Views on Wipro 2QFY2016 Results: Angel Broking

Views of Ms. Sarabjit Kour Nangra (VP Research - IT, Angel Broking) on Wipro 2QFY2016 Results:

Wipro (CMP: INR 578 / TP: INR 719 /Upside: 24.4%)

"Wipro posted a 2.1% qoq growth to end the period at US$1832mn V/s US$1826mn expected. In Constant Currency terms (CC), the company posted a 3.0% qoq growth. In rupee terms, the company posted a 2.3% qoq growth of INR 12,514cr V/s INR 12,703cr expected. On the EBIDTA front, the margins came in at 21.7% V/s 21.3% expected. On EBIT front, the company posted an EBIT margins of 19.0% V/s 18.7% expected, a qoq expansion of 44bps. The IT services segment has EBIT margins of 20.7% V/s 21.0% in 1QFY2016. Thus, the Net Profit came in at INR 2,241cr V/s INR 2,223cr expected a growth of 2.4% qoq. On operating matrix, the company had net utilization levels of company came in at 77.2% V/s 79.4% in 1QFY2016 and the attrition rate was 16.8% V/s 16.4% in 1QFY2016.In client additions, the company has added one client in the US$50mn+ and three in US$10mn+.

On guidance front, the company has guided towards a sales of US$ 1,841-1,878mn, a qoq growth of 0.5-2.5%. According to the company the guidance is in line with fewer working days in 3QFY2016 and slow ramp-up of the clients. We currently have BUY rating on the stock."

Shares of WIPRO LTD. was last trading in BSE at Rs.577.9 as compared to the previous close of Rs. 571.95. The total number of shares traded during the day was 65081 in over 1889 trades.

The stock hit an intraday high of Rs. 579.25 and intraday low of 571.8. The net turnover during the day was Rs. 37471968.

Source : Equity Bulls

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