Wipro shares in focus after IT major posts mixed results. Here's what to do with the stock

On Friday, Wipro sequential growth of almost 15 per cent in net profit to Rs 3,052.9 for the October-December period.

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Wipro shares were in focus on Monday after the country's fourth largest IT company by market value last week reported a mixed set of results for the October-December period. Analysts largely have negative views on the stock. Check out what CLSA, Jefferies and Nomura recommend on the Wipro stock.

Brokerages	Rating	Price Target
Morgan Stanley	Underweight	INR 375
Nomura	Neutral	INR 425
Jefferies	Underperform	INR 355
BoFA	Underperform	INR 395
JP Morgan	Underweight	INR 370
CITI	Sell	INR 375
CLSA	Outperform	INR 450

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Jefferies maintained an 'underperform' rating on Wipro though raised its target price by Rs 5 to Rs 355. The company beat estimates due to a sharp rise in margin but posted muted revenue growth despite healthy deal wins, according to the brokerage.

Nomura maintained a 'neutral' call with a target price of Rs 425 apiece, saying growth was hurt by furloughs and lower discretionary spends. The brokerage expects near-term weakness citing increasing deal tenures leading to delay in translation to immediate growth.

CLSA maintained 'outperform' on the IT stock with a target of Rs 450 apiece though Wipro's quarterly revenue fell short of the brokerage's estimates. The brokerage remains hopeful of margin expansion for the company in the year ending March 2024, and highlighted the company's strong order book and upbeat management commentary.

On Friday, Wipro sequential growth of almost 15 per cent in net profit to Rs 3,052.9 for the October-December period. Its revenue in rupee terms grew more than three per cent on a quarter-on-quarter basis to Rs 23,229 crore, according to a regulatory filing. Dollar revenue remained flat at $2,803.5 million.

According to Zee Business research, Wipro was estimated to report a net profit of Rs 2,900 crore and revenue of Rs 23,280 crore.

The IT services operating margin for the quarter was at 16.3 per cent, improving 120 basis points sequentially.

Anil Singhvi’s Strategy On Wipro

Wipro shares on Monday opened in-line with expectations, Zee Business Managing Editor Anil Singhvi said in his comment. He noted that the stock should be bought at dips after it cracks for 4-5 per cent, advising investors to wait for right opportunity to take position in the counter.

Wipro share price on Monday opened flat at Rs 394 apiece and eventually gaining momentum, it surged almost 2 per cent to touch a day’s high of Rs 400.8 per share on the BSE. In comparison, the S&P BSE Sensex is trading flat with positive bias at around 09:53 am today.

(READ MORE ON WIPRO RESULTS HERE)

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