Most brokerages 'neutral' on Wipro revival plan

Mumbai: Most brokerages have a neutral to sell recommendation on Wipro even as the company's management pointed to simplification of the organizational structure and increasing focus on sales momentum as some of the key steps being taken to drive efficiencies and growth.

This plan was shared by the company's management at its analysts day event.

Morgan Stanley maintained an underweight rating on the stock with a target price of Rs 315 and said the market will wait to see some improvement in performance to gauge the strategy's success.

Motilal Oswal maintained a neutral rating with a target price of Rs 385 as it awaits further evidence of execution of Wipro’s refreshed strategy and a successful turnaround from its growth struggles over the last decade, before turning constructive on the stock.

Jefferies has also highlighted similar concern on execution. "Wipro has identified its priority verticals/markets in which it will intensify its focus on large accounts, large deal wins through a solution sales approach. It has simplified its operating model into 4 strategic business units which suits its current approach well. While the strategy seems right, its execution will be challenging," said Jefferies, maintaining an underperform rating with a target price of Rs 310.

Nomura has maintained a reduce rating with a target price of Rs 315. The brokerage said recent buyback at Rs 400 per share will provide near term support to the stock. Ambit has maintained a sell rating with a target price of Rs 270.

Edelweiss remains bullish on the stock with a buy rating and target price of Rs 467.

"Wipro’s new initiatives in over a decade—showcased at its analyst meet are exciting and reinforce our conviction on the company. The chairman’s statement of a ‘bolder, risk-taking, agile, obsessed with growth and think big’ Wipro marks a remarkable shift at the hitherto ‘introvert’ company," said Edelweiss.