Buy Wipro: target of Rs 510: Sharekhan
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Sharekhan's research report on Wipro
Revenue was broadly in-line, margin beat our estimates; CC revenue grew 3.4% q-o-q, while EBIT margin for IT services expanded 246 bps q-o-q to 21.7%; cash conversion remained strong. Wipro provided marginally better-than-expected growth guidance of 1.5-3.5% q-o-q for Q4FY2021E; EBIT margin to sustain in the medium-term despite higher investments, aided by revenue growth and higher offshoring mix. We expect Wipro's revenue growth trajectory to significantly exceed historical levels in FY2022E and FY2023E, because of strong deal wins, a robust deal pipeline and its full service model.
We maintain our Buy rating on Wipro with a revised PT of Rs. 510 given large deal wins and speedy decisions on strategic changes across organisation for improving growth trajectory.
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