Wipro Ltd (Q4 FY07) - "Strong performance"

Dear Sir/Madam,

Wipro delivered strong performance in the quarter led by good growth across all segments. Revenues grew by 8.8% with BPO services and Wipro Infotech segment growing faster. Operating margin decline was lower than anticipated at 40 bps qoq with significant improvement in profitability of BPO, acquisitions and Wipro Infotech. Aided by higher other income and tax write back of ~Rs700mn, net profit grew higher at 11.8%. Company has guided for a muted 2.9% qoq revenue growth in Global IT segment for Q1 FY08.

Outlook

We are revising downwards our FY08 EPS estimate by 2% to Rs24.9. However, we still maintain ‘BUY’ rating on the company as our one-year target price of Rs721 (based on 29x FY08E EPS) implies about 25% appreciation from current levels.

Click below for the detailed Result Update:
http://www.indiainfoline.com/content/rep/Result_Analysis/2007/4/2342007/wipro_0307.pdf

Warm Regards,

Rajiv Mehta
India Infoline Ltd

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