{"url_path":"/sec/wit/10-k/2026/item-11","section_key":"item-11","section_title":"Item 11 Quantitative and Qualitative Disclosures About Market Risk","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-02","source_url":"https://www.sec.gov/Archives/edgar/data/1123799/0001193125-26-253514-index.html","accession_number":"0001193125-26-253514","cik":"0001123799","ticker":"WIT","issuer_name":"WIPRO LTD","edgar_url":"https://www.sec.gov/Archives/edgar/data/1123799/0001193125-26-253514-index.html","primary_entity_key":"0001123799","primary_entity_name":"WIPRO LTD"},"word_count":1169,"has_tables":true,"body_markdown":"Item 11. Quantitative and Qualitative Disclosures About Market Risk\n\nMarket Risk\n\nMarket risk is the risk of loss of future earnings to fair values or to future cash flows that may result from a change in the price of a financial instrument. The value of a financial instrument may change as a result of changes in the interest rates, foreign currency exchange rates and other market changes that affect market risk sensitive instruments. Market risk is attributable to all market risk sensitive financial instruments including investments, foreign currency receivables, payables and loans and borrowings.\n\nOur exposure to market risk is a function of investment and financing activities and revenue generating activities in foreign currency. The objective of market risk management is to avoid excessive exposure of our earnings and equity to losses. Please refer to the “Financial risk management” section of Item 18 of this Annual Report on Form 20-F for further details on market risk.\n\nRisk Management Procedures\n\nWe manage market risk through a corporate treasury department, which evaluates and exercises independent control over the entire process of market risk management. Our corporate treasury department recommends risk management objectives and policies, which are approved by senior management and the Audit, Risk and Compliance Committee. The activities of this department include management of cash resources, implementing hedging strategies for foreign currency exposures, borrowing strategies, and ensuring compliance with market risk limits and policies.\n\nComponents of Market Risk\n\nForeign currency risk\n\nWe operate internationally and a major portion of our business is transacted in several currencies. Consequently, we are exposed to foreign exchange risk through receiving payment for sales and services in the U.S. and elsewhere, and we make purchases from overseas suppliers in various foreign currencies. The exchange rate risk primarily arises from foreign exchange revenue, receivables, cash balances, forecasted cash flows, payables and foreign currency loans and borrowings. A significant portion of our revenue is in the U.S. Dollars, Pound Sterling, Euro, Indian Rupees, Australian Dollars and Canadian Dollars while a large portion of our costs are in Indian Rupees. The exchange rate between the Indian Rupee and these currencies has fluctuated significantly in recent years and may continue to fluctuate in the future. Appreciation of the Indian Rupee against these currencies can adversely affect our results of operations.\n\nWe evaluate our exchange rate exposure arising from these transactions and enter into foreign currency derivative instruments to mitigate such exposure. We follow established risk management policies, including the use of derivatives like foreign exchange forward/option contracts to hedge forecasted cash flows denominated in foreign currency.\n\nWe designate certain derivative instruments as cash flow hedges to mitigate the foreign exchange exposure of forecasted highly probable cash flows. From time to time, we may also designate foreign currency denominated borrowings as a hedge of net investment in foreign operations.\n\nAs of March 31, 2026, a ₹ 1 increase in the spot exchange rate of the Indian Rupee with the U.S. Dollar would result in an approximately ₹ 2,756 million (including consolidated statement of income of ₹ 683 million and other comprehensive income of ₹ 2,073 million) decrease in the fair value, and a ₹ 1 decrease would result in an approximately ₹ 2,743 million (including consolidated statement of income of ₹ 683 million and other comprehensive income of ₹ 2,060 million) increase in the fair value of foreign currency dollar denominated derivative instruments (forward and option contracts).\n\nInterest rate risk\n\nInterest rate risk primarily arises from floating rate borrowings, including various revolving and other lines of credit.\n\nOur investments are primarily in short-term investments, which do not expose us to significant interest rate risk.\n\nInterest rate risk primarily arises from floating rate borrowing, including various revolving and other lines of credit. If interest rates were to increase by 100 bps as of March 31, 2026, additional net annual interest expense on floating rate borrowing would amount to approximately ₹ 799 million. Certain borrowings are also transacted at fixed interest rates.\n\n-103-\n\n[Table of Contents](#toc_page)\n\n \n\nCredit risk\n\nCredit risk arises from the possibility that customers may not be able to settle their obligations as agreed. To manage this, we periodically assess the credit rating and financial reliability of customers, considering the financial condition, current economic trends, forward-looking macroeconomic information, analysis of historical bad debts and ageing of accounts receivable. No single customer accounted for more than 10% of the accounts receivable as of March 31, 2026 or revenues for the fiscal year ended March 31, 2026. There is no significant concentration of credit risk.\n\nTrade receivables and unbilled receivables are written off where there is no reasonable expectation of recovery. Indicators that there is no reasonable expectation of recovery include, amongst others, the failure of a customer to engage in a repayment plan with the Company.\n\nPlease refer to Note 9 of our Notes to the Consolidated Financial Statements for changes in allowances for lifetime expected credit loss.\n\nCounterparty risk\n\nCounterparty risk encompasses issuer risk on marketable securities, settlement risk on derivative and money market contracts and credit risk on cash and time deposits. Issuer risk is minimized by only buying securities in India which are at least AA rated by Indian rating agencies. Settlement and credit risk is reduced by the policy of entering into transactions with counterparties that are usually banks or financial institutions with acceptable credit ratings. Exposure to these risks are closely monitored and maintained within predetermined parameters. There are limits on credit exposure to any financial institution. The limits are regularly assessed and determined based upon credit analysis including financial statements and capital adequacy ratio reviews.\n\nCash and cash equivalents include demand deposits of ₹ 3,546 million and bank balances of ₹ 83,293 million held with two banks having high credit ratings, which are individually in excess of 10% or more of the Company’s total cash and cash equivalents as of March 31, 2026. Please refer to Note 11 of our Notes to the Consolidated Financial Statements for more information.\n\nWe did not have any significant concentration of investment risk, as no investments with any single counterparty exceeded 10% of our total investments as of March 31, 2026. Please refer to Note 8 of our Notes to the Consolidated Financial Statements for more information.\n\nLiquidity risk\n\nLiquidity risk is defined as risk that we will not be able to settle or meet our obligations on time or at a reasonable price. Our corporate treasury department is responsible for liquidity and funding as well as settlement management. In addition, processes and policies related to such risks are overseen by senior management. Management monitors our net liquidity position through rolling forecasts based on the expected cash flows. As of March 31, 2026, our cash and cash equivalents are held with major banks and financial institutions. Please refer to the “Liquidity and Capital Resources” section of Item 5 of this Annual Report on Form 20-F and Note 19 of our Notes to the Consolidated Financial Statements for further details on assessment of our liquidity position.\n\n-104-\n\n[Table of Contents](#toc_page)"}