InvestorQ : How do you see the price movement of Wipro after the results on 13 Oct?
diksha shah made post

How do you see the price movement of Wipro after the results on 13 Oct?

shrinidhi Rajan answered.
2 years ago

Before we get to the price movement of Wipro, let us first look at the fundamentals of the results and the price movement ahead of the announcement. Along with the IT sector, Wipro has been among the top performers this quarter, beating the Nifty by a margin.

Now for the results! For the Sep-20 quarter, Wipro reported 3.4% yoy fall in net profit at Rs.2466 crore. On a sequential mom basis, the revenues were higher by 3.15%. But, revenues at Rs.15,115 crore were lower by 0.07% in Sep-20 quarter on yoy basis.

Even as cash generation improved, Wipro also saw an expansion in the margins for the quarter. That is amply evident from the sharp spike in cash flow from operations as a percentage of the net profits. Even operating margins expanded in the quarter.

The icing on the cake was that Wipro also announced a buyback of 23.75 crore shares subject to a maximum price of Rs.400 per share aggregating to Rs.9500 crore. This is slightly smaller in size compared to the buyback proposed in the last year.

The all important guidance is fairly strong for the third quarter. The guidance for the Dec-20 quarter has profiled sequential growth of 1.5- 3.5% in revenues, which is better than expected. Wipro has acquired Eximus Design, a leading engineering services company.

Going ahead, the price movement could be muted considering that the results were almost in line with expectations and most of the good news is already factored into prices. The big thrust for Wipro will be expand the operating margins to above the 20% mark.