Software services major Wipro's fourth quarter (January-March) net profit grew 4.3% quarter-on-quarter to Rs 1,375 crore.Its quarterly revenues came at Rs 8,302 crore, up 6% sequentially.
Speaking to CNBC-TV18, Sandip Agarwal, IT analyst from Antique Stock Broking gave his readings and outlook for Wipro post its quarterly numbers. Below is the verbatim transcript of his interview with Udayan Mukherjee and Mitali Mukherjee of CNBC-TV18. Also watch the accompanying videos. Q: What did you make of the guidance for the next quarter for the first quarter which seems to have disappointed to the street a bit? A: We were negative on Wipro before the results also. Primarily, if you see, guidance is very muted, 1.5%. If you see Infosys has guided 3.5% on a sequential basis. But, even if you take the revenue guidance to be muted and even if we keep that aside, in this quarter also, all the matrixs have also not shown any improvement. If you see voluntary attrition has gone of by 110 basis points. The involuntary attrition has gone up by 30 basis points. Involuntary attrition is a very negative sign if it goes up, because it will definitely trigger your voluntary attrition for two quarters or three quarters. So, you will have more attrition going ahead and also that will impact your utilization level. So the EBITDA margin which has declined in this quarter if you see that is going to decline further, in next two quarters by at least 30-40 basis points. On operation matrix funds they have not done well at all. We are concerned about both attrition and utilization by going through the results. Also revenue guidance is very muted if you compare it with this trade, most of the companies have even given very good guidance for Q1 comparatively. So, it is really disappointing. Q: So to fill in the check boxes with these guidances what are you going with in terms of price target and earnings that Wipro can do? A: My best estimate gives me Rs 24 at maximum for FY12 in Earnings Per Share (EPS) and Rs 27 for FY13. If I give 17 multiple to FY12 and 16 multiple to FY13, we get a target of Rs 432. So, according to me that is the maximum target wise we can give to Wipro as of now. Also Read Expect integration with SAIC to be consummated in Q1: WiproDiscover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
