Buy Wipro; target of Rs 490: Firstcall Research

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Buy Wipro; target of Rs 490: Firstcall Research

Firstcall Research is bullish on Wipro and has recommended buy rating on the stock with a target of Rs 490 in its February 2, 2012 research report.

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Firstcall Research is bullish on Wipro and has recommended buy rating on the stock with a target of Rs 490 in its February 2, 2012 research report.

"Wipro Limited is the first PCMM Level 5 and SEI CMM Level 5 certified IT Services Company globally. In the Asia Pacific and Middle East markets, Wipro provides IT solutions and services for global corporations. Wipro's ADSs are listed on the New York Stock Exchange, and its equity shares are listed in India on the Stock Exchange, Mumbai and the National Stock Exchange, among others. Wipro Ltd provides comprehensive information technology (IT) solutions and services, including systems integration, information systems outsourcing package implementation, software application development and maintenance, and research and development services to corporations globally through its IT services, solutions and products division."

"Wipro Ltd has posted a consolidated result for the quarter ended December 31, 2011. During the quarter, the company has posted a net profit of Rs 14564.00 million for the quarter ended December 31, 2011 as compared from Rs 13188.00 million for the quarter ended December 31, 2011, rise of 10.43%. Net sales are surged by 27.69% to Rs. 99972.00 million from Rs.78293.00 million same quarters last year. Company posted earnings of Rs. 5.93 a share during the quarter, registering 10.23% increment over prior year period. During the quarter, Net Sales rose by 27.69% to Rs. 99972.00 million from Rs.78293.00 in the same the quarter last year and the Total Profit for quarter ended December 2011 was Rs.14564.00 million grew by 10.43% from Rs.13188.00 million compared to same quarter last year."

"At the current market price of Rs.425.00, the stock is trading at 18.08 x FY12E and 15.64 x FY13E respectively. Earning per share (EPS) of the company for the earnings for FY12E and FY13E is seen at Rs. 23.17 and Rs. 26.79 respectively. Net Sales and PAT of the company are expected to grow at a CAGR of 17% and 13% over 2010 to 2013E respectively. On the basis of EV/EBITDA, the stock trades at 12.20 x for FY12E and 10.62 x for FY13E. Price to Book Value of the stock is expected to be at 3.48 x and 2.85 x respectively for FY12E and FY13E. We expect that the company will keep its growth story in the coming quarters also. We recommend 'BUY' in this particular scrip with a target price of Rs 490 for medium to long term investment," says Firstcall Research report.  

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To read the full report click on the attachment