised in the year 2015, of which 107 cases were disposed and
appropriate actions were taken in all cases within the statutory
timelines. Further details are provided on page no. 37 of the Annual
Report.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions and Central and State Governments for their
consistent support and encouragement to the Company. I am sure you will
join our Directors in conveying our sincere appreciation to all
employees of the Company and its subsidiaries and associates for their
hard work and commitment. Their dedication and competence has ensured
that the Company continues to be a significant and leading player in
the IT Services industry.
For and on behalf of the Board of Directors
Bangalore Azim H Premji
June 3, 2016 Chairman
Mar 31, 2015
1. Dear Shareholders,
On behalf of the Board of Directors, I am happy to present the 69th
Report of the Board of Directors of your Company along with the Balance
Sheet, Profit and Loss Account and Cash Flow Statement for the year
ended March 31,2015.
2. Financial Performance
Key highlights of consolidated financial performance for Wipro and its
group companies and standalone financial results forWipro Limited for
the financial year 2014-15 are tabulated below:
(Rs.in Millions)
Standalone Consolidation
2014-15 2013-14 2014-15 2013-14
Sales and Other
Income 437,088 403,684 494,007 453,457
Profit before Tax 105,570 96,082 112,241 101,143
Provision for tax 23,639 22,208 25,101 21,234
Minority interest - - -531 -438
Net profit for
the year * 81,931 73,874 86,609 79,471
Appropriations
Interim Dividend 12,353 7,404 12,276 7,347
Proposed Dividend on
equity shares 17,283 12,332 17,179 12,248
Corporate tax on
distributed dividend 5,924 3,353 5,924 3,353
Transfer to General
Reserve 8,193 7,387 8,193 7,387
EPS
Basic 33.38 30.09 35.28 32.37
Diluted 33.28 30.01 35.18 32.29
*profit for the standalone results is after considering a gain of Rs. 390
Million (2014 :loss ofRs. 2,607 million) relating to changes in fair
value of forward contracts designated as hedges of net investment in
non-integral foreign operations, translation of foreign currency
borrowings and changes in fair value of related cross currency swaps
together designated as hedges of net investment in non-integral foreign
operations. In the Consolidated Accounts, these are considered as
hedges of net investment in non-integral foreign operations and are
recognized directly in shareholders''fund.
3. Management''s Discussion and Analysis Report
The Management''s Discussion and Analysis Report on Company''s
performance - industry trends and other material changes with respect
to the Company and its subsidiaries, wherever applicable, are presented
from pages 22 to 40 of this Annual Report.
4. State of Affairs of the Company
The State of Affairs of the Company is presented as part of Management
Discussion and Analysis Reportforming part of this Report at page no.
22.
5. Outlook
According to the National Association of Software and Service Companies
(NASSCOM) Strategic Review Report 2015, Revenues for fiscal year 2015
for the IT-BPM industry based in India is estimated to be US$146
billion, which would represent growth of approximately 13% over fiscal
year 2014. IT Export Revenues from India, including hardware, are
expected to have grown at a year-on-year rate of 12% in fiscial year
2015, driven by greater demands for social, mobile, analytics and cloud
based solutions. According to Gartner: forecast: Enterprise IT
Spending by Vertical Industry Market, Worldwide, 2013-2019, Q1 2015
Update, worldwide IT Services spending in 2014 was $948 billion, a
growth of 1.8% over the previous year.
6. Consolidated Results
Our Sales for the current year grew by 8.12% to Rs. 469,510 million and
our Profit for the year was Rs. 86,609 million, recording an increase of
8.98% over the previous year.
7. Consolidated Financial Statements
The Consolidated Financial Statements of the Company for the financial
year ended March 31, 2015, prepared in accordance with Indian GAAP as
well as IFRS forms part of this Annual Report.
8. Transfer to Reserves
The appropriations to General Reserve for the Financial Year ended
March 31,2015 as per consolidated and standalone financial statements
are:
Rs.In Mn
Standalone Consolidated
Net profit for the year 81,931 86,609
Balance of Reserve at the 288,627 316,357
beginning of theyear
Transfer to General Reserve 8,193 8,193
Balance of Reserve at the end 341,279 365,983
of theyear
9. Subsidiary companies
In accordance with Section 129(3) of the Companies Act, 2013, a
statement containing salient features of the financial statements of
the subsidiary companies in Form AOC1 is provided at page no. 208 of
the Annual Report.
In accordance with third proviso to Section 136(1) of the Companies
Act, 2013, the Annual Report of your Company, containing therein its
audited standalone and the consolidated financial statements has been
placed on the website of the Company at www.wipro.com Further, audited
financial statements together with related information and other
reports of each of the subsidiary companies, have also been placed on
the website of the Company at www.wipro.com.
10. Investments in direct subsidiaries and minority stake
During the year under review, your Company had invested an aggregate of
Rs. 4,127 Million as equity in its direct subsidiaries and in minority
shareholding as part of its acquisition strategy. Apart from this, your
Company had funded its subsidiaries, from time to time, as per the fund
requirements, through loans, guarantees and other means to meet working
capital requirements.
In August 2014, the Company acquired ATCO l-Tek Inc., the provider of
IT services to ATCO Group, a leading Canadian global utilities and
logistics company, which allows the Company to further strengthen its
positions in these industries. Your Company also makes strategic
minority investments in companies that operate in high-end and niche
technology areas including cloud, opensource, artificial intelligence,
advanced analytics and internet of things. During the year ended March
31, 2015, certain additional investments were made in Opera Solutions
LLC.a leading global big data science company headquartered in Jersey
City, New Jersey. In March 2015, your Company entered into a strategic
partnership and acquireda minority stake with Drivestream lnc.,a
leading Oracle cloud application systems integrator.
11. Number of meetings of the Board
The Board met four times in financial year 2014 viz., on, April 16-17,
2014, July 24, 2014, October 22, 2014 and January 16,2015.The maximum
interval between any two meetings did not exceed 120 days.
12. Board independence
Definition of''Independence''of Directors is derived from Clause 49 of
the Listing Agreement with Stock Exchanges, NYSE Listed Company Manual
and Section 149(6) of the Companies Act, 2013. Based on the
confirmation / disclosures received from the Directors under section
149(7) of the Companies Act 2013 and on evaluation of the relationships
disclosed, the following Non-Executive Directors are considered as
Independent Directors:-
a) Mr.N Vaghul
b) Mr. M. K. Sharma
c) Dr. AshokS Ganguly
d) Dr.JagdishNSheth
e) Ms. IreenaVittal
f) Mr. William Arthur Owens
g) Mr.Vyomesh Joshi
13. Directors and Key Managerial Personnel:
Mr. B C Prabhakar and Mr. Shyam Saran, did not desire for re-election
at the last Annual General Meeting of the Company held on July 23,2014
and ceased to be directors of the Company.
Dr. Henning Kagermann resigned as Director of the Company with effect
from June 30,2014.
During the year, Mr. Suresh C Senapaty, CFO and Executive Director
retired from the services of the Company on attaining his
superannuation effective close of business hours of March 31,2015.
Mr. V Ramachandran, resigned as Company Secretary of the Company with
effect from close of business hours of April 22,2015.
Your Directors place on record their sincere appreciation of the
valuable contribution made by the aforesaid Directors and Company
Secretary to the Company.
At the last Annual General Meeting of the Company held on July 23,
2014, Mr. N Vaghul, Dr. Ashok S Ganguly, Ms. IreenaVittal, Mr.
MKSharma, Mr.Vyomesh Joshi, Mr. William Arthur Owens and Dr. Jagdish N
Sheth were appointed as Independent Directors, for a specific tenure in
accordance with Section 149 of the Companies Act, 2013 and Clause 49 of
the Listing Agreement.
Mr. Azim H Premji is the Chairman and Managing Director (designated as
"Chairman) of the Company and Mr. T
K Kurien is the Chief Executive Officer and Executive Director.
Mr. Jatin P Dalai has been appointed as the Chief Financial Officer of
the Company with effect from April 1, 2015 and Mr. M Sanaulla Khan was
appointed as the Company Secretary of the Company with effect from June
3,2015.
Pursuanttothe recommendation of the Board Governance, Nomination and
Compensation Committee, Mr. Azim H Premji was reappointed by the Board
of Directors, subject to the approval of the shareholders, as the
Executive Chairman and Managing Director of the Company (designated
as"Executive Chairman") on April 21,2015 for a further period of two
years with effect from July 31,2015 to July 30, 2017.
Pursuanttothe recommendation of the Board Governance, Nomination and
Compensation Committee, Mr. Rishad Azim Premji was appointed
asWholeTime Director of the Company by the Board of Directors with
effect from May 1, 2015 for a period of five years, subject to the
approval of the shareholders.
14. Committees of the Board
The Company''s Board has the following Committees:
1. Audit/Risk and Compliance Committee
2. Board Governance, Nomination and Compensation Committee
3. Strategy Committee
4. Administrative and Shareholders/Investors Grievance Committee
(Stakeholders''Relationship Committee)
The details of the membership and attendance of the meetings of the
above Committees of the board are provided in the Corporate Governance
report on page no. 96 of the annual report.
15. Remuneration Policy
The Board Governance, Nomination & Compensation Committee framed a
policy for selection and appointment of Directors including determining
qualifications independence of a Director, Key Managerial Personnel,
Senior Management Personnel and their remuneration as part of its
charter and other matters provided under Section 178(3) of the
Companies Act, 2013. An extract of the policy covering these
requirements is provided in the Corporate Governance report at page no.
94.
16. Directors'' responsibility Statement
Your Directors hereby confirm that;
(a) In the preparation of the annual accounts, the applicable
accounting standards have been followed along with proper explanation
relating to material departures;
(b) The Directors have selected such accounting policies and applied
them consistently and madejudgments and estimates that are reasonable
and prudent so as to give a true and fair view of the state of affairs
of the Company at the end of the financial year and of the profitand
loss of the Company for that period;
(c) The Directors have taken proper and sufficient care for the
maintenance of adequate accounting records in accordance with the
provisions of this Act for safeguarding the assets of the Company and
for preventing and detecting fraud and other irregularities;
(d) The Directors have prepared the annual accounts on a going concern
basis; and
(e) The Directors, have laid down internal financial controls to be
followed by the Company and that such internal financial controls are
adequate and were operating effectively
(f) As required under Section 134(5)(f) of the Companies Act, 2013, and
according to the information and explanations presented to us, based on
the review done bytheAudit/Riskand Compliance Committee and as
recommended by it, we, the Board of Directors, hereby, state that
adequate systems and processes, commensurate with the size of the
Company and the nature of its business, have been put in place by the
Company, to ensure compliance with the provisions of all applicable
laws as per the Company''s Global Statutory Compliance Policy and that
such systems and processes are operating effectively.
17. Statutory Auditors
The Company''s auditors M/s BSR and Co. LLP, (Regd.
No.101248W/W-100022) Chartered Accountants, Bangalore who retire at the
ensuing Annual General Meeting, have confirmed their eligibility and
willingness to accept office, if re-appointed. The proposal for their
re-appointment is included in the notice for Annual General Meeting
sent herewith.
18. Auditors''report
There are no qualifications, reservations or adverse remarks made by
M/s BSR & Co. LLP, Statutory Auditors in their report for the Financial
Year ended March 31,2015.
The Statutory Auditors have not reported any incident of fraud to the
Audit Committee of the Company in the year under review.
19. Particulars of loans, guarantees or investments under Section 186
of the Companies Act, 2013
Disclosure on particulars relating to Loans, guarantees or investments
under Section 186 of the Companies Act 2013 is provided in page no. 163
to 168 as part of financial statements.
20. Particulars of contracts or arrangements with related parties
referred to in sub-section (1) of Section 188 in the prescribed form
The particulars of contracts or arrangements with related parties
referred to in Section 188(1), as prescribed in Form AOC-2ofthe rules
prescribed under Chapter IX relating to Accounts of Companies under the
Companies Act, 2013 is provided at page no. 63 of the Annual Report.
21. Particulars of loans, advances, investments outstanding during the
financial year
Disclosure on particulars relating to loans, advances and investments
outstanding during the financial year under Clause 32 of the Listing
Agreement is provided on page no. 233 as part of financial statements.
22. Material changes and commitments affecting the financial position
of the Company
There have been no material changes and commitments, affecting the
financial position of the Company which occurred during between the end
of the financial year to which the financial statements relate and the
date of this report.
23. Details of significant and material orders passed by the
regulators/ courts/ tribunals impacting the going concern status and
the Company''s operations in future
There are no significant material orders passed by the
Regulators/Courts which would impact the going concern status of the
Company and its future operations.
24. Dividend
Your Directors recommend a final Dividend of Rs. 7 /- per equity share of
Rs. 21- each to be appropriated from the profits of the Company for the
year 2014-15, subject to the approval of the shareholders at the
ensuing Annual General Meeting.
Pursuant to the approval of Board of Directors on January 16, 2015,
your Company had distributed an Interim Dividend of Rs. 5/- per share, of
face value of X 21- each, to shareholders, who were on the Register of
Members of the Company as on closing hours of January 23,2015, being
the record date fixed by the Board of Directors for this purpose.
The total dividend for the year ended March 31,2015 would accordingly
beRs. 12/- per equity share ofRs. 21- each.
During the year 2014-15, unclaimed Dividend of Rs. 4,921,287/- was
transferred to the Investor Education and Protection Fund.as required
underthe Investor Education and Protection Fund (Awareness and
Protection of Investor) Rules, 2001.
25. Particulars regarding Conservation of Energy
Your Company has taken several steps to conserve
energy through its"Sustainability"initiatives as disclosed separately
as part of this Annual Report. The information of Conservation of
Energy as required under Section 134(3)(m) of the Companies Act, 2013
read with Companies (Accounts) Rules, 2014 is not applicable to the
business segments which your Company operates. However, as part of
Business Responsibility Report on page no. 106 to this Annual Report,
your Company had provided details of steps taken in the areas of Energy
Conservation and other Sustainability Initiatives.
26. Particulars regarding Research and Development, Technology
Absorption
YourCompany''s Research and Development (R&D) initiatives continue to
focus on incubating and strengthening its portfolio of IT services
across multiple new and emerging technology areas as well as in the
intersection of these technologies.The R&D and technology innovation
agenda focuses on investing in developing solutions and services around
defined Advanced Technology Themes (Next Gen Automation, Smart Devices,
Al and Cognitive Systems, Next Generation Architecture, Human Machine
Interfaces and Software Defined Everything), co-innovating with
customers, building Wipro patent portfolio, shaping innovation culture
within the organization and Wipro''s startup and ecosystem connects.
Your Company has invested significantly in next gen automation across
IT and business process archetypes and have built IP assets in
auto/self-healing process performance and governance automation, rule
based task automation, intelligent robotics platforms, API automation
and basic tax engineering and automation. More than 400 people are
engaged in R&D in these areas. Some of the trademarks in these areas
include Fixomatic, SeviceNXT, Cloud CLM, InsightiX, PRESM etc. Your
Company have also filed certain patents in these areas. Your Company
have also developed an open source Artificial Intelligence platform
code named Wipro HOLMES. This is a generic cognitive computing platform
that enables development of Al applications such as digital virtual
agents, predictive systems, cognitive process automation, visual
computing applications, knowledge virtualisation, robotics and drones.
Your Company is building a Human Machine Interfaces ("HMI") platform
which would enable humans to converse with the system in natural
language on the specific domains. The platform also helps in generating
multi-modal reactions to human emotions. The Wipro ngGenie, my Advisor
provides next generation experiences by enabling Voice and Conversation
based advice based on deep domain knowledge. Wipro Retail Sense helps
enable virtual experiences with a compelling experience of touch &feel
through next generation human computer interactions that combine
virtual reality, holographic and haptic technologies to provide multi
modal digital experience & feedback. Your Company has created solutions
atthe intersection of cutting edge technologies using Computer Vision,
Robotics & Machine Learning technologies that solve key business
problems in Retail, Consumer Goods and Banking domains. Wipro Sight, a
comprehensive in-store analytics solution for the Retail and Consumer
Good industry combines the power of human sight with the speed of
computer vision, and enables processing and analysis of surveillance
data to empower retailers with a near real-time situational awareness,
enabling them to respond speedily to waiting customers, long queues,
unanticipated stock-outs and similar situations.The solution was
showcased at National Retail Federation-January 2015 at New York and
was recognized as one of the top 5 Innovations by the Retail Week
magazine.
The innovation incubation center, Technovation Center continues to play
a key role in helping customers design and conceptualise "change the
business" portfolio by leveraging future of technologies, industry
processes and consumer behavior.TheTechnovation Center has evolved into
a platform to ideate, experiment, develop and create disruptive
solutions that shape future of business at the intersection of
technologies.
Your Company''s research and development expenses for the years ended
March 31,2014 and 2015 wereRs. 2,660 Mn andRs. 2,513 Mn respectively for
our continuing operations.
27. Risk Management Policy
Disclosure indicating developmentand implementation of a RiskManagement
Policy is provided in the Management Discussion and Analysis Report
forming part of this Report.
28. Corporate Social Responsibility
As per the Companies Act, 2013, companies having net worth of Rs. 500
crore or more, or turnover of Rs. 1000 crore or more or net profit of Rs. 5
crore or more during any financial year are required to constitute a
Corporate Social Responsibility (CSR) Committee of the Board of
Directors comprising three or more directors, at least one of whom
should be an independent director and such company shall spend at least
2% of the average net profits of the company''s three immediately
preceding financial years. Accordingly, your Company spent Rs. 1,327 Mn
towards CSR activities in fiscal 2015. The contents of the CSR policy
and initiatives taken by the Company on Corporate Social Responsibility
during the year 2014-15 is attached as Annexure F to this Report and
contents of the CSR policy is available on our website atwww.wipro.com
The terms of reference of the Corporate Social Responsibility (CSR)
broadly comprises and forms part of Board Governance, Nomination and
Compensation Committee and these terms of reference are in accordance
with Section 135 of the Companies Act, 2013.The Committee comprises of
Dr. Ashok Ganguly, Mr. NVaghul and Mr. William Arthur Owens.
29. Share Capital
The paid up equity share capital of the Company as on March 31,2015 was
Rs. 4,938,086,076. During the year under review, the Company has not
issued shares with differential voting rights and sweat equity shares.
30. Wipro Employee Stock Option Plans (WESOP) / Restricted Stock Unit
Plans
Details of the shares issued under Employee StockOption Plan (ESOP),
and also the disclosures in compliance with Section 62 of the Companies
Act, 2013 and Rule 12 of Companies (Share Capital and Debentures)
Rules, 2014 and Securities and Exchange Board of India (Share Based
Employee Benefits) Regulations, 2014 and the Securities and Exchange
Board of India (Employee Stock Option Scheme and Employees Stock
purchase Scheme) Guidelines, 1999 are set out in the Annexure to this
report. No employee was issued Stock Option, during the year equal to
or exceeding 1% of the issued capital of the Company at the time of
grant.
31. Foreign Exchange Earnings and Outgoings
During the year, your Company has earned Foreign Exchange ofRs. 367,665
million and the outgoings in Foreign Exchange were Rs. 194,308 million.
32. Group
The names of the Promoters and entities comprising "group" (and their
shareholding) as defined under the Competition Act 2002 for the
purposes of Section 3(1)(e) (i) of SEBI (Substantial Acquisition of
Shares and Takeover) Regulations, 2011 include the following:
33. Board Evaluation
Pursuant to the provisions of the Companies Act, 2013, Clause 49 of the
Listing Agreement and in line with our corporate governance guidelines,
peer evaluation of all Board members, annual performance evaluation of
its own performance, as well as the evaluation of the working of its
Committees of the Board. This evaluation is led by the Chairman of the
Board Governance, Nomination and Compensation Committee with specific
focus on the performance and effective functioning of the Board. The
evaluation process also considers the time spent by each of the Board
members, core competencies, personal characteristics, accomplishment of
specific responsibilities and expertise.
34. Internal Control System and their adequacy
Your Company hasan Internal Control System commensurate with the size
of the Company and nature of its business and the complexities of its
operations. Your Company has adopted required COSO Framework (Committee
of Sponsoring Organizations oftheTreadway Commission) for evaluating
internal controls. This Framework provides five integrated components
of internal controls, namely. Control Environment, Risk Assessment,
Control Activity, Information and Communication and Monitoring.
Information Technology controls were document, assessed and tested
under the COBIT framework. The evaluation of internal controls was
carried out Enterprise Risk Management function of your Company.
35. Vigil Mechanism
The Company has adopted an Ombuds process which is a channel for
receiving and redressing of employees'' complaints.
Under this policy, we encourage our employees to report any reporting
of fraudulent financial or other information to the stakeholders, any
conduct that results in violation of the Company''s Code of Business
Conduct, to management (on an anonymous basis, if employees so desire).
Likewise, under this policy, we have prohibited discrimination,
retaliation or harassment of any kind against any employees who, based
on the employee''s reasonable belief that such conduct or practice have
occurred or are occurring, reports that information or participates in
the said investigation. No individual in the Company has been denied
access to the Audit/ Risk and Compliance Committee or its Chairman.
Mechanism followed under Ombudsmen process is appropriately
communicated within the Company across all levels and has been
displayed on Wipro''s intranet and on Wipro''s website at www.wipro.com
The Audit/Risk and Compliance Committee periodically reviews the
functioning of this mechanism.
This meets the requirement under Section 177(9) and (10) of the
Companies Act, 2013 and Clause 49 of the Listing Agreement.
No personnel of the Company were denied access to the Audit/Risk &
Compliance Committee.
36. Information required under sexual harassment of women at workplace
(prevention, prohibition & redressal) Act, 2014 Please refer page no.
108 of the Business Responsibility Report.
37. Secretarial Audit
Pursuant to the provisions of Section 204 of the Companies Act, 2013
and The Companies (Appointment and Remuneration of Managerial
Personnel) Rules, 2014, the Company has appointed Mr. VSreedharan,
Partner, M/sV Sreedharan & Associates, a firm of Company Secretaries in
Practice to undertake the Secretarial Audit of the Company. The Report
of the Secretarial Audit in Form MR 3 for the Financial Year ended
March 31, 2015 is annexed as Annexure G to the Report. There are no
qualifications, reservations or adverse remarks made by Secretarial
Auditor in his report.
38. Corporate Governance
As per Clause 49 of the Listing Agreement with the Stock Exchanges, a
separate section on corporate governance practices followed by your
Company, together with a certificate from V. Sreedharan & Associates,
Company Secretaries on compliance with Clause 49 of the Listing
Agreement with Indian Stock Exchanges. This certificate is given in
Page no. 105.
39. Business Responsibility Reporting
As per Clause 55 of the Listing Agreement with the Stock Exchanges, a
separate section on Business Responsibility Reporting forms an integral
part of this Report.
40. Particulars of Employees
The information required pursuantto Section 197 (12) of the Companies
Act, 2013 read with Rule 5(1) of The Companies (Appointmentand
Remuneration of Managerial Personnel) Rules, 2014 is provided as
Annexure HI to this Report.
A statement containing names of employees employed throughout
thefinancialyearand in receipt of remuneration of Rs. 60 lacs or more,
employees employed for part of the year and in receipt ofRs. 5 lac or
more per month, pursuantto Rule 5(2)The Companies (Appointmentand
Remuneration of Managerial Personnel) Rules, 2014 is provided as
Annexure H2 to this Report.
41. Deposits
The Company has not accepted any deposits from public and as such, no
amount on account of principal or interest on public deposits was
outstanding as on the date of the balance sheet.
42. Extract of Annual Return
The extract of the Annual Return of your Company as on March 31,2015 as
provided under sub-section (3) of Section 92 in the Form MGT 9 is
enclosed at page no. 48 as a part of the Directors''Report.
43. Green Initiatives
Electronic copies ofthe Annual Report 2014-15 and Notice of the 69th
Annual General Meeting are sentto all members whose email addresses are
registered with the Company/ Depository participant(s). For members who
have not registered their email addresses, physical copies of the
Annual Report 2014-15 and the Notice ofthe 69th Annual General Meeting
under Section 101 ofthe Companies Act, 2013 are sent in the permitted
mode. Members requiring physical copies can send a request to the
Company.
Your Company provides e-voting facility to all its members to enable
them to cast their votes electronically on all resolutions set forth in
the Notice. This is pursuant to the Section 108 ofthe Companies Act
2013 and Rule 20 of the Companies (Management and Administration)
Amendment Rules, 2015.
44. Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions and Central and State Governments for their
consistent support and encouragement to the Company. I am sure you will
join our Directors in conveying our sincere appreciation to all
employees of the Company and its subsidiaries and associates for their
hard work and commitment. Their dedication and competence has ensured
that the Company continues to be a significant and leading player in
the IT Services industry.
For and on behalf of the Board of Directors
Azim H Premji
Chairman
Bangalore, June 3,2015
Mar 31, 2014
Dear Shareholders,
The behalf of the Board of Directors, I am happy to present the 68th
Report of the Board of Directors of your Company along with the Balance
Sheet, Profit and Loss Account and Cash Flow Statement for the year
ended March 31st, 2014.
Financial Performance
Key aspects of consolidated financial performance for Wipro and its
group companies and standalone financial results for Wipro Limited for
the financial year 2013-14 are tabulated below:
(Rs.in Mns)
Consolidated Standalone
2013-14 2012-13 2013-14 2012-13
Sales and Other Income 453,457 388,705 403,684 345,518
Profit before Tax 101,143 78,688 96,082 72,051
Provision for tax 21,234 16,865 22,208 15,549
Minority interest - 438 - 322
Net profit for the year * 79,471 61,501 73,874 56,502
Appropriations
Interim Dividend 7,347 4,932 7,404 4,932
Proposed Dividend on
equity snares
Corporate tax on
distributed dividend
Transfer to General 7,387 5,650 7,387 5,650
Reserve
Balance Retained in
Statement of Profit and 146,187 97,051 121,769 78,371
Loss
* profit for the standalone results is after considering loss of ?
2,607 million [2013: ? (1,107)] relating to changes in fair value of
forward contracts designated as hedges of net investment in
non-integral foreign operations, translation of foreign currency
borrowings and changes in fair value of related cross currency swaps
together designated as hedges of net investment in non-integral foreign
operations. In the Consolidated Accounts, these are considered as
hedges of net investment in non- integral foreign operations and are
recognized directly in shareholder''s fund.
Outlook
According to Nasscom Strategic Review 2014, IT- BPM exports are
estimated to cross USD 86 billion in FY 2014, growing at 13 per cent.
The ability of the industry to suggest solutions that customers need,
in addition to offer what they want has been a crucial factor in the
rise. While US continues to be the largest geographic market for India,
accounting for 62 percent, the highlight for the year was revival in
demand from Europe, which grew at 14 percent in FY 2014. BFSI continues
to be the largest vertical segment accounting 41 per cent of industry
exports; however emerging verticals such as Retail, Healthcare and
Utilities are estimated to grow faster.
IT Services is expected to grow at 14.3 per cent in FY 2014, ER& D
exports are estimated to grow by an estimated 11.1 per cent in FY 2014
driven by domain - specific solutions focusing on convergence
customization, efficiencies and localization.
BPM services growth could be at 11.9 per cent in FY 2014 boosted by
demand from selected customers reverting to Outsourcing Business
Process, especially from the BFSI, Automotive and Retail sectors.
Software Products growth of 9.5 per cent due to increased demand for
vertical- specific and SMAC- based solutions. With the advent of Cloud,
the next big opportunity in India''s 47 million SMBs- who are able to
rapidly bridging the technology adoption gap as they seek to accelerate
growth, and increase competitiveness.
Merger
Pursuant to Sections 391 to 394 of the Companies Act, 1956, and
approval by the Honorable High Court of Karnataka of the Scheme of
Arrangement, Wipro Energy IT Services India Pvt Limited and Wipro
Technology Services Limited, the two subsidiary companies merged with
Wipro Limited and the merger is effective on April 9,2014 with effect
from Appointed date of April 1,2013.
Subsidiary Companies
The Ministry of Corporate Affairs, Government of India, has granted a
general exemption under section 212(8) of the Companies Act, 1956 from
the requirement to attach detailed financial statements of each
subsidiary. In compliance with the exemption granted, we have presented
in pages 180 to 181 summary financial information for each subsidiary.
The detailed financial statements and audit reports of each of the
subsidiaries are available for inspection at the registered office of
the Company during office hours between 11 am to 1 pm and upon written
request from a shareholder, your Company will arrange to send the
financial statements of subsidiary companies to the said shareholder.
Consolidated Results
Our Sales for the current year grew by 17 % to ? 453,457 million and
our Profit for the year was ? 79,471 million, recording an increase of
29% over the previous year.
Dividend
Your Directors recommend a final Dividend of 250% (? 5/- per equity
share of face value ? 21- each) to be appropriated from the profits of
the year 2013-14, subject to the approval of the shareholders at the
ensuing Annual General Meeting. The Dividend will be paid in compliance
with applicable regulations.
During the year 2013-14, unclaimed dividend pertaining to interim
dividend of 2006-07 of ? 63,83,635/- was transferred to the Investor
Education and Protection Fund, as required under the Investor Education
and Protection Fund (Awareness and Protection of Investor) Rules, 2001.
Interim Dividend
Pursuant to the approval of Board of Directors on January 17, 2014,
your Company had distributed an interim dividend of ? 3/- per share, of
face value of X 21- each, to shareholders, who were on the Register of
Members of the Company as at closing hours of January 23, 2014, being
the record date fixed by the Board of Directors for this purpose.
Investments in direct subsidiaries
During the year under review, your Company had invested an aggregate of
USD 114 Mn as equity in its direct subsidiaries. Apart from this, your
Company had funded its subsidiaries, from time totime.as perthefund
requirements,through loans,guarantees and other means.
Research and Development
Requirement under Rule 2 of Companies (Disclosure of particulars in the
report of Board of Directors) Rules, 1988 regardingTechnical Absorption
and Research and Development in Form B is given in Page 43 of the
Annual Report, to the extent applicable.
Corporate Governance & Corporate Social Responsibility
Your Company believes that Corporate Governance is the basis of
stakeholder satisfaction. Your Company''s governance practices are
described separately in Pages 54 to 83 of this annual report. Your
Company has obtained a certification from V. Sreedharan & Associates,
Company Secretaries on compliance with clause 49 of the listing
agreement with Indian Stock Exchanges. This certificate is given in
Page 83.
With a view to strengthen the Corporate Governance framework, the
Ministry of Corporate Affairs, Government of India has incorporated
certain provisions in the Companies Act, 2013. The Ministry of
Corporate Affairs has also issued National Voluntary Guidelines for the
Social, Environmental and Economic Responsibilities of Business 2011
for adoption by companies. The Guidelines broadly outline governance
based on Ethics, Transparency and Accountability, Goods and Services
that contribute to sustainability, promote well being of employees,
respect the interest of disadvantaged, vulnerable and marginalized
groups of stakeholders, promotion of Human Rights, protect and restore
environment, supporting inclusive growth and equitable development and
provide value to our customers.
Corporate Social Responsibility initiatives are provided in the
Business Responsibility Report Pages 84 to 106.
Personnel
The particulars of employees as required by Section 217 (2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employee)
Rules, 1975 as amended is reported in Pages 45 to 50 provided as
annexure''A''to this report.
Wipro Employee Stock Option Plans (WESOP) / Restricted Stock Unit Plans
Summary information on stock options program of the Company is provided
as Annexure B of this report. The information is being provided in
compliance with Clause 12 of the Securities and Exchange Board of India
(Employee Stock Option Scheme) and (Employee Stock Purchase Scheme)
Guidelines, 1999, as amended. No employee was issued Stock Option,
during the year equal to or exceeding 1% of the issued capital of the
Company at the time of grant.
Foreign Exchange Earnings and Outgoings
Duringtheyear.yourCompany has earned Foreign Exchange of ? 344,688
million and the outgoings in Foreign Exchange were ? 147,897 million,
including outgoings on materials imported and dividend.
Conservation of Energy
The Company has taken several steps to conserve energy through
its"Sustainability" initiatives as disclosed separately as part of this
Annual Report. The information on Conservation of Energy as required
under Section 217(1 )(e)ofthe Companies Act, 1956 read with Rule 2 of
the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 on Conservation of Energy is not applicable to
the business segments which we operate. However, as part of Business
Responsibility Report in Pages 84 to 106, we had given details of steps
taken in the area of Energy Conservation and other Sustainability
Intiatives.
Directors: Appointment / Re-appointment
Details regarding Directors proposed to be appointed at the Annual
General Meeting to be held on July 23, 2014, due to changes arising
from the implementation of the Companies Act, 2013 are provided in the
annexure to the Notice convening the Annual General Meeting.
Group
The names of the Promoters and entities comprising "group" (and their
shareholding) as defined under the Competition Act 2002 for the
purposes of Section 3(1)(e)(i) of SEBI (Substantial
Acquisition of Shares and Takeover) Regulations, 1997 include the
following, in addition to other companies that may be forming part of
the "group":
SI. Name of the shareholder No. of
Shares as on
March 31,2014
1 AzimHashamPremji 93,405,100
2 Yasmeen A. Premji 1,062,666
3 Rishad Azim Premji 686,666
4 Tariq Azim Premji 265,000
5 NapeanTrading and Investment 187,666 Company Pvt. Ltd.
6 Vidya Investment and Trading 187,666 Company Pvt. Ltd.
7 Regal Investments and Trading 187,666 Company Pvt. Ltd.
8 Azim Premji Foundation (I) Pvt. Ltd. 10,843,333
9 Mr Azim Hasham Premji Partner 452,906,791
Representing Prazim Traders
10 Mr Azim Hasham Premji Partner 451,619,790
Representing Zash Traders
11 Mr Azim Hasham Premji Partner 370,956,000
Representing Hasham Traders
12 Azim Premji Trust (Held By Trustees of 429,714,120
The Trust)
13 Azim Premji Trustee Company Private NIL
Limited
14 Azim Premji Foundation For NIL
Development
15 Azim Premji Foundation NIL
16 Azim Premji Trust Services Private Nil
Limited
17 Azim Premji Safe Deposit Private Nil
Limited
18 Wipro Enterprises Limited (formerly Nil
known as Azim Premji Custodial
Services Limited)
Total 1,812,022,464
Management''s Discussion and Analysis Report
The Management''s Discussion and Analysis on Company''s
performance-industry trends and other material changes with respect to
the Company and its subsidiaries, whereverapplicable, are presented
from Pages 24 to 40 of this Annual Report.
Re-appointment of Statutory Auditor
The auditors, M/s. BSR & Co LLP (Regd. No. 101248W) Chartered
Accountants, retire at the ensuing Annual General Meeting and have
confirmed their eligibility and willingness to accept office, if
re-appointed.The proposal for their re-appointment is included in the
notice for Annual General Meeting sent herewith.
Cost Audit Report
The Cost Audit report for the year ended March 31,2013 was due on
September 30,2013 and was filed byM/sPSVand Associates, the Cost
Auditor, on September 30,2013.
M/s PSV and Associates has been appointed as Cost Auditor for the
financial year ended March 31, 2014, for the Cost Audit, if applicable
for the year.
Fixed Deposits
Your Company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
Green Initiatives in Corporate Governance
In line with the changes in law permitting companies to send electronic
copies of Annual Report, notices, quarterly results, intimation about
dividend etc., to the e-mail IDs of shareholders, we have arranged to
send the soft copies of these documents to the e-mail IDs of
shareholders available with us or our depositories. In case any of the
shareholder would like to receive physical copies of these documents,
the same shall be forwarded on written request to the Registrars M/s.
Karvy Computer Share Private Limited.
Directors'' Responsibility Statement
On behalf of the Directors, we confirm that as required under Section
217 (2AA) of the Companies Act, 1956.
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company atthe end of the financial yearand of the profits of the
Company for the period;
c) We have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
d) We have prepared the annual accounts on a going concern basis.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions and Central and State Governments for their
consistent supportand encouragementto the Company. I am sure you will
join our Directors in conveying our sincere appreciation to all
employees of the Company and its subsidiaries and Associates for their
hard work and commitment. Their dedication and competence has ensured
that the Company continues to be a significant and leading player in
the IT services industry.
For and on behalf of the Board of Directors
Azim H. Premji
Bangalore, June 25,2014 Chairman
Mar 31, 2013
Dear Shareholders,
The am happy to present the 67th Directors'' Report of your Company
along with the Balance Sheet and Profit and Loss Account for the year
ended March 31, 2013.
Financial Performance
Key aspects of consolidated financial performance for Wipro and its
group companies and standalone financial results for Wipro Limited for
the financial year 2012-13 are tabulated below:
(Rs. in Mns)
Consolidated Standalone
2012-13 2011-12 2012-13 2011-12
Sales and Other Income 388,705 384,563 345,518 329,103
Profit before Tax 78,688 69,814 72,051 59,186
Profit from continuing
operations before tax 78,688 65,855 72,051 56,534
Provision for tax of
continuing operation 16,865 13,036 15,549 11,911
Minority interest (322) (186) - -
Net profit from
continuing operation 61,501 52,575 56,502 44,623
Profit from discontinued
operations before tax - 3,959 - 2,652
Provision for tax of
discontinued operations - 809 - 424
Minority interest and
equity in earnings/
(losses) in affiliates - 320 - -
Net profit from
discontinued operations - 3,470 - 2,228
Net Profit for the year* 61,501 56,045 56,502 46,851
Appropriations
Interim Dividend 4,932 4,917 4,932 4,917
Proposed Dividend on
equity shares 12,315 9,835 12,315 9,835
Corporate tax on
distributed dividend 2,892 2,393 2,892 2,393
Transfer to General Reserve 5,650 4,685 5,650 4,685
Balance Retained in
Statement of Profit and Loss 97,051 65,365 78,371 51,684
* profit for the standalone results is after considering loss of Rs.
1,107 million [2012: Rs. (2,787)] relating to changes in fair value of
forward contracts designated as hedges of net investment in
non-integral foreign operations, translation of foreign currency
borrowings and changes in fair value of related cross currency swaps
together designated as hedges of net investment in non-integral foreign
operations. In the Consolidated Accounts, these are considered as
hedges of net investment in non-integral foreign operations and are
recognized directly in shareholder''s fund.
Note on Demerger: During the financial year 2013, the Company had
initiated and completed the demerger of consumer care and lighting,
infrastructure engineering businesses and other non IT business of the
Company (collectively, the"Diversified Business"). The "Scheme of
Arrangement" ("the Scheme") involved transfer of the Diversified
Business to a "Resulting Company" [Wipro Enterprises Limited (formerly
known as Azim Premji Custodial Services Private Limited)]. The Scheme
became effective on March 31, 2013 with an appointed date of April 01,
2012 with the sanction of the Honorable High Court of Karnataka and
filing of the certified copy of the same with the Registrar of
Companies. Consequent to the demerger of the Diversified Business of
the Company in terms of the Scheme, the financial statements of the
Company for the year ended March 31, 2013, do not include the
operations of the Diversified Business, and are therefore strictly not
comparable with the figures of the previous year ended March 31, 2012.
Please see the financial statements sections for further information.
Pursuant to the Scheme, all shareholders of Wipro received either
securities of the Resulting Company or the equivalent value in
additional shares of Wipro Ltd.
Outlook
According to NASSCOM Strategic Review 2013, Global technology spend is
expected to grow by 6% in 2013. World wide IT Services spending is
expected to grow is expected to grow 4.2% in 2013 and 4.6% in 2014. The
growth is fuelled both by use of IT to reduce cost structure as well as
increased adoption of Cloud, Mobility, Analytics and Social Media.
India continues to be the global sourcing leader. Global sourcing
accounts for only a little over 10 per cent of global technology
spending and this highlights India''s growth potential in the context of
the large and untapped market opportunity.
Subsidiary Companies
The Ministry of Corporate Affairs, Government of India, has granted a
general exemption under Section 212(8) of the Companies Act, 1956 from
the requirement to attach detailed financial statements of each
subsidiary. In compliance with the exemption granted, we have presented
in page 181 to 182 summary financial information for each subsidiary.
The detailed financial statements and audit reports of each of the
subsidiaries are available for inspection at the registered office of
the company during office hours between 11 am to 1 pm and upon written
request from a shareholder, your company will arrange to send the
financial statements of subsidiary companies to the said shareholder.
Consolidated Results - Continuing Business
Our Sales from continuing operation for the current year grew by 17% to
Rs. 388,705 million and our Profit from continuing operation for the
year was Rs. 61,501 million, recording an increase of 17% over the
previous year.
Dividend
Your Directors recommend a final Dividend of 250% (Rs. 5/- per equity
share of Rs. 2/- each) to be appropriated from the profits of the year
2012-13, subject to the approval of the shareholders at the ensuing
Annual General Meeting. The Dividend will be paid in compliance with
applicable regulations.
During the year 2012-13, unclaimed dividend of Rs. 10,01,200/- was
transferred to the Investor Education and Protection Fund, as required
under the Investor Education and Protection Fund (Awareness and
Protection of Investor) Rules, 2001.
Interim Dividend
Pursuant to the approval of Board of Directors on January 18, 2013,
your Company had distributed an interim dividend of Rs. 2/- per share,
of face value of Rs. 2/- each, to shareholders, who were on the
Register of Members of the company as at closing hours of January 25,
2013, being the record date fixed by the Board of Directors for this
purpose.
Acquisitions in IT space
During the year with respect to continuing business, the Company
acquired Promax Applications Group.
Investment in direct subsidiary
During the year under review, your Company had invested an aggregate of
USD 50 Mn as equity in its direct subsidiary i.e. Wipro LLC (formerly
Wipro Inc.) Apart from this, your Company had funded its subsidiaries,
from time to time, as per the fund requirements, through loans,
guarantees and other means.
Research and Development
Requirement under Rule 2 of Companies (Disclosure of particulars in the
report of Board of Directors) Rules, 1988 regarding Technical
Absorption and Research and Development in Form B is given in page 45
and 46 of the Annual Report, to the extent applicable.
Corporate Governance & Corporate Social Responsibility
Your Company believes that Corporate Governance is the basis of
stakeholder satisfaction. Your company''s governance practices are
described separately in page 55 of this annual report. Your Company has
obtained a certification from V. Sreedharan & Associates, Company
Secretaries on compliance with Clause 49 of the Listing Agreement with
Indian Stock Exchanges. This certificate is given in page 84.
With a view to strengthen the Corporate Governance framework, the
Ministry of Corporate Affairs has incorporated certain provisions in
the Companies Bill 2012. The Ministry of Corporate Affairs has also
issued National Voluntary Guidelines for the Social, Environmental and
Economic Responsibilities of Business 2011 for adoption by companies.
The Guidelines broadly outline governance based on Ethics, Transparency
and Accountability, Goods and Services that contribute to
sustainability, promote well -being of employees'', respect the interest
of disadvantaged, vulnerable and marginalized groups of stakeholders,
promotion of Human Rights, protect and restore environment, supporting
inclusive growth and equitable development and provide value to our
customers. On similar lines, Securities and Exchange Board of India
prescribed Business Responsibility Reporting by amending the Listing
Agreement.
Corporate Social Responsibility initiatives are provided in the
Business Responsibility Report Page no 85 to 105 of this report.
Personnel
The particulars of employees as required by Section 217 (2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employee)
Rules, 1975 as amended is reported in Page no 47 to 51 provided as
Annexure ''A'' to this report.
Wipro Employee Stock Option Plans (WESOP) / Restricted Stock Unit Plans
Summary information on stock options program of the Company is provided
as Annexure B of this report. The information is being provided in
compliance with Clause 12 of the Securities and Exchange Board of India
(Employee Stock Option Scheme) and (Employee Stock Purchase Scheme)
Guidelines, 1999, as amended. No employee was issued Stock Option,
during the year equal to or exceeding 1% of the issued capital of the
Company at the time of grant.
Foreign Exchange Earnings and Outgoings
During the year, your Company has earned Foreign Exchange of Rs.
281,025 million and the outgoings in Foreign Exchange were Rs. 120,685
million, including dividend but excluding outgoings on materials
imported.
Conservation of Energy
While the Company has taken several steps to conserve energy through
its "Sustainability" initiatives as disclosed separately as part of
this Annual Report, the information on Conservation of Energy as
required under Section 217(1)(e) of the Companies Act, 1956 read with
Rule 2 Para A of the Companies (Disclosure of Particulars in the Report
of Board of Directors) Rules, 1988 on Conservation of Energy is not
applicable to the business segments which we operate. However, as part
of Business Responsibility Report in pages 85 to 105 we had given
details of steps taken in the area of Energy Conservation and other
Sustainability Initiatives.
Directors:
(A) Re-appointment
Articles of Association of the Company provide that at least two- third
of our Directors shall be subject to retirement by rotation. One third
of these retiring Directors must retire from office at each Annual
General Meeting of the shareholders. A retiring Director is eligible
for re-election. Mr N Vaghul and Dr Ashok S Ganguly, Directors, retire
by rotation and being eligible offer themselves for reappointment at
the ensuing Annual General Meeting. The Board Governance, Nomination
Committee and Compensation Committee/Board have recommended their
re-appointment for consideration of Shareholders'' approval.
(B) Particulars of directors proposed for appointment/ re-appointment
1. Board of Directors vide resolution of April 19, 2013, re- appointed
Mr Suresh C Senapaty as Chief Financial Officer and Executive Director
of the Company from April 18, 2013 to March 31, 2015. This
re-appointment is subject to the approval of shareholders of the
Company at the ensuing Annual General Meeting.
2. Board of Directors vide resolution of June 21, 2013, re- appointed
Mr Azim H Premji, as Chairman and Managing Director of the Company
(designated as "Chairman") for a further period of two years with
effect from July 31, 2013. This re-appointment is subject to the
approval of shareholders of the Company at the ensuing Annual General
Meeting.
3. Mr Vyomesh Joshi was appointed as an Additional Director of the
Company in accordance with Section 260 of the Companies Act, 1956, by
the Board of Directors with effect from October 1, 2012. The Additional
Director would hold office till the date of Annual General Meeting of
the Company scheduled to be held on July 25, 2013. The requisite
notice together with necessary deposit has been received from a member
pursuant to Section 257 of the Companies Act, 1956, proposing the
election of Mr Vyomesh Joshi, as a Director.
Group
The names of the Promoters and entities comprising "group" (and their
shareholding) as defined under Competition Act, 2002 and under SEBI
(Issue of Capital and Disclosure Requirements) Regulations, 2009
include the following:
Sl. Name of the shareholder No. of
No. Shares held
as on March,
31, 2013
1 Azim H Premji 93,405,100
2 Yasmeen A Premji 10,62,666
3 Rishad Azim Premji 6,86,666
4 Tariq Azim Premji 2,65,000
5 Mr. Azim Hasham Premji Partner 370,956,000
Representing Hasham Traders
6 Mr Azim Hasham Premji Partner 480,336,000
Representing Prazim Traders
7 Mr. Azim Hasham Premji Partner 479,049,000
Representing Zash Traders
8 Regal Investments & Trading Company 1,87,666
Private Limited
9 Vidya Investment & Trading Company 1,87,666
Private Limited
10 Napean Trading & Investment Company 1,87,666
Private Limited
11 Azim Premji Foundation (I) Private Limited 10,843,333
12 Azim Premji Trust 4,90,714,120
13 Azim Premji Trustee Company Private NIL
Limited
14 Azim Premji Foundation for Development NIL
15 Azim Premji Foundation NIL
16 Azim Premji Trust Services Private Nil
Limited
17 Azim Premji Safe Deposits Private Nil
Limited
18 Azim Premji Custodial Services Private Nil
Limited
Total 1,927,880,883
Management''s Discussion and Analysis Report
The Management''s Discussion and Analysis on Company''s performance -
industry trends and other material changes with respect to the Company
and its subsidiaries, wherever applicable, are presented from pages 24
to 40 of this Annual Report.
Re-appointment of Statutory Auditor
The auditors, M/s. BSR & Co (Regd. No. 101248W), Chartered Accountants,
retire at the ensuing Annual General Meeting and have confirmed their
eligibility and willingness to accept office, if re-appointed. The
proposal for their re-appointment is included in the notice for Annual
General Meeting sent herewith.
Cost Audit Report
The Cost Audit report for the year ended March 31, 2012 in XBRL
reporting was filed on November 1, 2012, February 14 and 18, 2013 for
various products on which Cost Audit Report is applicable.
Fixed Deposits
Your Company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
Green Initiatives in Corporate Governance
Ministry of Corporate affairs have permitted companies to send
electronic copies of Annual Report, notices, quarterly results,
intimation about dividend etc., to the e-mail IDs of shareholders. We
are accordingly arranging to send the soft copies of these documents to
the e-mail IDs of shareholders available with us or our depositories.
In case any of the shareholder would like to receive physical copies of
these documents, the same shall be forwarded on written request to the
Registrars M/s. Karvy Computer Share Private Limited.
Directors'' Responsibility Statement
On behalf of the Directors, I confirm that as required under Section
217 (2AA) of the Companies Act, 1956.
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the financial year and of the profits of the
Company for the period;
c) We have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
d) We have prepared the annual accounts on a going concern basis.
Compliance with Minimum Public Shareholding requirement
The Company has met with the requirement of having minimum 25% Public
Shareholding as permitted by SEBI and a confirmation to this effect has
been sent to the Stock Exchanges also on June 3, 2013.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions, Reserve Bank of India, Securities and Exchange
Board of India and Central and State Governments for their consistent
support and encouragement to the Company. I am sure you will join our
Directors in conveying our sincere appreciation to all employees of the
Company and its subsidiaries and Associates for their hard work and
commitment. Their dedication and competence has ensured that the
Company continues to be a significant and leading player in the IT
services industry.
For and on behalf of the Board of Directors
Azim H. Premji
Chairman
Bangalore, June 21, 2013
Mar 31, 2012
I am happy to present the 66th Directors' Report of your Company along
with the Balance Sheet and Profit and Loss Account for the year ended
March 31, 2012.
Financial Performance
Key aspects of financial performance for Wipro and its group companies
and standalone / consolidated financial results of Wipro Limited for
the financial year 2011-12 are tabulated below:
(Rs in Mn)
Consolidated Standalone
2011-12 2010-11 2011-12 2010-11
Sales and Other
income 384,563 318,094 329,103 269,812
Profit before Tax 69,813 62,348 59,186 57,055
Provision for Tax 13,845 9,695 12,335 8,618
Minority interest and
equity in earnings/(losses)
in affiliates 77 271 - -
Profit for the year* 56,045 52,924 46,851 48,437
Appropriations
Interim Dividend 4,917 4,908 4,917 4,908
Proposed Dividend
on equity shares 9,835 9,818 9,835 9,818
Corporate tax on distributed
dividend 2,393 2,204 2,393 2,204
Transfer to General
Reserve 4,685 4,844 4,685 4,844
Balance retained in
Profit & Loss account 65,365 31,150 51,684 26,663
*profit for the year in standalone results is after considering loss of
Rs 2,787 million (March 2011: gain of Rs 326 million) relating to changes
in fair value of forward contracts designated as hedges of net
investment in non-integral foreign operations, translation of foreign
currency borrowings and changes in fair value of related cross currency
swaps together designated as hedges of net investment in non-integral
foreign operations. In the consolidated Accounts, these are considered
as hedges of net investment in non-integral foreign operations and are
recognized directly in shareholders' funds. (Refer note 33 on page 141)
Outlook
According to Nasscom Strategic Review 2012, Global technology spend is
expected to grow by 5% in 2012. Worldwide IT Services spending is
expected to grow 4.3% in 2012 and 4.7% in 2013. The growth is fuelled
both by use of IT to reduce cost structures as well as increased
adoption of cloud, mobility, analytics and social media. India accounts
for less than 5% of the global technology spending and this provides a
strong headroom for growth of the IT-BPO sector in India.
Worldwide IT spending is forecast to total $3.7 trillion in 2012, a 2.5
percent increase from 2011, according to the latest outlook by Gartner,
Inc.
Subsidiary Companies
The Ministry of Corporate Affairs, Government of India, has granted a
general exemption under section 212(8) of the Companies Act, 1956 from
the requirement to attach detailed financial statements of each
subsidiary. In compliance with the exemption granted, we have presented
in page 190 to 192 summary financial information for each subsidiary.
The detailed financial statements and audit reports of each of the
subsidiaries are available for inspection at the registered office of
the company during office hours between 11 am to 1 pm and upon written
request from a shareholder, your company will arrange to send the
financial statements of subsidiary companies to the said shareholder.
Consolidated Results
Our Sales for the current year grew by 21% to Rs 384,563 million and our
Profit for the year was Rs 56,045 million, recording an increase of 6%
over the previous year.
Dividend
Your Directors recommend a final Dividend of 200% (Rs 4/- per equity
share of Rs 2/- each) to be appropriated from the profits of the year
2011-12, subject to the approval of the shareholders at the ensuing
Annual General Meeting. The Dividend will be paid in compliance with
applicable regulations.
During the year 2011-12, unclaimed dividend of Rs 5,731,075/- was
transferred to the Investor Education and Protection Fund, as required
under the Investor Education and Protection Fund (Awareness and
Protection of Investor) Rules, 2001.
Interim Dividend
Pursuant to the approval of Board of Directors on January 20, 2012,
your company had distributed an interim dividend of Rs 2/- per share, of
face value of Rs 2/- each, to shareholders, who were on the Register of
Members of the company as at closing hours of January 25, 2012, being
the record date fixed by the Board of Directors for this purpose.
Interim Dividend was paid on February 3, 2012.
Acquisitions in IT Space
During the year, the Company acquired IT Business of SAIC Group and
entered in to a Joint Venture Agreement with Kawasaki and for an
acquisition in Brazil for its Infrastructure Engineering Business.
Investments in direct subsidiaries
During the year under review, your Company had invested an aggregate
amount of USD 101 Mn as equity in its direct subsidiaries i.e. Wipro
Cyprus Private Limited, Wipro Inc, Wipro Holdings Mauritius Limited and
Wipro Infrastructure Engineering Machinery (Changzhou) Co., Ltd. Apart
from this, your Company had funded its subsidiaries, from time to time,
as per the fund requirements, through loans, guarantees and other
means.
Research and Development
Requirement under Rule 2 of Companies (Disclosure of particulars in the
report of Board of Directors) Rules, 1988 regarding Technical
Absorption and Research and Development in Form B is given in page 53
to 54 of the Annual Report, to the extent applicable.
Corporate Governance & Corporate Social Responsibility
Your company believes that Corporate Governance is the basis of
stakeholder satisfaction. Your company's governance practices are
described separately in detail in the section on Corporate Governance
Report (page 64 to 92) of this Annual Report. Your company has
obtained a certificate from V. Sreedharan & Associates, Company
Secretaries on compliance with clause 49 of the listing agreement with
Indian Stock Exchanges. This certificate is given in page 93 of this
Annual Report.
The Ministry of Corporate Affairs had issued National Voluntary
Guidelines on Social, Environmental and Economic Responsibilities of
Business 2011 for adoption by companies. The Guidelines broadly
outline governance based on Ethics, Transparency and Accountability,
Goods and Services that contribute to sustainability, promote well
being of employees, respect the interest of disadvantaged, vulnerable
and marginalised groups of stake holders, promotion of human rights,
protect and restore environment, supporting inclusive growth and
equitable development and provide value to our customers. Corporate
Social Responsibility initiatives are provided in page no. 94 to 116.
Personnel
The particulars of employees as required by Section 217 (2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employee)
Rules, 1975 as amended is reported in page no. 58 to 63 provided as
annexure 'C' to this report.
Wipro Employee Stock Option Plans (WESOP) / Restricted Stock Unit Plans
Summary Information on stock options program of the Company is provided
as Annexure B of this report. The information is being provided in
compliance with Clause 12 of the Securities and Exchange Board of India
(Employee Stock Option Scheme) and (Employee Stock Purchase Scheme)
Guidelines, 1999, as amended. No employee was issued Stock Option,
during the year equal to or exceeding 1% of the issued capital of the
Company at the time of grant.
Foreign Exchange Earnings and Outgoings
During the year, your company has earned foreign exchange of Rs 234,413
million and the outgoings in foreign exchange were Rs 99,782 million,
including outgoings on materials imported and dividend.
Conservation of Energy
The Company has taken several steps to conserve energy through its
"Sustainability" initiatives disclosed separately as part of this
Annual Report. The information on Conservation of Energy as required
under Section 217(1 )(e) of the Companies Act, 1956 read with Rule 2 of
the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 is provided in Annexure A in page 52 of this
Annual Report.
Directors:
(A) Re-appointment
Articles of Association of the Company provide that at least two-third
of our Directors shall be subject to retirement by rotation. One third
of these retiring Directors must retire from office at each Annual
General Meeting of the shareholders. A retiring Director is eligible
for reelection. Dr. Jagdish N Sheth, Mr. Shyam Saran and Dr. Henning
Kagermann, Directors, retire by rotation and, being eligible offer
themselves for reappointment at the ensuing Annual General Meeting. The
Board Governance and Nomination Committee have recommended their re-
appointment for consideration of the Shareholders approval.
Group
The names of the Promoters and entities comprising "group" (and their
shareholding) as defined under the Monopolies and Restrictive Trade
Practices ("MRTP") Act, 1969 for the purposes of Section 3(1)(e)(i) of
SEBI (Substantial Acquisition of Shares and Takeover) Regulations, 1997
include the following:
Sl. Name of the shareholder No. of
No. shares
1. Azim H Premji 93,405,100
2 Yasmeen A Premji 10,62,666
3 Rishad Azim Premji 6,86,666
4 Tariq Azim Premji 2,65,000
5 Mr. Azim Hasham Premji Partner 543,765,000
Representing Hasham Traders
6 Mr Azim Hasham Premji Partner 541,695,000
Representing Prazim Traders
7 Mr. Azim Hasham Premji Partner 540,408,000
Representing Zash Traders
8 Regal Investments & Trading Company 1,87,666
Pvt Ltd
9 Vidya Investment & Trading Company 1,87,666
Pvt Ltd
10 Napean Trading & Investment Company 1,87,666
Pvt Ltd
11 Azim Premji Foundation (I) Pvt. Ltd 10,843,333
12 Azim Premji Trust 1,95,187,120
13 Azim Premji Trustee Company Private NIL
Limited
14 Azim Premji Foundation for NIL
Development
15 Azim Premji Foundation NIL
16 Azim Premji Trust Services Private Limited Nil
17 Azim Premji Safe Deposits Private Limited Nil
18 Azim Premji Custodial Services Private Nil
Limited
Total 1,927,880,883
Management's Discussion and Analysis Report
The Management's Discussion and Analysis on Company's performance -
industry trends and other material changes with respect to the Company
and its subsidiaries, wherever applicable, are presented from page 32
to 48 of this Annual Report.
Re-appointment of Statutory Auditor
The auditors, M/s. BSR & Co (Regt. No. 101248W), Chartered Accountants,
retire at the ensuing Annual General Meeting and have confirmed their
eligibility and willingness to accept office, if re-appointed. The
proposal for their re-appointment is included in the notice for Annual
General Meeting sent herewith.
Cost Audit Report
The Cost Audit report for the year ended March 31, 2011 was due on
September 30, 2011 and was filed on September 24, 2011.
Fixed Deposits
Your company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
Green Initiatives in Corporate Governance
Ministry of Corporate affairs have permitted companies to send
electronic copies of Annual Report, notices, quarterly results
intimation about dividend etc., to the e-mail IDs of shareholders. We
are accordingly arranging to send soft copies of these documents to the
e-mail IDs of shareholders available with us or with our depositories.
In case any of the shareholder would like to receive physical copies of
these documents, the same shall be forwarded on written request to the
Registrars M/s. Karvy Computer Share Private Limited.
Directors' Responsibility Statement
On behalf of the Directors I confirm that as required under Section 217
(2AA) of the Companies Act, 1956.
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the financial year and of the profits of the
Company for the period;
c) We have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
d) We have prepared the annual accounts on a going concern basis.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions and Central and State Governments for their
consistent support and encouragement to the Company. I am sure you will
join our Directors in conveying our sincere appreciation to all
employees of the Company and its Subsidiaries and Associates for their
hard work and commitment. Their dedication and competence has ensured
that the Company continues be a significant and leading player in the
IT services industry.
For and on behalf of the Board of Directors
Azim H. Premji,
Chairman
Bangalore, June 15, 2012
Mar 31, 2011
On behalf of the Board of Directors, I am happy to present the 65th
Directors Report of your Company along with the Balance Sheet and
Profit and Loss Account for the year ended March 31, 2011.
Financial Performance
Key aspects of consolidated fnancial performance for Wipro and its
group companies and standalone fnancial results for Wipro Limited for
the fnancial year 2010-11 are tabulated below:
(Rs. in Mn)
Consolidated Standalone
2010-11 2009-10 2010-11 2009-10
Sales and Other
income 316,938 276,505 269,038 237,887
Profit before Tax 62,348 55,095 57,055 56,888
Provision for Tax 9,695 9,163 8,618 7,908
Minority interest
and equity in
earnings/(losses) in
afliates 271 378 - -
Profit for the year* 52,924 46,310 48,437 48,980
Appropriations
Interim Dividend 4,908 - 4,908 -
Proposed Dividend
on equity shares 9,818 8,809 9,818 8,809
Corporate tax
on distributed
dividend 2,204 1,283 2,204 1,283
Transfer to General
Reserve 4,844 36,218 4,844 38,888
Balance retained
in Profit & Loss
account 31,150 - 26,663 -
* Profit for the year in standalone result is after Rs. 326 million (March
2010: Rs. 4,534 million of gains/(losses) relating to changes in fair
value of forward contracts designated as hedges of net investment in
non-integral foreign operations, translation of foreign currency
borrowings and changes in fair value of related cross currency swaps
together designated as hedges of net investment in non-integral foreign
operations. In the consolidated Accounts, these are considered as
hedges of net investment in non-integral foreign operations and are
recognized directly in shareholders funds. (Refer note 6 on page 112)
Global and Industry outlook
According to NASSCOM Strategic Review 2011, IT spend in 2011 is
expected to grow about 4%. It is expected that in 2011, there will be
increased use of Cloud and Mobile Computing. IT Services is expected to
grow by about 3.5% in 2011 and 4.5% in 2012. Organisations will look
for alternative IT models like Cloud, On-demand Services, SaaS, etc, Ã
in order to reduce hardware infrastructure costs and achieve
scalability on demand.
The Forrester US and Global IT market Outlook Q3, 2010- 11 predicts
that U.S. IT market will grow by 6.6% in 2011. Companies are
increasingly turning to Ofshore Technology Service providers in order
to meet their needs for high quality, cost competitive technology
solutions. As a result, spending in several IT categories is expected
to expand.
Subsidiary Companies
The Ministry of Corporate Afairs, Government of India, has granted a
general exemption under section 212(8) of the Companies Act, 1956 from
the requirement to attach detailed fnancial statements of each
subsidiary. In compliance with the exemption granted, we have presented
in page 163 & 164 summary fnancial information for each subsidiary.
The detailed fnancial statements and audit reports of each of the
subsidiaries are available for inspection at the registered ofce of the
company during ofce hours between 11 am to 1 pm and upon written
request from a shareholder, your company will arrange to send the
fnancial statements of subsidiary companies to the said shareholder.
Consolidated Results
Our Sales for the current year grew by 15% to Rs.. 316,938 million and
our Profit for the year was Rs. 52,924 million, recording an increase of
14% over the previous year. Over the last 10 years, our Sales and Profit
after Tax have grown at a CAGR (compounded annual growth rate) of 26%
and 23% respectively.
Dividend
Your Directors recommend a fnal Dividend of 200% (Rs. 4/- per equity
share of Rs. 2/- each) to be appropriated from the Profits of the year
2010-11, subject to the approval of the shareholders at the ensuing
Annual General Meeting. The Dividend will be paid in compliance with
applicable regulations.
During the year 2010-11, unclaimed dividend of Rs. 1,37,605/- was
transferred to the Investor Education and Protection Fund, as required
under the Investor Education and Protection Fund (Awareness and
Protection of Investor) Rules, 2001.
Interim Dividend
Pursuant to the approval of Board of Directors on January 21, 2011,
your company had distributed an interim dividend of Rs. 2/- per share, of
face value of Rs. 2/- each, to shareholders, who were on the Register of
Members of the company as at closing hours of January 28, 2011, being
the record date fixed by the Board of Directors for this purpose.
Issue of Bonus equity shares/American Depository Shares
In terms of approval of the shareholders of the company through Postal
Ballot pursuant to Section 192 A(2) of the Companies Act, 1956 read
with the companies (Passing of the Resolutions by Postal Ballot) on
June 4, 2010, the Company had allotted Bonus equity shares of Rs. 2/-
each in the ratio of 2:3 (two bonus shares for every three shares held)
to the shareholders of the Company who were on the Register of Members
of the Company as on June 16, 2010, being the Record Date fixed by the
Board of the Directors of the Company for this purpose.
Mergers and Acquisitions
During the year, the Company re-structured a few of its subsidiaries
including overseas subsidiaries through merger/ other legal process.
Wipro Yardley Consumer Care Private Limited, a subsidiary Company got
merged with Wipro Limited w.e.f. April 1, 2010, being the Appointed
Date.
Investments in direct subsidiaries
During the year under review, your Company had invested an aggregate of
USD 34 Mn as equity in its direct subsidiaries i.e. Wipro Cyprus
Private Limited, Wipro Inc, Wipro Holdings Mauritius Limited and Wipro
Infrastructure Engineering Machinery (Changzhou) Co., Ltd. Apart from
this, your Company had funded its subsidiaries, from time to time, as
per the fund requirements, through loans, guarantees and other means.
Corporate Governance & Corporate Social Responsibility
Your company believes that Corporate Governance is the basis of
stakeholder satisfaction. Your companys governance practices are
described separately in page 63 of this annual report. Your company has
obtained a certifcation from V. Sreedharan & Associates, Company
Secretaries on compliance with clause 49 of the listing agreement with
Indian Stock Exchanges. This certifcate is given in page 92.
With a view to strengthen the Corporate Governance framework, the
Ministry of Corporate Afairs has incorporated certain provisions in the
Companies Bill 2009. The Ministry of Corporate Afairs has also issued a
set of Voluntary Guidelines on Corporate Governance and Corporate
Social Responsibility in December 2009 for adoption by companies. The
Guidelines broadly outline conditions for appointment of directors,
guiding principles to remunerate directors, responsibilities of the
Board, Risk Management, rotation of audit partners, audit frms and
conduct of secretarial audit and other Corporate Governance and
Corporate Social Responsibility related disclosures. Your Company has
by and large complied with various requirements and is in the process
of initiating appropriate action for other applicable requirements.
Corporate Governance is also related to Innovation and strategy as the
organizations ideas of Innovation and strategies are driven to enhance
stakeholder satisfaction.
Personnel
The particulars of employees as required by Section 217 (2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employee)
Rules, 1975 as amended have been provided as Annexure C to this
report.
Wipro Employee Stock Option Plans (WESOP) / Restricted Stock Unit Plans
Information relating to stock options program of the Company is
provided as Annexure B of this report. The information is being
provided in compliance with Clause 12 of the Securities and Exchange
Board of India (Employee Stock Option Scheme) and (Employee Stock
Purchase Scheme) Guidelines, 1999, as amended. No employee was issued
Stock Option, during the year equal to or exceeding 1% of the issued
capital of the Company at the time of grant.
Foreign Exchange Earnings and Outgoings
During the year, your company has earned foreign exchange of Rs. 183,771
million and the outgoings in foreign exchange were Rs. 85,642 million,
including outgoings on materials imported and dividend.
Research and Development
Requirement under Rule 2 of Companies (Disclosure of particulars in the
report of Board of Directors) Rules, 1988 regarding Technical
Absorption and Research and Development in Form B is given in Page 54
of the Annual Report, to the extent applicable.
Conservation of Energy
The Company has taken several steps to conserve energy through its ÃEco
Eye and Sustainabilityà initiatives disclosed separately as part of
this Annual Report. The information on Conservation of Energy required
under Section 217(1)(e) of the Companies Act, 1956 read with Rule 2 of
the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988 is provided in Annexure A in page 53 of this
annual report.
Directors:
(A) Appointment
1. Mr. T. K. Kurien was appointed as an Additional Director of the
Company with effect from February 1, 2011 in accordance with Section
260 of the Companies Act, 1956, by the Board of Directors at its
meeting held on January 21, 2011. Mr. T. K. Kurien will hold ofce till
the date of the Annual General Meeting of the Company scheduled to be
held on July 19, 2011. The requisite notices together with necessary
deposits have been received from a member pursuant to Section 257 of
the Companies Act, 1956 proposing the election of Mr. T.K. Kurien as a
Director of the Company. Accordingly, necessary resolution has been
included in the notice for calling Annual General Meeting, for his
appointment as a Director (designated as CEO (IT Business) and
Executive Director).
2. Mr. M.K. Sharma was appointed as an Additional Director of the
Company in accordance with Section 260 of the Companies Act, 1956, by
the Board of Directors with efect from July 1, 2011. The Additional
Director would hold ofce till the date of Annual General Meeting of the
Company scheduled to be held on July 19, 2011. The requisite notices
together with necessary deposits have been received from a member
pursuant to section 257 of the Companies Act, 1956 proposing the
election of Mr. M. K. Sharma, as a Director.
(B) Re-appointment
Articles of Association of the Company provide that at least two- third
of our Directors shall be subject to retirement by rotation. One third
of these retiring Directors must retire from ofce at each Annual
General Meeting of the shareholders. A retiring Director is eligible
for reelection. Mr. Suresh C Senapaty, Mr William Arthur Owens and Mr B
C Prabhakar retire by rotation and being eligible ofer themselves for
reappointment at the ensuing Annual General Meeting. The Board
Governance and Nomination Committee have recommended their
re-appointment for consideration of the Shareholders.
Board of Directors vide circular resolution of June 15, 2011,
re-appointed Mr. Azim H Premji as Chairman and Managing Director of the
Company (designated as ÃChairmanÃ) for a further period of two years
with efect from July 31, 2011. This re-appointment is subject to the
approval of the shareholders of the Company at the ensuing Annual
General Meeting.
(C) Cessation
During the year 2010-11 Mr. Girish S Paranjpe and Mr. Suresh Vaswani
resigned as Board members of the company with efect from closure of
business hours on January 31, 2011.
The Board places on record the valuable contributions of Mr. Girish S
Paranjpe and Mr. Suresh Vaswani during their tenure as Directors of the
Company.
Managements Discussion and Analysis Report
The Managements Discussion and Analysis on Companys performance Ã
industry trends and other material changes with respect to the Company
and its subsidiaries, wherever applicable, are presented on pages 32
through 48 of this annual report.
Re-appointment of Statutory Auditor
The auditors, M/s. BSR & Co., Chartered Accountants, retire at the
ensuing Annual General Meeting and have confrmed their eligibility and
willingness to accept ofce, if re-appointed. The proposal for their
re-appointment is included in the notice for Annual General Meeting
sent herewith.
Re-appointment of Cost Auditor
Pursuant to the direction from the Ministry of Corporate Afairs for
appointment of Cost Auditors, your Board of Directors has re-appointed
M/s. P.D. Dani & Co., Cost Accountants, as the Cost Auditor for the
year ended March 31, 2012.
The Cost Audit report for the year ended March 31, 2010 was due on
September 30, 2010 and was fled by the cost Auditor on August 25, 2010.
Fixed Deposits
Your company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on the Balance Sheet date.
Green Initiatives in Corporate Governance
Ministry of Corporate Afairs has recently permitted companies to send
electronic copies of Annual Report, notices etc., to the e-mail IDs of
shareholders. We have accordingly arranged to send the soft copies of
these documents to the e-mail IDs of shareholders wherever applicable.
In case any of the shareholder would like to receive physical copies of
these documents, the same shall be forwarded on written request to the
Registrars M/s. Karvy Computer Share Private Limited.
Directors Responsibility Statement
On behalf of the Directors I confrm that as required under Section 217
(2AA) of the Companies Act, 1956.
a) In the preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give true and fair view of the state of afairs of the
Company at the end of the fnancial year and of the Profits of the
Company for the period;
c) We have taken proper and sufcient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956 for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
d) We have prepared the annual accounts on a going concern basis.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
fnancial institutions and Central and State Governments for their
consistent support and encouragement to the Company. I am sure you
will join our Directors in conveying our sincere appreciation to all
employees of the Company for their hard work and commitment. Their
dedication and competence has ensured that the Company continues be a
signifcant and leading player in the IT services industry.
For and on behalf of the Board of Directors
Azim H. Premji,
Chairman
Bangalore, June 17, 2011
Mar 31, 2010
I am happy to present on behalf of the Board of Directors, the 64th
Directors Report for the year ended March 31, 2010, along with the
Balance Sheet and Profit and Loss Account for the year.
Financial Performance
Key aspects of your Companys consolidated financial performance for
Wipro and its group companies and standalone financial resultrfor Wipro
Limited for the year 2009-10 are tabulated below: (Rs. in Million)
Consolidated Results Standalone Results
2010 2009 2010 2009
Sales and Other
Income 276,505 259,616 237,973 210,269
Profit before Tax 55,095 45,196 56,888 35,479
Provision for Tax 9,163 6,460 7,908 5,741
Minority interest and
equity in earnings/
(losses) 378 263 - -
in affiliates
Profit for the year 46,310 38,999 48,980 29,738
Appropriations
Proposed Dividend on
equity shares 8,809 5,860 8,809 5,860
Corporate Tax on
distributed dividend 1,283 996 1,283 996
Transfer to
General Reserve 36,218 32,143 38,888 22,882
* Profit for the year in Standalone Result is after Rs 4,534 million
(March 2009: Rs (7,454) million) ofgains/(losses) relating to
translation of foreign currency borrowings and mark to market losses of
related cross currency swaps. In the Consolidated Accounts, these are
considered as hedges of net investment in overseas operations and are
recognized directly in shareholders funds. (Refer note 4 on page 79).
Global and Industry outlook
According to N ASSCOM Strategic Review Report 2010, IDC forecasts a
cumulative annual growth rate (CAGR) of over 4.08% in worldwide IT
services and IT enabled services (IT-ITeS) spending and a CAGR of over
6.18% in offshore IT spending, for the period 2008-13. The combined
market for Indian IT-ITeS in fiscal 2010 was nearly $ 63 billion. Key
factors supporting this projection are the growing impact of technology
led innovation, the increasing demand for global sourcing and gradually
evolving socio-political attitudes.
IDC forecasts worldwide IT services spending of approximately $695
billion by 2013, reflecting a compound annual growth rate, or CAGR, of
3.3%. However, Forrester US and Global IT Market Outlook Q4 2009 ,
predicts that U.S. IT market will grow by 6.6% in 2010 following a drop
of 8.2% in 2009. Companies are increasingly turning to offshore
technology service providers in order to meet their need for high
quality, cost competitive technology solutions. Technology companies
have been outsourcing software research and development and related
support functions to offshore technology service providers to reduce
cycle time for introducing new products and services.
Subsidiary Companies
Wipro is a global corporation having operations in more than 35
countries through 80 subsidiary companies, a few joint ventures and
associate companies. Section 212 of the Companies Act, 1956, requires
that we attach the Directors Report, Balance Sheet and Profit and Loss
Account of our subsidiary companies. We believe that the Consolidated
Financial Statements present a more comprehensive picture rather than
the standalone financial statements of Wipro Limited and each of its
subsidiaries. We, therefore, applied to the Ministry of Corporate
Affairs, Government of India and sought an exemption from the
requirement to present detailed financial statements of each
subsidiary. The Ministry of Corporate Affairs, Government of India, has
granted the exemption. In compliance with the terms of the exemption,
your Company presented in page nos. 151 & 152, summary financial
information for each subsidiary.
The detailed financial statements and audit reports of each of the
subsidiaries are available for inspection at the registered office of
the Company and upon written request from a shareholder, your Company
will arrange to send the financial statements of subsidary companies to
the said shareholder.
Consolidated Results
Our Sales for the current year grew by 7% to Rs. 276,505 million and
our Profit for the year was Rs. 46,310 million, increase of 19% over
the previous year. Over-the last 10 years, our Sales have grown at a
compounded annual growth rate (CAGR) of 28% and Profit after Tax at
31%.
Dividend
Your Board of Directors recommend a final Dividend of 300% (Rs. 6 per
equity share of Rs. 2/- each) to be appropriated from the profits of
the year 2009-10 subject to the approval of the shareholders at the
ensuing Annual General Meeting. The Dividend will be paid in compliance
with applicable regulations.
During the year 2009-10, unclaimed dividend of Rs. 1,995,655
transferred to the Investor Education and Protection Fund, as required
by the Investor Education and Protection Fund (Awareness and Protection
of Investor) Rules, 2001.
Issue of Bonus equity shares/American Depository Shares
Your Board of Directors has approved issue of Bonus Shares in the ratio
of two equity shares for every three existing equity shares outstanding
as on the record date and two American Depositary Shares for every
three existing American Depository Shares outstanding as on the record
date. Issue of Bonus Shares has also been approved by the shareholders
of the Company through Postal Ballot on June 4, 2010. Subsequent to
this approval, the record date to determine the eligible shareholders
who are entitled to receive the Bonus Shares fixed as June 16, 2010.
Acquisitions and Joint Ventures
Your Company has continued to pursue the strategy of "string of pearls
acquisitions" by acquiring businesses which complement our service
offerings, provide access to niche skill sets and expand our presence
in select geographies. Your Company has a dedicated team of
professionals who identify businesses which meet our strategic
requirements and are cultural fit to Wipro.
In August 2009, your Company had entered into partnership with Lavasa
Corporation Limited for planning, implementing and managing Information
and Communication Technology services across Lavasa City. Wipro will
support Lavasa City in the areas of City Management system and
services, E Governance, Information and Communication Technology
services and other value added services.
In October 2009, your Company signed an agreement to form a joint
venture with Delhi International Aiport
Private Limited. This Joint Venture Company is named as Wipro Airport
IT Services Limited. Wipro holds 74% in the Joint Venture and Delhi
International Airport Private Limited holds 26% stake. This partnership
assumes significance as IGI airports new integrated terminal (T3) will
be the gateway for the Commonwealth Games scheduled to be held in New
Delhi.
In October 2009, Wipro GE Healthcare Private Limited, the Joint Venture
between Wipro Limited and GE Healthcare, transformed its business by
integrating several existing stand-alone business units and
manufacturing plants of GE Healthcare in India under Wipro GE
Healthcare Entity. This strategic move will lead to more effective
management and resources utilization and help accelerate growth,
through Wipro GE Healthcares large distribution network. This move
will define the next stage of market leadership for Wipro GE
Healthcare.
In November 2009, your Company had signed an agreement to acquire the
"Yardley" Brand business in Asia, Middle East, Australia and certain
African markets from UK based Lornamead Group. This transaction adds
another jewel to Wipro Consumer Care and Lighting (FMCG arm of Wipro
Limited).
All the subsidiaries of the Company are unlisted and none of them are
material unlisted subsidiaries as per Clause 49 of the Listing
Agreement.
Investments in direct subsidiaries
During the year under review, your Company has made acquisitions and
investments of an aggregate of US$ 171 Million as equity in its direct
subsidiaries Wipro Cyprus Private Limited, Wipro Inc and Wipro Yardley
Consumer Care Private Limited.
Your Company has also invested Rs. 37 Million as equity in Wipro
Airport IT Services Limited, a newly formed joint venture company with
Delhi International Airport (P) Limited. Apart from this, the Company
has funded its subsidiaries, from time to time, as per the funding
requirements, through loans, guarantees and other means.
Corporate Governance & Corporate Social Responsibility
Your Company believes Corporate Governance is at the core of
stakeholder satisfaction. Your Companys governance practices are
described separately in page 57 of this Annual Report. Your Company has
obtained a certification from Sreedharan & Associates, Company
Secretaries on our compliance with Clause 49 of the Listing Agreement
with Indian Stock Exchanges. This certificate is given in page 84.
With a view to strengthening the Corporate Governance framework, the
Ministry of Corporate Affairs has incorporated certain provisions in
the Companies Bill, 2009. The Ministty of Corporate Affairs has also
issued a set of Voluntary Guidelines on Corporate Governance and
Corporate Social Responsibility in December 2009 for adoption by the
companies. The Guidelines broadly outline conditions for appointment of
directors, guiding principles to remunerate directors, responsibilities
of the Boatd, Risk Management, rotation of audit partners, audit firms,
conduct of secretarial audit and other Corporate Governance and
Corporate Social Responsibility related disclosures. Your Company has
by and large complied with various requirements and is in the process
of initiating appropriate action, for the other applicable
requirements.
Corporate Governance is also related to Innovation and Strategy as the
organisations ideas of Innovation and strategies are driven to enhance
stakeholder satisfaction for all stakeholders.
Personnel
The particulars of employees as required by Section 217 (2A) of the
Companies Act, 1956, read with the Companies (Particulars of Employee)
Rules, 1975, have been provided as an additional.booklet.
Wipro Employee Stock Option Plans/Restricted Stock Unit Plans
Information relating to stock options program of the Company is
provided in page 7 of this report. The information is being provided in
compliance with Clause 12 of the Securities and Exchange Board of India
(Employee Stock Option Scheme) and (Employee Stock Purchase Scheme)
Guidelines, 1999, as amended. No employee was issued Stock Option,
during the year equal to or exceeding 1 % of the issued capital of the
Company at the time of grant.
Foreign Exchange Earnings and Outgoings
During the year, your Company has earned foreign exchange of Rs.
168,469 million and the outgoings inforeignexchange were Rs. 71,739
million, including outgoings on materials imported and dividend.
Research and Development
Requirement under Rule 2 of Companies (Disclosure of Particulars in the
Report of Board of Directors) Rules, 1988, regarding Technical
Absorption and Research and Development in Form B is given in Page 47
of the Annual Report, to the extent applicable.
Conservation of Energy
The Company has taken several steps to conserve energy through its "Eco
Eye and Sustainability" initiatives disclosed separately as part of
this Annual Report. The information on Conservation of Energy required
under Section 217(1 )(e) of the Companies Act, 1956, read with Rule 2
of the Companies (Disclosure of Particulars in the Report of Board of
Directors) Rules, 1988, is provided in Annexure A in page 44 of this
Annual Report.
Directors Re-appointment
Articles of Association of the Company provide that at least two-thirds
of our Directors shall be subject to retirement by rotation. One third
of these retiring Directors must retire from office at each Annual
General Meeting of the shareholders. A retiring Director is eligible
for re-election. Mr N Vaghul, Dr Ashok Ganguly and Mr P M Sinha,
retire by rotation and being eligible offer themselves for
re-appointmeht at this Annual General Meeting. Since the Board
Governance and Nomination Committee members were interested in the
resolution of re-appointment, Board of Directors have recommended their
re-appointment for consideration of the Shareholders.
Directors Appointment
Dr Henning Kagermann was appointed as an Additional Director of the
Company with effect from October 27, 2009 in accordance with Section
260 of the Companies Act, 1956. Dr Henning Kagermann would hold office
till the conclusion of the Annual General Meeting of the Company
scheduled to be held on July 22, 2010. The requisite notices together
with necessaty deposits have been received from a member pursuant to
Section 257 of the Companies Act, 1956, proposing the election of Dr
Henning Kagermann as a Director of the Company.
Mr. Shyam Saran, Former Foreign Secretary, Government of India was
appointed as an Additional Director of the Company in accordance with
Section 260 of the Companies Act, 1956 by the Board of Directors with
effect from July 1, 2010. The Additional Director would hold office
till the date of the Annual General Meeting of the Company scheduled to
be held on July 22, 2010. The requisite notices together with
necessary deposit have been received from a member pursuant to Section
257 of the Companies Act, 1956 proposing the election of Mr. Shyam
Saran.
Group
The names of the Promoters and entities comprising "group" as defined
under the Monopolies and Restrictive Trade Practices ("MRTP") Act,
1969, for the purposes of
Section 3( 1 )(e)(i) of the SEBI (Substantial Acquisition of Shares and
Takeover) Regulations, 1997, include:
Sl. Name of the shareholder No. of shares
No.
1 Azim H Premji 56,043,060
2 Yasmeen A Premji 637,600
3 Rishad Azim Premji 568,000
4 Tariq Azim Premji 159,000
5 Mr Azim Hasham Premji Partner 326,259,000
Representing Hasham Traders
6 Mr Azim Hasham Premji Partner 325,017,000
Representing Prazim Traders
7 Mr Azim Hasham Premji Partner 324,244,800
Representing Zash Traders
8 Regal Investments & Trading Company 51,014,200
Pvt. Ltd.
9 Vidya Investment & Trading Company 38,860,600
Pvt. Ltd.
10 Napean Trading & Investment 38,263,000
Company Pvt. Ltd.
11 Azim Premji Foundation (I) Pvt. Ltd. 6,506,000
12 Azim Premji Trust Nil
13 Azim Premji Trustee Company Private Nil
Limited;
14 Azim Premji Foundation for Nil
Development
15 Azim Premji Foundation Nil
Managements Discussion and Analysis Report
The Managements Discussion and Analysis on Companys performance -
industry trends and other material changes with respect to the Company
and its subsidiaries, wherever applicable are presented on pages 26
through 33 of this Annual Report.
Re-appointment of Statutory Auditor
The auditors, M/s. BSR & Co., Chartered Accountants, retire at the
ensuing Annual General Meeting and have, confirmed their eligibility
and willingness to accept office, if re-appointed. The proposal for
their re-appointment is included in the notice for Annual General
Meeting sent herewith.
Re-appointment of Cost Auditor
Pursuant to the direction from the Ministry of Corporate Affairs for
appointment of Cost Auditors, your Board of Directors has re-appointed
P.D. Dani & Co., as the Cost Auditor for the year ended March 31, 2011.
Fixed Deposits
Your Company has not accepted any fixed deposits. Hence, there is no
outstanding amount as on die Balance Sheet date.
Directors Responsibility Statement
On behalf of the Directors I confirm that as required under Section 217
(2AA) of the Companies Act, 1956.
a) In die preparation of the annual accounts, the applicable accounting
standards have been followed and that no material departures are made
from the same;
b) We have selected such accounting policies and applied them
consistently and made judgements and estimates that are reasonable and
prudent so as to give true and fair view of the state of affairs of the
Company at the end of the financial year and of the profits of the
Company for the period;
c) We have taken proper and sufficient care for the maintenance of
adequate accounting records in accordance with the provisions of the
Companies Act, 1956, for safeguarding the assets of the Company and for
preventing and detecting fraud and other irregularities; and
d) We have prepared the annual accounts on a going concern basis.
Acknowledgements and Appreciation
Your Directors take this opportunity to thank the customers,
shareholders, suppliers, bankers, business partners/associates,
financial institutions and Central and State Governments for their
consistent support and encouragement to the Company. I am sure you will
join our Directors in conveying our sincere appreciation to all
employees of the Company for their hard work and commitment. Their
dedication and competence has ensured that the Company continues to be
a significant and leading player in the IT Services industry.
For and on behalf of the Board of Directors
Azim H. Premji
Chairman
Bangalore, June 21, 2010