The share price of Wipro tanked 4.25% to Rs 390.10, a day after the company posted second-quarter profit at Rs 2,646.30 crore, down 0.5% as against Rs 2,659.00 crore during the same period last year. Wipro saw its attrition falling to 15.5% in the September quarter, from 17.3% in the June quarter. Utilisation for Wipro has, however, improved to 84.5% in the September quarter. The company said it is paying a standard 80% variable pay to its employees in Q2.
Wipro’s share price fell 4.45% in the last five days, 8.34% in the last one month, while it gained 9.28% in the last six months and 4.30% in the last one year.
Should you buy, sell or hold Wipro shares?
Motilal Oswal Financial Services: Neutral – Target Price: Rs 418
“Given WPRO’s weak 2QFY24 revenue growth and weak 3Q guidance, we expect its FY24 topline growth to be one of the lowest among Tier-1 IT Services peers, with margin below the management’s medium-term guided range of 17.0-17.5%. We cut our FY24E/FY25E EPS by 8.2%/5.0% to factor in weaker FY24 growth. We maintain our Neutral rating as we await: further evidence of the execution of WPRO’s refreshed strategy, and a successful turnaround from its struggles over the last decade before turning more constructive on the stock. Our Target Price of Rs 418 implies 18x FY25E EPS.”
Choice Broking: Add – Target Price: Rs 445
“Wipro is investing in technology infrastructure, optimizing operations, and enhancing delivery to foster profitable growth. The company is focused on training and upskilling the workforce to prepare them for an AI-driven future. The investments in the AI360 strategy are yielding substantial efficiencies across the organization. The company is confident that these investments will bolster its resilience and competitiveness in the ever-changing business and economic landscape. We have introduced FY26E and expect Wipro to deliver a Revenue/EBIT/PAT CAGR of 4%/9%/9% respectively over FY23-FY26E. We upgrade our rating to ‘Add’ with a revised Target Price of Rs 445, implying a 16.5x (unchanged) PE on FY26E EPS of Rs 27.
JM Financial: Buy – Target Price: 450
“We lower Wipro’s FY24-26E USD revenue by 4-5% and EPS by 3-6% as we build a weaker than expected near-term growth outlook. That said, Wipro– owing to higher consulting/BFS exposure – could be first off the block when demand turns. Besides, an undemanding valuation (16x FY25E EPS) is in its favour. We therefore remain constructive, though are cognizant of lack of immediate triggers. Maintain ‘Buy’ with an unchanged Target Price of Rs 450.
(The recommendations in this story are by the respective research analysts and brokerage firms. FinancialExpress.com does not bear any responsibility for their investment advice. Capital markets investments are subject to rules and regulations. Please consult your investment advisor before investing.)