Mcap advances by Rs4,756.93 crore
New Delhi: Shares of IT services company Wipro on Monday climbed 2 per cent as investors remain unfazed by the below market expectations guidance provided by the company.
The stock advanced 2.01 per cent to settle at Rs461.95 apiece on the BSE. During the day, it jumped 2.90 per cent to Rs466.
On the NSE, it climbed 2 per cent to Rs461.95 per share.
The company’s market capitalisation (mcap) climbed Rs4,756.93 crore to Rs2,41,377.31 crore.
Wipro on Friday reported a 7.8 per cent year-on-year decline in its consolidated net profit for the March quarter to about Rs2,834.6 crore, and cautioned that the macroeconomic environment remains “uncertain”.
The Bengaluru-headquartered company, which recently saw a change of guard with Srinivas Pallia taking over at the helm as the new Chief Executive Officer, has given IT Services revenue growth guidance in the (-)1.5 per cent to 0.5 per cent band for the June quarter on a constant currency basis.
While the numbers were in line with the analysts’ estimates, the guidance of the company was below industry expectations.
Pallia asserted that the immediate priority for the company is to “accelerate growth” as he spelt out clear focus areas for the IT services firm, which has been lagging peers on performance and operational metrics quarter-after-quarter.
For the Q4FY24, Wipro’s revenue from operations slipped 4.2 per cent year-on-year to Rs22,208.3 crore.
“We expect revenue from our IT Services business segment to be in the range of $2,617 million to $2,670 million. This translates to sequential guidance of (-)1.5 per cent to +0.5 per cent in constant currency terms,” the company said in its forecast for Q1 FY25.
Sanjeev Hota, Head of Research, Sharekhan by BNP Paribas, said while the revenue was in line with its estimates, the revenue growth guidance for Q1FY25 was lower-than-expectations and “reflects continuing pressure in the near term”.
“Headcount continued to decline for the sixth consecutive quarter…The quarterly numbers are a mixed bag, however, weaker-than-expected guidance continues to disappoint. Further the recent sudden change of CEO brings about an additional element of uncertainty in the near term before potential turnaround in the medium to longer term,” Hota said.
As per a report by Motilal Oswal Research, the performance of Wipro under the new CEO will be keenly monitored by investors before any meaningful re-rating.
