Neutral Wipro; target of Rs 500: Motilal Oswal

Motilal Oswal's research report on Wipro

WPRO appointed Mr. Thierry Delaporte as CEO in FY21 on completion of Mr. Abidali Neemuchwala’s five-year term. With the change in CEO, it also embarked on further simplification of the organization structure. - The company has reorganized the IT Services segment from seven industry verticals to four SMUs – Americas 1, Americas 2, Europe, and APMEA. Americas 1 and 2 are primarily organized by industry sector, while Europe and APMEA are organized by countries. WPRO is undertaking a drastic restructuring of its business, reducing layers, and splitting the business by region. It expects this to result in a much more agile and nimble organization, which will accelerate growth.

Outlook

We maintain our Neutral stance as we await: a) further evidence of execution of WPRO’s refreshed strategy, and b) successful turnaround from its growth struggles over the last decade before turning more constructive on the stock. Our TP implies 21x FY23E EPS.

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