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What should investors do with Wipro stock after Q2 results: Buy, sell or hold?

Gross revenue increased 7.8 percent sequentially to Rs 19,760.7 crore during the period, and 30.1 percent year-on-year (YoY).

October 14, 2021 / 10:07 AM IST
 
 
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Wipro share price touched a 52-week high of Rs 722.80, rising more than 7 percent in the early trade on October 14 after the company announced its September quarter earnings on October 13.

Wipro reported a consolidated net profit of Rs 2,930.7 crore for the quarter ended September 2021, thus registering a decline of 9.6 percent due to contraction in margins after wage hike and amortisation charge on Capco acquisition.

However, the profit grew by 18.9 percent compared to the corresponding quarter last fiscal.

Gross revenue increased 7.8 percent sequentially to Rs 19,760.7 crore during the period, and 30.1 percent year-on-year (YoY).

IT services operating margin for the September 2021 quarter was at 17.8 percent, a decline of 104 bps as compared to the previous quarter, and fell 140 bps YoY.

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Here is what foreign brokerages have to say about the stock and the company post September quarter earnings:

UBS | Rating: Neutral | Target: Rs 660

The Q2 revenue & Q3 guidance is in-line, while lower TCV offsets margin beat.

Given in-line guidance & lower TCV, UBS expect a muted reaction to the stock.

Macquarie | Rating: Outperform | Target: Raised to Rs 780

Macquarie kept outperform rating as strong execution led to a revenue beat in Q2.

The deal wins remain healthy with USD 580 million of wins in Q2 and raise FY22-24 EPS estimates by 2-3 percent, said Macquarie.

JPMorgan | Rating: Neutral | Target: Rs 670

JPMorgan raises revenue by 1% over FY22-24 but maintain margin over FY23-24.

The lack of sustained performance history & dropping large deals keep us conservative and full valuation of 29x keeps us neutral.

At 09:22 hrs Wipro was quoting at Rs 720.50, up Rs 47.95, or 7.13 percent on the BSE.

Disclaimer: The above report is compiled from information available on public platforms. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Moneycontrol News
first published: Oct 14, 2021 10:04 am

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