In Monday’s trading session, the shares of a leading technology services and consulting company dipped by 8.8 percent on BSE to Rs. 508.25, after reporting financial results for Q1 FY24-25 as well as flat sequential growth guidance.
At 10:04 a.m., the shares of Wipro Limited were trading in the red at Rs. 510.5 down by 8.4 percent, as against its previous closing price of Rs. 557.25, with a market cap of Rs. 2.67 lakh crore.
What’s the News:
The fluctuations in the share prices were observed after the company announced the financial results for Q1 FY24-25, through the recent filings with the stock exchanges on Friday post-market hours.
Revenue from operations for Q1 FY24-25 stood at Rs. 21,963 crore, marking a 1.1 percent QoQ decline from Rs. 22,208 crore in Q4 FY23-24, and a 3.8 percent fall year-on-year from Rs. 22,831 crore in Q1 FY23-24.
Wipro witnessed a 5.2 percent YoY rise in net profit, climbing from Rs. 2,886 crore in Q1 FY23-24 to Rs. 3,036.6 crore in Q1 FY24-25, as well as a 6.2 percent quarter-on-quarter increase in profit after tax (PAT), jumping from Rs. 2,858.2 crore in Q4 FY23-24 to Rs. 3,036.6 crore in Q1 FY24-25.
Total bookings stood at $3,284 million, and large deal bookings were at $1,154 million, a decrease of 3.1 percent QoQ and 3.6 percent YoY.
Total Bookings refers to the total contract value of all orders booked during the period, including new orders, renewals, and increases to existing contracts, while large deal bookings consist of deals greater than or equal to $30 million in total contract value.
IT services segment revenue was at $2,625.9 million, a decrease of 1.2 percent QoQ and a decrease of 5.5 percent YoY.
In Q2 FY24-25, Wipro expects revenue from its IT Services business segment to be in the range between $2,600 million and $2,652 million, translating to a sequential guidance of a (-)1.0% to +1.0% in constant currency terms.
Brokerages target on Wipro:
Citi maintains a ‘sell’ recommendation with a price target of Rs. 495, highlighting Wipro’s growth differential compared to peers and the resultant valuation differential will also stay.
Morgan Stanley is ‘underweight’ on Wipro with a target price of Rs. 459, noting early signs of recovery but emphasising the need for improved execution to benefit from these opportunities.
Among 44 analysts that have coverage on the stock, opinions are divided: 23 have a ‘sell’ or equivalent rating, 12 recommend ‘hold’, while 9 analysts recommend ‘buy’ ratings on the stock.
Stock performance:
The stock has delivered positive returns of nearly 26.3 percent in one year, as well as around 8.7 percent returns in the last six months. So far in 2024, the shares of Wipro have given about 7 percent of positive returns.
About the company:
Wipro Limited, a Bengaluru-based global information technology (IT), consulting and business process services (BPS) company, is engaged in providing traditional IT services offerings including consulting, managed services, and cloud infrastructure services as well as business process outsourcing as a service.
Written by Shivani Singh
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