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Wipro shares fell as much as 2.5 per cent as the company had on Monday said that one of its telecom clients in India has filed for bankruptcy and it would impact its profit for the March quarter and year ended March 31, 2018.
"On February 28, 2018, the client filed a petition to initiate its Corporate Insolvency Resolution Process (CIRP) with the National Company Law Tribunal (NCLT)," Wipro said in a BSE filing. However, it did not name the client.
On February 28, Aircel had filed for bankruptcy. Wipro said it has subsequently submitted its claim on March 28, 2018 and since then has been engaged with the Insolvency Resolution Professional to discuss the potential outcome of the process.
Wipro said it is likely to see an impact on profitability at the net income level in the range of 65-75 basis points of the consolidated revenues for the quarter ended March 31, 2018. The impact of this client insolvency petition will reflect in the financial results of the company for the quarter and year ended March 31, 2018, it added.
In the year 2008, Wipro had signed a multi-year outsourcing services agreement with the telecom client, which was subsequently renewed in 2013.
The IT services provider's stock posted biggest intraday percentage drop since March 26. Up to Monday's close, stock had declined 9 per cent this year after gaining 32.5 per cent last year.
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