Hold Wipro, target price Rs 410: ICICI Securities

ICICI Securities has hold call on Wipro with a target price of Rs 410. The current market price of Wipro is Rs 405.1.

Wipro, incorporated in the year 1945, is a Large Cap company (having a market cap of Rs 222323.62 Crore) operating in IT Software sector.

Wipro key Products/Revenue Segments include Software Services, Networking, Storage equipment, Servers, Software Licenses for the year ending 31-Mar-2022.


Financials
For the quarter ended 31-12-2022, the company has reported a Consolidated Total Income of Rs 23867.30 Crore, up 3.55 % from last quarter Total Income of Rs 23049.40 Crore and up 14.79 % from last year same quarter Total Income of Rs 20791.50 Crore. Company has reported net profit after tax of Rs 3062.40 Crore in latest quarter.

The company’s top management includes Mr.Rishad A Premji, Mr.Azim H Premji, Mr.Thierry Delaporte, Ms.Tulsi Naidu, Mr.Deepak M Satwalekar, Dr.Patrick J Ennis, Mr.Patrick Dupuis, Mr.Ireena Vittal. Company has Deloitte Haskins & Sells LLP as its auditors. As on 31-12-2022, the company has a total of 549 Crore shares outstanding.

Investment Rationale
Wipro’s EBIT margins may improve modestly from 15.1% in FY23E to 16.4% byFY26E on the back of levers like: 1) pricing, 2) lower attrition leading to lower employee cost as a percentage of sales, 3) pyramid optimisation, and 4) shift to fixed price projects where the company can retain certain savings through automation.

Promoter/FII Holdings
Promoters held 72.94 per cent stake in the company as of 31-Dec-2022, while FIIs owned 6.3 per cent, DIIs 7.8 per cent.