Reduce Wipro - Result Update - Emkay

Reco: REDUCE Wipro Ltd
CMP: Rs 414
Target Price: Rs 400

Decent improvement in metrics, but in the price

Inline performance with IT Svcs rev at US$ 1,505 mn (+2.2%QoQ). EBIT mgns at 20.8% (+80 bps QoQ) despite tailwinds from weak currency and pricing increases

Improvement on client metrics continues. Growth led by top clients (top 1/5 clients +8%/4% QoQ). HC addition remains strong at ~5k with attrition dropping to lowest levels in 8 qtrs

March'12 qtr revenue guidance at 1-3% QoQ encouraging. Management cites some pressures in client budgets but emphasizes strong focus on client management

FY12/13E EPS unchanged at Rs 23.2/26.7. Stock out performance in the recent past captures 'relatively decent' results. Wipro remains the least preferred Tier I stock for us.

Source : Equity Bulls

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