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Research
Wipro - 4QFY2017 Result Update - Angel Broking
Posted On : 2017-05-11 22:01:52( TIMEZONE : IST )
For 4QFY2017, Wipro's revenues in IT services came in at US$1,955mn (v/s US$1,937mn expected) v/s US$1,903mn in 3QFY2017, a 2.7% qoq growth, with a 1.7% qoq growth in Constant Currency (CC). In Rupee terms, revenues grew by 2.2% qoq to Rs. 13,988cr (v/s Rs. 13,561cr expected) v/s Rs. 13,688cr in 3QFY2017. On the operating front, EBIT margin came in at 14.3% (v/s 16.0% expected) v/s 16.4% in 3QFY2017, a dip of 160bps qoq. Consequently, PAT came in at Rs. 2,261cr (v/s Rs. 2,003cr expected) v/s Rs. 2,109cr in 3QFY2017, a growth of 7.2% qoq. It terms of guidance, the company has guided for 1QFY2018 sales of US$1,915-1,955. We maintain our BUY rating.
Quarterly highlights: IT services revenues came in at US$1,955mn (US$1,937mn expected) v/s US$1,903mn in 3QFY2017, a 2.7% qoq growth, with a 1.7% qoq growth in Constant Currency (CC). In terms of geography, the CC growth was USA (1.2% qoq), Europe (4.4% qoq). In terms of verticals, in CC terms, the growth was Manufacturing and Technology (4.7% qoq), Finance Solutions (3.2% qoq), Consumer Business Unit (2.6% qoq), Energy, Natural Resources & Utilities (1.9% qoq). On the operating front, EBIT margin came in at 14.3% (16.0% expected) v/s 16.4% in 3QFY2017, a dip 160bps qoq. Consequently, PAT came in at Rs. 2,261cr (Rs. 2,003cr expected) v/s Rs. 2,109cr in 3QFY2017, a growth of 7.2% qoq.
Outlook and valuation: The management has set a target of US$15bn of revenue and an EBIT margin of 23% by 2020. However, the near term guidance target appears to be disappointing. Nevertheless, we project a moderate top-line and net profit growth for FY2017-19E. However, given the valuations, we maintain our Buy rating on Wipro.
Shares of WIPRO LTD. was last trading in BSE at Rs.504.8 as compared to the previous close of Rs. 500.35. The total number of shares traded during the day was 94983 in over 1282 trades.
The stock hit an intraday high of Rs. 509 and intraday low of 500.55. The net turnover during the day was Rs. 47793876.
