Wipro's June quarter earnings may have broadly matched expectations, but its weaker-than-expected guidance for the September quarter has prompted brokerages to turn more cautious on the IT major's near-term outlook. Following the results, Jefferies, Citi and Bank of America all reiterated their negative recommendations on the stock while cutting or maintaining lower target prices.
Jefferies maintained its 'Underperform' rating and cut its target price to Rs 150 from Rs 180, calling the June quarter "another soft print." The brokerage said Wipro's September-quarter revenue guidance of -1.5% to +0.5% in constant currency was the key disappointment, implying another quarter of weak organic growth.
Citi also maintained its 'Sell' rating with a Rs 150 target price, saying the company continues to underperform peers. The brokerage highlighted weak execution across major geographies and verticals, adding that market share gains have moderated and growth remains below industry trends.
Bank of America retained its 'Underperform' rating and lowered its target price to Rs 184 from Rs 210, saying the payoff from Wipro's investments will take longer to materialise.
Wipro reported a 4.3% sequential decline in net profit to Rs 3,352 crore, while revenue rose 1% quarter-on-quarter to Rs 24,479 crore. EBIT margin narrowed 160 basis points to 15.6%, and total bookings declined 2.4% sequentially to $3.37 billion, reinforcing concerns that demand recovery remains uneven.
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Brokerages on Wipro
Jefferies
- Maintain Underperform; Cut target price to Rs 150 from Rs 180.
- Another soft quarter, with guidance implying a delayed recovery.
- September 2026 quarter guidance was the key negative surprise.
- Wipro has struggled to deliver organic revenue growth for the past three years, and FY27 is unlikely to be any different.
- Cuts FY27-29 revenue and PAT estimates by 2-5% on a weaker growth outlook.
- Expects 5% EPS CAGR over FY27-29 and believes the risk-reward remains unattractive despite a 5% dividend yield.
Citi
- Maintain Sell; Cut target price to Rs 150 from Rs 160.
- Q1 performance was disappointing.
- Wipro continues to underperform peers.
- Performance remained weak across all major geographies and business verticals.
BofA
- Maintain Underperform; Cut target price to Rs 184 from Rs 210.
- Believes the turnaround will take longer than expected.
- Q1 was in line but soft, while Q2 guidance came in below expectations.
- Margin missed estimates as the company continued to prioritise investments.
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