Wipro slips after rallying 4% as experts stay mixed post Q4 numbers

NEW DELHI: Shares of Wipro reversed gains and fell into negative terrain in Wednesday’s trade as experts remained largely mixed post the company’s fourth quarter results.

The stock was trading at Rs 492.70, down 0.37 per cent. The scrip soared 3.73 per cent to hit a high of Rs 513 level in trade earlier.

The company has guided for a weak Q1FY18 with revenue growth range of minus 2 per cent –nil.

Dipen Shah of Kotak Securities in a note said, “Wipro’s results were a mixed bag with revenues coming marginally higher and margins slightly lower v/s expectations. The guidance of (-)2% - 0% growth in 1QFY18 is a negative surprise and is due to cancellation of projects in the healthcare business as well as structural challenges in retail vertical. This, once again, reflects the need for better account management at Wipro”.

Edelweiss Securities said that Wipro’s numbers were marred by higher presence in struggling verticals like energy and higher exposure to India and Middle East.

“We believe that the positive commentary on BFSI and E&U along with recovery in US, resolution of internal issues and valuation comfort imply limited downside from current level. The stock trades at 12.5 times FY19E EPS. We maintain ‘BUY/SP’ with target price of Rs 554,” said he brokerage said.
UBS has maintained sell on the stock with a target of Rs 480 as the brokerage believes that a soft Q1 guidance has set the stage for another year of sluggishness. Persistently low expectations and multiples makes Wipro an unloved turnaround play, says CLSA in another note. This brokerage has cut the target for the stock to Rs 560 from Rs 600 earlier.