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Friday, January 28, 2022

Wipro Outlook: Wipro shares fall by 6%, poor results spoiled investors’ mood, experts gave this advice to investors

Wipro Outlook: Due to weak results contrary to the estimates in the December quarter, the shares of the giant IT company Wipro fell about 6 percent today.

Wipro Outlook: Due to weak results contrary to estimates in the December quarter, the shares of the giant IT company Wipro fell about 6 percent today (January 13). The company had a consolidated net profit of Rs 2969 crore in October-December 2021, which remained almost the same as in December 2020. However, the company’s revenue from operations stood at Rs 20,313 crore with a jump of about 29.6 per cent year-on-year. The next day after the announcement of the results of Wipro, the price of Wipro slipped to a price of Rs 648, down more than 6 percent. Brokerage firms have mixed opinions about investing in its shares.

Wipro’s board has approved an interim dividend of Re 1 per equity share to the members of the company. The record date for this has been fixed on 24 January and interim dividend will be paid on or before 5 February.

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IDBI Capital: HOLD
Target Price: Rs 780

In the third quarter October-December 2021 of the current financial year 2021-22, Wipro’s revenue grew at the rate of 3 per cent in constant currency term and its margins remained below the estimates of IDBI Capital. However, the brokerage firm believes that the new CEO’s strategy of retaining a global delivery executive and hiring new people for faster growth seems to be working. Apart from this, the investment outlook in this is looking positive due to the boom in the IT industry, 27 per cent year-on-year growth in order book and accelerating organic growth. However, for now its stock may have to wait for a long time. In such a situation, the brokerage firm has held its rating by reducing the rating to the target price of Rs 780.

Parbhudas Liladher: BUY
Target price: Rs 737

After missing the revenue target for the December 2021 quarter, Prabhudas Lilladher has cut Wipro’s revenue estimates by 1.5 per cent for the financial year 2023/24. The company’s management specifically mentioned that Q3 attrition has stabilized and may moderate in the coming quarters. In such a situation, brokerage firms believe that margins are likely to increase in the next financial year. In view of this, Prabhudas Lilladher has advised to buy this stock at a target price of Rs 737. However, the brokerage firm also said that investors should pay attention to any sharp selling in it.

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Kotak Securities: REDUCE
Target price: Rs 665

Wipro’s revenue figure for the December 2021 quarter was lower than the estimates of Kotak Securities. The company has made significant changes in the organization structure, improved leadership profile and bench strength and has put more emphasis on large deals. Due to all this, the brokerage firm believes that organic revenue growth can be 15.1 percent in FY 2022. Kotak Securities has retained Wipro’s revenue and EPS estimates in view of the company’s better growth forecast. However, the changes or corrections made by the company may have adverse effects and the December quarter results confirm this. Kotak Securities has retained its reduce rating but has increased the fair value from Rs 625 to Rs 665.
(Article: Harshita Tyagi)

(The stock recommendations given in the story are those of the respective research analysts and brokerage firms. Financial Express Online takes no responsibility for the same. Investments in capital markets are subject to risks. Please consult your advisor before investing.)

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