Wipro Ltd (Q3 FY08): "Riding on high expectations" - SELL

Wipro Ltd (Q3 FY08): "Riding on high expectations"


Target price Rs352,  Upside (22.6)%


ä        Revenue growth in organic IT services and BPO was above expectations. It was well supplemented by strong growth in Wirpo Infotech and Consumer Care segments.

ä        Integration of Infocrossing impacts EBIDTA margin, which declined 70 bps qoq. Net profit growth was further dampened by higher depreciation and interest.

ä               Company guides for 4.9% qoq revenue growth and 40-60 bps EBIDTA margin decline in Q4 FY08. This implies a bad Q4 FY08 with flat to negative qoq profit growth. 

ä       Remain negative on Wipro with a target price of Rs352 implying 23% downside. Key worries are margin management and steep performance expectations in challenging business environment.


Click below for Result Update on Great Offshore Ltd (Q2 FY08)




Warm Regards,


India Infoline Research Team


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