Wipro Q2FY23 Results Preview: Company’s profit may grow in double-digit, margins likely to improve – Check expectations

Wipro Result Preview: IT Services company Wipro Limited is expected to report healthy second-quarter earnings for the financial year 2022-23 (Q2FY23) on Wednesday, October 12, 2022, according to Zee Business senior research analyst Varun Dubey’s preview.

Wipro may report over 15 per cent quarter-on-quarter (QoQ) growth in Q2FY23 profit to Rs 2,950 crore (estimate) against Rs 2,464 crore in the first quarter of the current financial year.

While the company’s revenue in rupee terms may grow by 5.2 per cent to Rs 22,650 crore (estimate) in the July-September quarter of FY23 as against Rs 21,529 crore in the previous quarter. While in dollar terms, the revenue may surge by 2.6 per cent to $ 280.6 crore (estimate) versus $ 273.55 crore QoQ.

The senior research analyst said the IT services margins may increase substantially, aiding the overall company’s margins during the quarter. Wipro’s Q2FY23 margins may see a rise of 15.3 per cent sequentially from 15 per cent in Q1FY23.

In constant currency terms, the revenue growth will be in line with Wipro’s guidance of 3-5 per cent, according to Dubey it would come around 4 per cent in the July-September quarter.

It is expected that the company may come out with the guidance of 1-3 per cent while announcing the September-end quarter results on Wednesday, Dubey also said.

On the technical front, market analyst Himanshu Gupta, who is VP at Globe Capital Market, said the stock has been taking support at Rs 380-385 apiece levels, however, it doesn’t show any sign of sharp recovery all-in-all. He believes the stock may touch levels of Rs 425-428 levels, going forward.

In line with Zee Business expectations, Street expects IT services CC revenue growth may come around 4 per cent on large deal ramp-ups, while margins are expected to expand modestly with headwinds like salary hikes and promotions, offset by growth, utilization improvement, and efficiencies.

Key things to watch out for in the Q2FY23 earnings announcement would be – Outlook for Q3FY23E; commentary on the large deal wins; commentary on client mining; Attrition trends; M&A and capital allocation; outlook on the European region and any other macro challenges.