IT company Wipro Ltd reports 4% growth in its consolidated profit 3,092.5 crore in the fourth quarter as compared to 2,974 crore in the same period a year ago. Bengaluru-based company’s consolidated revenue from operations up 28% 20,860 crore to 16,245 crores.
Wipro expects revenue in the range of $2.74 billion to $2.80 billion for the first quarter ending June 30. This translates to sequential growth of 1-3%, which is lower than the 2-4% directed for the March quarter.
People of Motilal Oswal maintained neutral rating on Wipro Sharewith a target price of 540, as they await further evidence of the implementation of Wipro’s fresh strategy, and a successful turnaround from its growth struggles over the past decade, before getting more constructive on the stock.
“Its margins are likely to remain below the medium-term guided range of 17-17.5%. Further, its capital allocation has started to get impacted due to increased investment in consulting capabilities and should also impact FY23E payments,” the note said.
According to Prabhudas Lilladher, Wipro’s new strategy and investments are progressing well – 60 synergy deals with Capco, close to 16% more senior leaders in customers and 30% growth in cloud ecosystem in FY22. However, material large/mega deal wins from 2QFY23 or an increase in organic revenue guidance will be the key triggers for the stock to move higher. The brokerage house maintains a buy rating on the IT stock with a price target of Rs. 616 per share.
Another brokerage firm Nirmal Bang has reduced its target PE multiple from 19.4x to 18.2x. Maintain an ‘accumulate’ stance on 501 and Wipro.
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