Motilal Oswal has come out with its first quarter (April-June) earnings estimates for the technology sector. The brokerage house expects Wipro to report a 7.2 percent degrowth quarter-on-quarter (degrowth of 5.2 percent year-on-year) in net profit at Rs 2073.8 crore.
Sales are expected to increase by 3.1 percent Q-o-Q (up 14.9 percent Y-o-Y) to Rs 14059 crore, according to Motilal Oswal
Earnings before interest, tax, depreciation and amortisation (EBITDA) are likely to fall by 0.4 percent Q-o-Q (up 7.2 percent Y-o-Y) to Rs 2792.8 crore.
Motilal Oswal's report on Wipro
We expect revenue growth of 2.1 percent in constant currency terms (2pp from acquisitions and 0.1pp organic), and a positive impact of 40bp on account of appreciation of currencies against the USD. In 4Q, WIPRO had guided for 1-3 percent Q-o-Q growth in 1Q, which included the two-month integration of HPS, which implied -1 to +1 percent Q-o-Q organic growth. We expect EBIT margin in IT Services to decline by 160bp because of the impact of the integration of HPS and visa expenses. We expect overall EBIT margins to decline by 70bp because of improved profitability in the Products business. Our PAT estimate is Rs 20.7b, -7.2 percent Q-o-Q on account of lower margins and lower forex gain compared to the previous quarter.Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
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