Annual Report - Wipro - 2009-2010

WIPRO LIMITED

ANNUAL REPORT 2009-2010

DIRECTOR'S REPORT

To
The Members

Dear Shareholders,

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 Company's consolidated financial performance for Wipro
and its group companies and standalone financial results for Wipro Limited
for the year 2009-10 are tabulated below:

(Rs. in Million)

Consolidated Standalone
Results 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) in affiliates 378 263 - -

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) of gains/(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 NASSCOM 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 subsidiary 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 airport's 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 Healthcare's 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 Company's governance practices are described separately
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 this Annual Report.

With a view to strengthening the Corporate Governance framework, the
Ministry of Corporate Affairs has incorporated certain provisions in the
Companies Bill, 2009. The Ministry 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 Board, 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
organisation's 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 in foreign exchange 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 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 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-appointment 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 necessary
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 been provided as an additional booklet.

Section 3(1)(e)(i) of the SEBI (Substantial Acquisition of Shares and
Takeover) Regulations, 1997, include:

Name of the shareholder No. of shares

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
Representing Hasham Traders 326,259,000

6. Mr Azim Hasham Premji Partner
Representing Prazim Traders 325,017,000

7. Mr Azim Hasham Premji Partner
Representing Zash Traders 324,244,800

8. Regal Investments & Trading Company
Pvt. Ltd. 51,014,200

9. Vidya Investment & Trading Company
Pvt. Ltd. 38,860,600

10. Napean Trading & Investment
Company Pvt. Ltd. 38,263,000

11. Azim Premji Foundation (I) Pvt. Ltd. 6,506,000

12. Azim Premji Trust Nil

13. Azim Premji Trustee Company Private Limited Nil

14. Azim Premji Foundation for Development Nil

15. Azim Premji Foundation Nil

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 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 the 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 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 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
Place : Bangalore,
Date : June 21, 2010

ANNEXURE 'A' FORMING PART OF THE DIRECTORS' REPORT:

A. DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY:
(Wipro Infrastructure Engineering Division):

Electricity 2009-2010 2008-2009

a. Purchased:

Unit KWH 5,683,709 4,872,613

Total Amount Rs. 30,024,982 23,746,108

Rate/unit Rs. 5.28 4.87

b. Own generation:

Through Diesel Generator:

Unit KWH 824,978 398,638

Unit/litre of diesel Units 2.53 2.17

Cost per unit Rs. 13.87 16.68

B. CONSUMPTION PER UNIT PRODUCTION:
(Wipro Infrastructure Engineering Division):

Electricity Diesel
(kwh/cyl.) (Lts/Cyl.)

2009-10 20.61 1.03
2008-09 19.05 0.66

C. DISCLOSURE OF PARTICULARS WITH RESPECT TO CONSERVATION OF ENERGY:
(Wipro Consumer Care and Lighting Division)

Electricity 2009-2010 2008-2009

a. Purchased:

Unit KWH 18,104,719 14,848,463

Total Amount Rs. 81,983,935 65,068,207

Rate/unit Rs. 4.53 4.38

b. Own generation:

Through Diesel Generator:

Unit KWH 1,047,006 859,456

Unit/litre of diesel Units 3.15 3.04

Cost per unit Rs. 10.90 11.27

Coal:

Quantity Tones 2,594 3,187

Total Cost Rs. 12,115,327 15,909,865

Av. Rate Rs. 4,671 4,992

Furnace Oil:

Quantity FO Ltrs. 4,546,900 3,903,204

Total Cost Rs. 120,679,932 113,006,503

Av. Rate Rs. 26.54 28.95

Quantity Kgs. 697,410 594,221

Total Cost Rs. 24,944,813 24,718,033

Av. Rate Rs. 35.77 41.60

H2 Gas:

Quantity CMT 107,623 109,981

Total Cost Rs. 3,670,983 3,672,356

Av. Rate Rs. 34.11 33.39

D. CONSUMPTION PER UNIT PRODUCTION:

(Wipro Consumer Care and Lighting Division):

Vanaspati Electricity Liquid Diesel Oil
(KWH/Tonne) (Litres/Tonne)

ACT STD ACT STD

2009-10 130.53 109 NA -
2008-09 138.42 109 NA -

FORM B:

Wipro's Research and Development Activities: 2009-10:

Wipro's Research & Development focus is to strengthen the portfolio of
Applied Research, Centers of Excellence (CoE), Solution Accelerators and
Software Engineering Tools & Methodologies.

Applied Research:

Our current area of activities in Applied Research is around Content
Analytics, Enterprise Blog characterization and Enterprise system
performance in Cloud. Investments in Applied Research has helped in
collaboration with academic institutes like Georgia Tech, IIIT-B and
enabled publication and participation in research conferences such as COMAD
2009, ACM India and Compute 2010.

Centers of Excellence (CoE):

The goal of a CoE is to create competencies in emerging areas of
technologies & industry domain and incubate new practices for business
growth. In order to enhance focus, few technologies are driven centrally as
Theme initiatives. For Financial Year 2009-10, the Technology themes
identified were Cloud Computing, Green IT, Social Computing, Information
Management, Mobility, Collaboration and Open Source. Investments in Cloud
and Green IT CoE have enabled deployment of private cloud infrastructure as
well as energy & carbon management solution within Wipro.

Solution Accelerators:

Your Company continued to invest in reusable IP's/solution accelerators
(components, tools, frameworks) which help in accelerating the
implementation of solutions in customer engagements. Industry solution
accelerators are specific to a particular industry segment whereas
Functional and Technology solution accelerators can be used across industry
segments.

Sample examples of technology solution accelerator include SaaS enabler,
Social Media platform, Open Source UC and Mobility framework. One solution
accelerator in enterprise security space - IDAM in a Rack - won Info
Security Global Product Excellence Award 2010.

Software Engineering Tools & Methodologies:

Your Company continued to invest in in-house development of software
engineering tools to improve productivity and Quality; Examples include
Wipro style, Wipro Accelerator, Wipro Unit Test and Wipro code checker.
These tools have been widely deployed across projects with Wipro.

Your Company developed an unique approach to speed up knowledge transition
in customer projects by using reverse engineering capability to view the
architecture of application as well as collaboration and recording tools
for speedy and effective communication. Your Company has developed an
approach for Flex shared delivery with innovative solution for effective
queue and capacity management for reduced cost.

Delivery Model Innovation:

Your Company continued to invest in Innovative delivery models targeted
towards outcome based as against head count based Service Delivery &
Pricing. One such initiative - CIGMA - won NASSCOM Innovation Award 2009 in
Process category.

Patents:

In Financial Year 2009-10, we have filed for 7 patents and 6 patents have
been granted.

Expenditure on R&D:

During the year under review, your Company incurred an expenditure of Rs.
993 million including capital expenditure in continued development of R&D
activities.

ANNEXURE B FORMING PART OF THE CORPORATE GOVERNANCE REPORT:

Disclosure in compliance with Clause 12 of the SEBI (Employee Stock Option
Scheme) and (Employee Stock Purchase Scheme) Guidelines, 1999 as amended:

I. Description : WESOP 1999

1. Total Number of options : 30,000,000 (Adjusted under the Plan
for the issue of bonus shares in the
years 2004 and 2005)

2. Options/RSUs grants approved : -
during the year

3. Pricing formula : Fair market vale i.e. the market
price as defined by the Securities and
Exchange Board of India

4. Options Vested during the year : -

5. Options exercised during the : -
year

6. Total number of shares arising : -
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : -
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : -
options during the year (Rs.)

10. Total number of options in : -
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Not Applicable as there were no grants
calculated the employees during the year under this Plan
compensation cost using
the instrinsic value of the
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Not Applicable as there were no grants
prices and weighted average during the year under this Plan
fair values of options
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Not Applicable as there were no grants
during the year under this Plan
(b) expected life

(c) expected volatility

(d) expected dividends and

(e) the price for the underlying
share in market at the time
of option grant

II. Description : WESOP 2000

1. Total Number of options : 150,000,000 (Adjusted for the issue of
bonus shares in the years 2004 and
2005)

2. Options/RSUs grants approved : -
during the year

3. Pricing formula : Fair market vale i.e. the market price
as defined by the Securities and
Exchange Board of India

4. Options Vested during the year : -

5. Options exercised during the : -
year

6. Total number of shares arising : -
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : 1,140
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : -
options during the year (Rs.)

10. Total number of options in : -
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Not Applicable as there were no grants
calculated the employees during the year under this Plan
compensation cost using
the instrinsic value of the
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Not Applicable as there were no grants
prices and weighted average during the year under this Plan
fair values of options
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Not Applicable as there were no grants
during the year under this Plan
(b) expected life

(c) expected volatility

(d) expected dividends and

(e) the price for the underlying
share in market at the time
of option grant

III. Description : ADS 2000 Stock Option Plan

1. Total Number of options : 9,000,000 ADS representing 9,000,000
underlying equity shares (Adjusted for
the issue of bonus shares of the years
2004 and 2005)

2. Options/RSUs grants approved : -
during the year

3. Pricing formula : Exercise price being not less than 90%
of the market price on the date of
grant

4. Options Vested during the year : -

5. Options exercised during the :
year

6. Total number of shares arising : -
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : -
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : -
options during the year (Rs.)

10. Total number of options in : 1,606
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Not Applicable as there were no grants
calculated the employees during the year under this Plan
compensation cost using
the instrinsic value of the
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Not Applicable as there were no grants
prices and weighted average during the year under this Plan
fair values of options
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Not Applicable as there were no grants
during the year under this Plan
(b) expected life

(c) expected volatility

(d) expected dividends and

(e) the price of the underlying
share in market at the time
of option grant

IV. Description : Wipro Restricted Stock Unit Plan 2004

1. Total Number of options : 12,000,000 (Adjusted for the issue of
bonus shares of the years 2004 and
2005)

2. Options/RSUs grants approved : -
during the year

3. Pricing formula : Face value of the share

4. Options Vested during the year : 2,072,152

5. Options exercised during the : 2,076,121
year

6. Total number of shares arising : 2,076,121
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : 235,901
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : 4,152,242
options during the year (Rs.)

10. Total number of options in : 3,353,226
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Since these options were granted at a
calculated the employees nominal exercise price, intrinsic
compensation cost using value on the date of grant
the instrinsic value of the approximates the fair value of options
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Exercise price Rs. 2/- per option.
prices and weighted average Fair value Rs. 706.95/- as on March
fair values of options 31, 2010
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Since these options were granted at a
nominal exercise price, intrinsic
(b) expected life value on the date of grant
approximates the fair value of options
(c) expected volatility

(d) expected dividends and

(e) the price of the underlying
share in market at the time
of option grant

V. Description : Wipro Restricted Stock Unit Plan 2005

1. Total Number of options : 12,000,000 (Adjusted for the issue of
bonus shares of the year 2005)

2. Options/RSUs grants approved : 5,000
during the year

3. Pricing formula : Face value of the share

4. Options Vested during the year : 2,408,524

5. Options exercised during the : 662,303
year

6. Total number of shares arising : 662,303
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : 569,821
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : 1,324,606
options during the year (Rs.)

10. Total number of options in : 7,001,124
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Since these options were granted at a
calculated the employees nominal exercise price, intrinsic
compensation cost using value on the date of grant
the instrinsic value of the approximates the fair value of options
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Exercise price Rs. 2/- per option.
prices and weighted average Fair value Rs. 706.95/- as on March
fair values of options 31, 2010
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Since these options were granted at a
nominal exercise price, intrinsic
(b) expected life value on the date of grant
approximates the fair value of options
(c) expected volatility

(d) expected dividends and

(e) the price of the underlying
share in market at the time
of option grant

VI. Description : ADS Restricted Stock Unit Plan 2004

1. Total Number of options : 12,000,000 ADS representing 12,000,000
underlying equity shares (Adjusted for
the issue of bonus shares of the years
2004 and 2005)

2. Options/RSUs grants approved : 137,100
during the year

3. Pricing formula : Face value of the share

4. Options Vested during the year : 930,448

5. Options exercised during the : 492,019
year

6. Total number of shares arising : 492,019
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : 348,401
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : 984,038
options during the year (Rs.)

10. Total number of options in : 1,832,170
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : 50,000

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar : 50,000

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Since these options were granted at a
calculated the employees nominal exercise price, intrinsic
compensation cost using value on the date of grant
the instrinsic value of the approximates the fair value of options
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Exercise price Rs. 2/- per option.
prices and weighted average Fair value $ 23.31/- as on March
fair values of options 31, 2010
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Since these options were granted at a
nominal exercise price, intrinsic
(b) expected life value on the date of grant
approximates the fair value of options
(c) expected volatility

(d) expected dividends and

(e) the price of the underlying
share in market at the time
of option grant

VII. Description : Wipro Restricted Stock Unit Plan 2007

1. Total Number of options : 10,000,000

2. Options/RSUs grants approved : -
during the year

3. Pricing formula : Face value of the share

4. Options Vested during the year : -

5. Options exercised during the : -
year

6. Total number of shares arising : -
as a result of exercise of
option (as of March 31, 2010)

7. Options lapsed/forfeited : -
during the year *

8. Variation of terms of options : -
upto March 31, 2010

9. Money realised by exercise of : -
options during the year (Rs.)

10. Total number of options in : -
options in force at the end of
the year (granted, vested and
unexercised/unvested and
unexercised

11. Employee wise details of : -
options granted to

i. Senior Management during
the year:

a. Martha Bejar : -

ii. Employees holding 5% or
more of the total number of
options granted during the
year:

a. Martha Bejar :

iii. Identified employees who : -
were granted option,
during any one year, equal
to or exceeding 1% of the
issued capital (excluding
outstanding warrants and
conversions) of the Company
at the time of grant

12. Diluted Earning per Share : 33.38
pursuant ot issue of shares on
exercise of option calculated in
accordance with Accounting
Standard (AS ) 20

13. Where the Company has : Not applicable as no options are
calculated the employees granted under this Plan
compensation cost using
the instrinsic value of the
stock options, the difference
between the employee
compensation cost so
computed and the employee
compensation cost that shall
have been recognised if it
had used the fair value of the
options. The impact of this
difference on profits and on
EPS of the Company

14. Weighted average exercise : Not applicable as no options are
prices and weighted average granted under this Plan
fair values of options
separately for options whose
exercise price either equals
or exceeds or is less than the
market prices of the stock

15. A description of method
and significant assumptions
used during the year to
estimate the fair values
of options, including the
following weighted average
information:

(a) risk free interest rate : Not applicable as no options are
granted under this Plan
(b) expected life

(c) expected volatility

(d) expected dividends and

(e) the price of the underlying
share in market at the time
of option grant

* As per the Plan, Options/RSUs lapse only on termination of the Plan. If
an Option/RSU expires or becomes unexercisable without having been
exercised in full, such options shall become available for future grant
under the Plan.

MANAGEMENT'S DISCUSSION AND ANALYSIS:

I. Segment-wise performance:

Segment-wise contributions in 2009-10:

Segment-wise contribution to Revenue:

IT Services 75%
IT Products 14%
Consumer Care and Lighting & Others 11%

Segment-wise contribution to EBIT:

IT Services 92%
IT Products 3%
Consumer Care and Lighting & Others 5%

We are a leading global information technology, or IT, services company,
headquartered in Bangalore, India. We provide a comprehensive range of IT
services, consulting, systems integration, BPO, software solutions and
research and development services in the areas of hardware and software
design to leading companies worldwide. We use our development centers
located around the world, quality processes and global resource pool to
provide cost effective IT solutions and deliver time-to-market and time-to-
development advantages to our clients.

Our IT Products segment is a leader in the Indian IT market and focuses
primarily on meeting requirements for IT products of companies in India and
the Middle East region.

We also have a notable presence in the markets for consumer products and
lighting and infrastructure engineering.

In the subsequent section of this report, we will report for each of our
business segment separately, the industry structure and developments,
opportunities and threats, and risk and concerns.

II. Industry Overview:

IT Services:

The shift in the role of Information and Technology (IT) from merely
supporting business to transforming business, is driving productivity gains
and helping create new business models. This has led to an increase in the
importance of IT. The increasing acceptance of outsourcing and off-shoring
of activities as an economic necessity has contributed to the continued
growth in our revenue. As corporate and businesses adjust to 'new normal'
post the recent global recession, they will need to transform their
business models to the changed economic and business environment.
Consequently, they will have to make significant investments in IT. This
opens up opportunities for us to offer our consulting, Systems Integration
services and leverage our Global Delivery footprint and thus help our
customers in their transformation journey.

These opportunities are also reflected in the forecasts of market growth.
IDC forecasts worldwide IT services spending of approximately $695 billion
by 2013, reflecting a compounded 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.
Similarly, according to NASSCOM Strategic Review Report 2010, the worldwide
BPO market is expected to touch $ 148 billion by 2013, representing a CAGR,
of 6.11%. 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. Global Delivery led
organizations are expected to get an increased share of the IT services
spends due to the powerful combination of scale, quality and cost embedded
in their business model. In India, the IT services market is estimated to
account for 39% of the domestic IT industry. The key verticals driving the
growth of the IT services market are Retail, Government, Healthcare,
Telecom and Manufacturing. However, according to IDC's report - India
domestic IT/ITeS market top 10 predictions for 2010, the India domestic
IT/ITeS market growth rate will come down from an average of 24% recorded
during 2003-08 to 14.6% over the next five years to 2013.

IT Products:

According to NASSCOM Strategic Review Report 2010, IDC forecasts that
worldwide hardware spending will increase from $600 billion in 2008 to $680
billion in 2013, representing a CAGR of 2.53%.

According to NASSCOM Strategic Review Report 2010, the hardware market in
India is estimated to account for 39% of the domestic IT industry, growing
at about 3% in 2010. Personal computers (including desktops and notebooks)
continue to be purchased at higher rates than other products in the
hardware market. As prices come down, notebooks are increasingly being
adopted as the computing device of choice. For the desktop segment,
consumers are showing an increasing trend of moving away from locally
assembled items towards branded products with relatively higher end
configurations.

Consumer Care and Lighting:

The consumer care market includes personal care products, soaps,
toiletries, infant care products, modular switch lights and modular office
furniture. We have a strong brand presence in a niche segment and have
significant market share in select regions in India. In addition, we have a
strong presence in the market for personal care products in south-east Asia
and Middle-East Asia.

AC Nielsen estimates that India is amongst the fastest growing geographies
for FMCG, with a 2009 growth rate of 14.0% for the non-food segment,
largely led by price increases. This market is estimated to grow at a CAGR
of 8% - 10% for the period 2010-2013. The household and personal care FMCG
market in the other Asian countries in which we operate including Malaysia,
Vietnam and Indonesia, are expected to grow at a CAGR of 8% for the period
2010-2013.

The Indian domestic market for institutional lighting and office modular
furniture is estimated at U.S. $ 600 million and is expected to grow at the
rate of 10% to 15% for the period 2010-2011. Key sectors contributing to
the growth are expected to be modern work spaces, IT-ITeS, Retail,
Healthcare and Government Infrastructure spending.

We expect to increase our market share organically in our identified
geographies. In addition we continue to look at acquiring established
brands which complement our brand presence and distribution strengths.

Others:

In the other segment, Wipro Infrastructure Engineering (WIN) is the key
business segment. We sell hydraulic cylinders and truck tipping systems
that are used in variety of earth moving, material handling, mining and
construction equipments.

III. Opportunity and Threats:

IT Services:

Global 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.

According to NASSCOM Strategic Review Report 2009, IDC forecasts a CAGR of
over 6.18% in offshore IT spending, for the period 2008-13.

As a de-risking strategy, companies have moved from giving mega large
orders to breaking up of deals to get better price advantage. This has
opened up opportunities for Indian IT companies to participate in these
large multi-million dollar deals. Global companies are expanding their
outsourcing activities to leverage the high quality, cost competitive IT
services from India.

We believe our strong brand, robust quality process and access to skilled
talent base at lower costs places us in a unique position to take advantage
of the trend towards outsourcing IT services.

We believe that our global delivery model allows us to provide services on
a best shore basis. Customers benefit from round the clock execution
schedules, quality control measures and best in class resources pooled in
across geographies for high quality delivery and risk management practices
to ensure uninterrupted services.

Risk factors:

Our revenues from this business are derived in major currencies of the
world while a significant portion of its costs are in Indian rupees. The
exchange rate between the Rupee and major currencies of the world has
fluctuated significantly in recent years and may continue to fluctuate in
the future. Currency fluctuations can adversely affect our revenues and
gross margins.

In an economic slowdown, our clients may reduce or postpone their
technology spending significantly. Reduction in spending on IT services may
lower the demand for our services and negatively affect our revenues and
profitability. According to World Economic Outlook Update published by
International Monetary Fund in April 2010, GDP of United States is
projected to grow by 3.1% in calendar 2010 and during the same period GDP
of Euro area is projected to grow by 1%.

The market for IT services is highly competitive. Our competitors include
software companies, IT companies, systems consulting and integration firms,
other technology companies and client in-house information services
departments. We may also face competition from IT and ITES companies
operation from merging low cost destination like China, Philippines,
Brazil, Romania, Poland etc.

Recently, some countries and organizations have expressed concerns about a
perceived association between offshore outsourcing and the loss of jobs.
With the growth of offshore outsourcing receiving increasing political and
media attention there have been concerted efforts to enact new legislation
to restrict offshore outsourcing or impose disincentives on companies which
have been outsourcing. This may adversely impact our ability to do business
in these jurisdictions and could adversely affect our revenues and
operating profitability.

These risks are broadly country risks. At an organisational level, we have
a well-defined business contingency plan and disaster recovery plan to
address these unforeseen events and minimize the impact on services
delivered from our development centers based in India or abroad.

We derive approximately 58% of our IT Services revenue from United States
and 26% of our IT Services revenue from Europe. The recent crisis in the
financial and credit markets in the United States, Europe have contributed
significantly to a global economic slowdown, with Europe continuing to show
significant signs of weakness and US showing signs of growth.

IT products:

Our IT Products segment provides a range of IT products encompassing
computing, storage, networking, security and software products. Under this
segment, we sell IT products manufactured by us and third-party IT
products. We provide our offerings to enterprises in the Government,
defence, IT and IT - enabled services, telecommunications/telecom service
providers, manufacturing and banking sectors.

For the last several years, India has achieved healthy economic growth
rates in the range 7.5-8%. The growth has been contributed by robust
services sector performance as well as cyclically strong manufacturing
output. Increased revenue and profitability growth has created
opportunities for companies to invest in IT infrastructure. Some sectors
such as Telecom service providers, Banking, Retail and IT/ITES require
significantly higher per capita IT investment.

India is being viewed as a key market among the emerging economies. Several
multinational IT Companies and Indian IT Services companies are focusing on
the Indian markets. This could affect our growth and profitability.

The IT products market is a dynamic and highly competitive market. In the
marketplace, we compete with both international and local providers. We are
witnessing higher pricing pressures due to commoditization of manufactured
products business and higher focus on Indian markets by all leading IT
companies.

We are favorably positioned due to our quality leadership, our ability to
create client loyalty and our expertise in select markets.

Consumer care and lighting:

Our Consumer Care and Lighting business segment focuses on niche profitable
market segments in personal care in specific geographies in Asia and
Africa, as well as office solutions in India. We successfully leverage our
brands and distribution strengths to sustain a profitable presence in the
personal care sector and housing lighting products. Our Santoor brand is
the third largest in India in the soap category, and Safi brand is the
largest Halal toiletries brand of Malaysia. With the acquisition of
Yardley, we have a stronger presence in the Middle East, and have made our
first foray into the luxury segment of personal care.

We have constantly expanded our brand portfolio by entering newer
categories. We have successfully built brands both organically and through
acquisition. Each brand in our Brand basket has a distinctive positioning,
catered to and addressing a specific consumer need.

Our competitors in the consumer care and lighting are located primarily in
India, and include multinational and Indian companies. Certain competitors
have recently focused on sales strategies designed to increase sales
volumes through lower prices. Sustained price pressures by competitors may
require us to respond with similar or different pricing strategies. This
may adversely affect our gross and operating profits in future periods.

Others:

Our Others segment includes our infrastructure engineering business. We are
the world's largest third-party manufacturer of hydraulic cylinders. The
Others segment is centered on our mobile construction equipment business
and our material handling business. We manufacture and sell cylinders and
truck hydraulics, and we also distribute hydraulic steering equipment and
pumps, motors and valves for international companies. We have a global
footprint in terms of manufacturing facilities in Europe and India and sell
to customers across the globe.

While the current financial year has seen a decline in global sales
volumes, we believe that the fundamentals of infrastructure engineering

business remain intact.

We are also in the water solutions business, which addresses the entire
spectrum of treatment solutions, systems and plants for water and waste
water for industries.

We also provide consulting on comprehensive renewable energy and efficiency
solutions.

If current slowdown is prolonged it would translate in to lower growth for
our customers and in turn reduce our growth prospects.

IV. Outlook:

During the financial year ending March 2010, we grew our Revenues by 6% to
Rs. 271,414 million and Profit After Tax (PAT) by 19% to Rs. 46,310
million. Over the last decade, we have grown our Revenues at the CAGR of
28% and PAT at the CAGR of 31%.

We have followed a practice of providing only revenue guidance for our
largest business segment, namely, IT Services. The guidance is provided at
the release of every quarterly earnings when detailed Revenue outlook for
the succeeding quarter is shared. Over the years, the Company has performed
in line with quarterly Revenue guidance.

On April 23, 2010, along with our earnings release for quarter ended March
31, 2010, we provided our most recent quarterly guidance. Revenue from IT
Services segment for the quarter ending June 30, 2010 is likely to be
ranged between USD 1,161-1,183 million on a constant currency basis.

V. Internal Control Systems and their adequacy:

We have presence across multiple countries, and a large number of
employees, suppliers and other partners collaborate to provide solutions to
our customer needs. Robust internal controls and scalable processes are
imperative to manage this global scale of operations.

Our listing on the New York Stock Exchange (NYSE) provided us an
opportunity to get our independent auditors assess and certify our internal
controls primarily in the areas impacting financial reporting. For the
companies listed in the United States of America, the Public Company
Accounting Reform and Investor Protection Act of 2002, more popularly known
as the Sarbanes-Oxley Act requires:

1. Management to establish, maintain, assess and report on effectiveness of
internal controls over financial reporting and;

2. Independent auditors to opine on effectiveness of internal controls over
financial reporting.

We adopted the COSO framework (Framework suggested by Company of Sponsoring
Trade way Organisation) for evaluating internal controls. COSO identifies
five layers of internal controls, namely, Control Environment, Risk
Assessment, Control Activity, Information and Communication and Monitoring.
Information Technology controls were documented, assessed and tested under
the COBIT framework.

The entire evaluation of internal controls was carried out by a central
team reporting into the Chief Financial Officer.

VI. Discussion on financial performance with respect to operational
performance:

1. Authorised share capital:

The Company has an authorised share capital of Rs. 3,550 million comprising
1,650 million equity shares of Rs. 2/- each and 25 million 10.25%
redeemable cumulative preference shares of Rs. 10/- each as of March 31,
2010.

2. Paid up Share Capital:

The Company has a paid-up capital of Rs. 2,934 million, an increase of Rs.6
million during this year.

The Company has instituted various Employee Stock Option Plans (ESOP).
These options vest over a specified period subject to employee fulfilling
certain conditions. Upon vesting, the employees are eligible to apply and
secure allotment of the Company's equity shares at a price determined on
the date of grant of options. During the year, 3.2 million shares were
allotted on exercise of the options under various Employee Stock Option
Plans instituted by the Company.

3. Reserves and Surplus:

A. Securities Premium Account:

Addition to securities premium account comprises of premium received on
exercise of stock options, amounting to Rs. 1,909 million.

B. Restricted Stock Units:

The Company has granted total 0.14 million restricted stock units under the
Wipro ADS Restricted Stock Unit Plan, 2004.

During the year ended March 31, 2010 the Company has charged to profit and
loss account Rs. 1,317 million of deferred compensation cost as employee
compensation. The cumulative charge to profit and loss account would be
treated as share premium on allotment of shares.

4. Secured Loan:

Secured loans have increased by Rs. 261 million, primarily on account of
securitization of receivable on recourse basis amounting to Rs. 752 Million
which is partly offset by repayment of loan amounting to Rs 491 Million.

5. Unsecured Loan:

Unsecured loans have increased by Rs. 5,360 million. The increase is mainly
due to additional PCFC loan availed in the current year, impact of
reinstating ECB loan (denominated in Japanese Yen) at the exchange rates
prevailing on March 31, 2010 and borrowings made for Delhi International
Airport (P) Limited asset acquisition.

6. Fixed Assets:

A. Goodwill on Consolidation:

The excess of consideration paid over the book value of assets acquired has
been recognised as goodwill in accordance with Accounting Standard (AS) 21
Consolidated Financial Statements'. Goodwill arising on account of
acquisition of subsidiaries and affiliates is not amortised but reviewed
for impairment if there are indicators of impairment. Upon review for
impairment, if the carrying value of the goodwill exceeds its fair value,
goodwill is considered to be impaired and the impairment is charged to the
income statement for the year.

Goodwill has decreased by Rs. 3,175 million during the year, of which
decrease of Rs. 4,877 million is mainly due to impact of reinstating
goodwill relating to non-integral overseas operations at the exchange rates
prevailing on March 31, 2010 and an increase of Rs.1,712 million on account
of acquisition of Yardley group.

B. Addition to Fixed Assets:

During the year, the Company invested Rs. 10,900 million on Fixed Assets.
The unit-wise spends are outlined below:

(Rs. in Million)

Business Unit 2010
IT services & products 9,774
Consumer Care and Lighting 711
Others 417

C. Depreciation:

The Company has provided depreciation either at the rates specified in
Schedule XIV of the Companies Act, 1956, or at commercial rates which are
higher than the rates specified in Schedule XIV. Depreciation as a
percentage of sales remained at 2% in fiscal year 2010.

7. Investments:

Purchase of Investments - During the year surplus cash generated by
operations were invested in short-term mutual funds and term deposits with
financial institutions. The internal investment norms restrict investments
to only those mutual funds which have corpus in excess of a specific
threshold and the investment is limited to a specified percentage of
overall investments of Wipro. Further, we place deposits only with those
institutions having a specified credit rating and we have internal limits
of maximum deposit that can be placed with financial institutions.
Investments in units of liquid mutual funds have increased from Rs. 15,136
million in fiscal 2009 to Rs. 19,147million in fiscal 2010. Investment in
Certificate of deposits have increased from Rs. 947 million in fiscal 2009
to Rs. 11,088 million in fiscal 2010.

8. Inventories:

Inventories comprises computers and spares of IT Products and raw material
and finished stocks of Wipro Consumer Care and Lighting and Wipro
Infrastructure Engineering (WIN). Inventories have increased from Rs. 7,587
million as on March 31, 2009 to Rs. 7,926 million as on March 31, 2010.

Inventory of IT products and Consumer care and lighting increased
respectively by Rs. 329 million and Rs. 324 million in line with growth in
revenues and inventories sourced to service large total outsourcing deals.
This was offset by Rs. 313 million decrease in inventory in WIN primarily
due to the reduction in business as result of economic slowdown.

9. Sundry Debtors:

Sundry Debtors (net of provision) for the current year is at Rs. 51,150
million against Rs. 50,370 million in the previous year. Segment-wise
break-up of sundry debtors is outlined below:

(Rs. in Million)

Particulars 2010 2009 Increase
(%)

IT Services and Products 46,622 47,188 (1)
Consumer Care and Lighting 3,000 2,414 24
Others 1,528 768 99
Total 51,150 50,370 2

Changes in sundry debtors in Consumer Care and Lighting and Others are in
line with the revenue growth during the quarter ended March 31, 2010.

Provision for doubtful debts has increased from Rs 1,919 million to
Rs.2,327 million in fiscal 2010. The provision for doubtful debts primarily
includes provision recorded upon a major customer opting for bankruptcy
protection.

10. Cash and Bank Balances:

Cash and bank balances have increased from Rs. 49,117 million to Rs. 64,878
million, an increase by Rs. 15,761 million. The increase is primarily to
meet operational requirements and pursue strategic acquisition
opportunities. The surplus cash is been primarily invested in demand
deposits.

11. Loans and advances:

(Rs. in Million)

Particulars 2010 2009 Increase
(%)

Advances recoverable 14,434 12,873 12
Unbilled revenue 16,708 14,108 18
Others 27,033 16,592 63
Total 58,175 43,573 34

* Increase in advance recoverable is primarily due to increase in net
investment in lease by Rs. 837 million. The net investment in lease
primarily relate to equipments delivered in certain large IT outsourcing
contracts in India. Further increase is mainly due to unamortized expenses
795 million.

* Unbilled revenue has increased on accordance of increase in revenues from
Fixed Price Projects from 34% in the previous year to 41.5% in the current
year in IT Services where certain customers are billed after the end of the
month. We have entered into several multi-year large deals (including
infrastructure) with Telecom companies where the billings are based on
milestones and with deferred payment terms.

* Increase of Rs. 10,441 million in 'Others' is mainly due to increase in
Advance tax by Rs. 1,902 million, deposits with financial institutions by
Rs. 5,800 million and derivative assets by Rs. 2,482 million.

12. Current Liabilities & Provisions:

A. Current Liabilities:

(Rs. in Million)

Particulars 2010 2009 Increase
(%)

Sundry Creditors 19,133 19,081 0
Advances from customers 1,786 824 117
Unearned revenues 7,462 8,734 (15)
Other Liabilities 28,961 37,830 (23)
Total 57,342 66,469 (14)

Sundry Creditors represent the amount payable to vendors and employees for
supply of goods and services.

Other liabilities comprise amounts due for operational expenses. Other
liabilities have decreased by Rs. 8,781 million during the year ended March
31, 2010 primarily due to Rs. 7,872 million decrease in derivative
liabilities relating to mark to market losses on derivative instruments
designated as cash flow/capital hedges and non-designated forward
contracts.

The remaining increase is primarily due to increase in subcontracting
expenses, administrative expenses, withholding taxes, employee incentives
which are in line with increase in employee base, infrastructure and
business growth.

B. Provisions:

(Rs. in Million)

Particulars 2010 2009 Increase
(%)

Employee retirement
benefits 2,967 3,111 (5)

Warranty provision 611 768 (26)

Provision for tax 7,915 6,493 18

Proposed Dividend 8,809 5,860 33

Tax on proposed dividend 1,283 996 22

Others 1,763 1,387 21

Total 23,348 18,615 20

* Provisions of Rs. 2,967 million for employee retirement benefit relate to
liability for employee leave encashment, gratuity and superannuation
benefits.

* For fiscal 2010, the Directors of the Company have proposed a cash
dividend of Rs. 6/- per share on equity shares.

Revenue:

IT Service:

Our IT Services segment Revenue was Rs. 202,469 million as compared to
Rs.191,661 million in the last year, a growth of 6% as compared to last
year.

During the current year, we realised 49.8% of revenue from work done in
locations outside India ('Onsite') and remaining 50.2% of revenue was
realised from the work performed from our development centers in India
('Offshore').

Onsite-Offshore Mix:

Approximately 41.5% of our IT Services Revenues were from Fixed Priced
Projects ('FPP'). In FPP, we undertake to complete project within agreed
timeline for a given scope of work. The economic gains or losses realised
from completing the project earlier or later than initially projected
timelines accrues to us. Percentage of FPP in the previous year was lower
at 34%.

Revenue Mix Vertical Distribution:

In the current year, 48% of our IT Services revenues is derived from our
Enterprise Solutions Business, 3% increase over the previous year; 26% from
Technology Business a reduction of 3% over the previous year and 26% of
Revenues from Financial Solutions Business, at the same level as compared
to last year.

Our Enterprise Solutions Business serves customers in all the other
industry segments, principal being Retail, Manufacturing, Energy &
Utilities, Healthcare Services. Our Technology Business provides product
engineering services to product companies across the globe. It also
provides enterprise IT services offering to Telecom Service Providers
industry. Our Financial Solutions Business provides IT services to
customers in Financial Services industry - namely, Banking, Securities and
Insurance.

Revenue Mix Vertical Distribution:

We continued to expand and grow our Services portfolio. For the current
financial year, we derived 21% of Revenues from Technology Infrastructure
Services, an increase of 1% from previous year; 12% from Testing Services
an increase of 1% from previous year; 13% from Package Implementation
Services, an increase of 1% from previous year; 11% from BPO an increase of
2% as previous year ; 37% from Application Development & Maintenance (ADM)
a reduction of 3% over the previous year; 2% Consulting Services, at the
same level in the previous year and 4% from product engineering, a
reduction of 2% over the previous year.

Based on geographical destination, 58% of our revenue came from the
Americas, a decrease of 2% as previous year ; 26% from Europe at the same
level as previous year. Revenue from Japan at 2%, a decrease of 1% from
previous year. Revenue from India and Middle East region at 8%, at the same
level as previous year. Rest of the World contributed 6%, an increase of 2%
over the previous year.

The contribution of our top customer is at the same level as in the
previous year. Our top customer contributed 2.6% of revenue, top 5
customers 11% of revenue, at the same level as previous year and the top 10
customers accounted for 20% of the revenue, at the same level as previous
year.

Revenue contributed by the customers added during the year was at 2%, at
the same level as in the previous year.

IT Product:

During the current year we grew our Products segment Revenues by 11%.

We grew across the board. Revenue from Personal Computers was 15% higher
than in the previous year, Enterprise Products grew 3% and our network
products dropped by 37%.

Consumer Care and Lighting segment:

Revenues of our Consumer Care and Lighting segment grew by 14% in the
current year over the previous year.

Our revenue CAGR during last 4 years in this business has been 18%
excluding acquisition during the year. Our flagship brand Santoor' is now
India's 3rd largest soap brand by value.

Others segment:

Revenues from Wipro Infrastructure Engineering (WIN) reduced by 20% during
the current year over the previous year. This is mainly due to lower demand
of capital goods in the current year due to economic slowdown.

Acquisitions:

Details of the key acquisitions made by your Company during the year ended
March 31, 2010 are as follows:

Acquired Entity Acquired Nature of business
during

Consumer Care & Lighting Business:

1. Lornamead FZE Dec-09 Personal care category
with fragrance products,
bath & shower products
and skin care.

2. Lornamead Personal Dec-09 Personal care category
Care Private Limited with fragrance
products, bath &
shower products and
skin care.

In addition, the company has paid Rs. 2,385 million relating earn-outs
related to previous acquisitions.

Costs:

IT Services:

In our IT Services Business segment, manpower cost accounts for
approximately 50% of the Revenues. Other major costs included Sub-
contracted manpower cost, depreciation and employee-travel cost.

The operational drivers for these costs are Utilisation of employees,
Onsite: Offshore composition and the composition of experience profile of
employees called Bulge-mix'.

During the current year gross Utilisation was 72% compared to 69% an year
ago. As of March 31, 2010 approximately 40% of our employees had less than
3 years of work-experience, as compared to 47% as of March 31, 2009.

IT Product:

In our IT Products segment, material cost as a percentage of revenue was at
approximately 89%.

Consumer Care and Lighting:

In our Consumer Care and Lighting segment, the largest cost is packing
material and manufacturing cost, accounting for 46% of the Revenues. Other
key costs include advertising and sales promotion at 18% of Revenues and
manpower cost at 8% of the Revenues.

Others:

In this segment WIN is the largest component. For WIN the largest cost
component is raw materials, accounting for approximately 63% of the
Revenues, Material and manufacturing costs taken together accounts for 64%
of the Revenues. Other key costs include manpower cost at 26% of Revenues
and cost of sub-contracted processes at 5% of the Revenues.

Margins:

IT Services:

The gross margin was 35%, an increase of 3% in comparison to last year. The
improvement in gross margin as percentage of revenue is primarily on
account of improvement in average USD/INR realization and improvement in
utilization rates. Our average utilization of billable employees improved
from 69% for the year ended March 31, 2009 to 72% for the year ended March
31, 2010. These improvements were offset by the increase in personnel costs
due to annual salary increase.

At the Operating Margin (Profit before interest and tax) level the margins
have increased by 2.6%, from 21.0% in last year to 23.6% for financial year
2010.

IT Products:

In this segment our gross margins for the current year was 11% constant
compared to the last year. Our gross margin in this business segment
increased mainly due to increase in proportion of revenues from outsourcing
and system integration contract, which was offset by increase in personnel
costs due to annual salary increase. Is is also impacted by the proportion
of our business derived from the sale of traded and manufactured products.

Operating Margins during the year were at 4.6%, an increase of 0.3%
compared to previous year.

Consumer Care and Lighting:

Our gross margin for this year was at 49% for this segment compared to 44%
in the previous year. The expansion in gross margin is primarily due to a
decrease in major input costs and a change in mix of products sold in
favour of products which typically have higher gross margins in both Indian
and South Asian markets.

Operating Margins for the current year was 13%, an increase of 0.8%
compared to previous year.

Others:

Operating Margins for our Wipro Infrastructure Engineering business for the
current year was -10% against -2.5% in last financial year. This sector is
impacted by sharp global slowdown in investment in multiple sectors, driven
by economic uncertainty. However, fundamentals of this sector remain
intact. Infrastructure spends in India, China and US would positively
impact this business.

VII. Liquidity and interest rate risk:

As of March 31, 2010, we had cash and bank balances of Rs. 64,878 million,
investments in liquid and short-term mutual funds and certificate of
deposits of Rs. 30,235 million.

This cash is retained in the business to ensure specified level of cash
balance to manage operations and pursue strategic acquisition
opportunities. Our investment policy is to protect capital and focus on
liquidity while determining the class of instruments to invest in. We
primarily invest in debt mutual funds and deposits with financial
institutions.

VIII. Material developments in Human resources/Industrial:

Relations front (including number of people employed) In our IT Services
and Products Business segments, we had 108,071 employees, comprising 25,649
employees in BPO.

Attrition for the year in our IT Services business segment (excluding BPO
operations, Indian IT operations and other overseas subsidiaries) was 13.6%
compared with 13.2% last year. Voluntary attrition stood at 12.1% compared
with 11.3% last year, while involuntary attrition was 6% compared with 8%
last year.

Compensation/People practices:

We have continued to develop innovative methods for accessing and
attracting skilled IT professionals. We partnered with a leading Indian
university to establish a program for on the job training and a Masters
degree in software engineering. We believe that our ability to retain
highly skilled personnel is enhanced by our leadership position,
opportunities to work with leading edge technologies and focus on training
and compensation. In February 2007, we were awarded the Dale Carnegie
Global Leadership Award in recognition of our emphasis on the development
of human resources, innovation and organizational creativity.

We have designed our compensation to attract and retain top quality talent
and motivate higher levels of performance. Our compensation packages
include a combination of salary, stock options, pension, and health and
disability insurance. We have devised both business segment performance and
individual performance linked incentive programs that we believe more
accurately link performance to compensation for each employee. We measure
our compensation packages against industry standards and seek to match or
exceed them. We periodically reward high performers with long-term
incentives in the form of restricted stock units (RSU). RSU is a powerful
retention tool and aligns employees with the long-term goals of the
Company.