Wipro (BSE:507685) - Share price, News & Analysis

Q: What is the Fair Price of 507685 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

507685 (₹438.4) is trading below our estimate of [[fair value]] (₹585.76)

507685 fundamental analysis
Snowflake Score
Valuation	5/6
Future Growth	1/6
Past Performance	2/6
Financial Health	6/6
Dividends	4/6

507685 Stock Overview

Wipro Limited operates as information technology (IT), consulting, and business process services company worldwide.

Rewards

Trading at 25.2% below our estimate of its fair value

Earnings are forecast to grow 11.51% per year

Risk Analysis

Unstable dividend track record

Wipro Competitors

HCL Technologies

NSEI:HCLTECH

₹2.6t

Tech Mahindra

NSEI:TECHM

₹946.5b

Infosys

NSEI:INFY

₹6.8t

Larsen & Toubro Infotech

NSEI:LTI

₹876.9b

Price History & Performance

Summary of all time highs, changes and price drops for Wipro
Historical stock prices
Current Share Price	₹438.40
52 Week High	₹739.80
52 Week Low	₹391.00
Beta	0.77
1 Month Change	7.18%
3 Month Change	-6.44%
1 Year Change	-27.64%
3 Year Change	74.56%
5 Year Change	102.40%
Change since IPO	27,734.99%

Shareholder Returns

	507685	IN IT	IN Market
7D	0.7%	1.4%	1.1%
1Y	-27.6%	-5.6%	8.5%

Return vs Industry: 507685 underperformed the Indian IT industry which returned -6.1% over the past year.

Return vs Market: 507685 underperformed the Indian Market which returned 8.7% over the past year.

Price Volatility

Is 507685's price volatile compared to industry and market?
507685 volatility
507685 Average Weekly Movement	4.3%
IT Industry Average Movement	7.0%
Market Average Movement	6.4%
10% most volatile stocks in IN Market	9.1%
10% least volatile stocks in IN Market	4.2%

Stable Share Price: 507685 is less volatile than 75% of Indian stocks over the past 3 months, typically moving +/- 4% a week.

Volatility Over Time: 507685's weekly volatility (4%) has been stable over the past year.

About the Company

Founded	Employees	CEO	Website
1945	258,574	Thierry Delaporte	https://www.wipro.com

Wipro Limited operates as information technology (IT), consulting, and business process services company worldwide. It operates through three segments: IT Services, IT Products, and India State Run Enterprise Services (ISRE). The IT Services segment offers IT and IT-enabled services, including digital strategy advisory, customer-centric design, technology and IT consulting, custom application design, development, re-engineering and maintenance, systems integration, package implementation, cloud and infrastructure, business process, cloud, mobility and analytics, research and development, and hardware and software design services to enterprises.

Wipro Fundamentals Summary

How do Wipro's earnings and revenue compare to its market cap?
507685 fundamental statistics
Market Cap	₹2.40t
Earnings (TTM)	₹115.51b
Revenue (TTM)	₹823.70b

20.8x

P/E Ratio

2.9x

P/S Ratio

Is 507685 overvalued?

See Fair Value and valuation analysis

Earnings & Revenue

Key profitability statistics from the latest earnings report
507685 income statement (TTM)
Revenue	₹823.70b
Cost of Revenue	₹583.91b
Gross Profit	₹239.79b
Other Expenses	₹124.29b
Earnings	₹115.51b

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)	21.12
Gross Margin	29.11%
Net Profit Margin	14.02%
Debt/Equity Ratio	25.3%

How did 507685 perform over the long term?

See historical performance and comparison

Dividends

1.4%

Current Dividend Yield

28%

Payout Ratio

We’ve recently updated our valuation analysis.

Valuation

Is 507685 undervalued compared to its fair value, analyst forecasts and its price relative to the market?

Valuation Score

5/6

Valuation Score 5/6

Price-To-Earnings vs Peers
Price-To-Earnings vs Industry
Price-To-Earnings vs Fair Ratio
Below Fair Value
Significantly Below Fair Value
Analyst Forecast

Key Valuation Metric

Which metric is best to use when looking at relative valuation for 507685?

Other financial metrics that can be useful for relative valuation.

The above table shows the n/a ratio for 507685. This is calculated by dividing 507685's market cap by their current preferred multiple.
What is 507685's n/a Ratio?
n/a Ratio	0x
n/a	n/a
Market Cap	₹2.40t

507685 key valuation metrics and ratios. From Price to Earnings, Price to Sales and Price to Book to Price to Earnings Growth Ratio, Enterprise Value and EBITDA.
Key Statistics
Enterprise Value/Revenue	2.8x
Enterprise Value/EBITDA	14.6x
PEG Ratio	1.8x

Price to Earnings Ratio vs Peers

How does 507685's PE Ratio compare to its peers?

507685 PE Ratio vs Peers

The above table shows the PE ratio for 507685 vs its peers. Here we also display the market cap and forecasted growth for additional consideration.
Company	PE	Estimated Growth	Market Cap
Peer Average	25.3x
HCLTECH HCL Technologies	18.4x	10.8%	₹2.6t
TECHM Tech Mahindra	17.7x	12.2%	₹946.5b
INFY Infosys	29.2x	13.2%	₹6.8t
LTI Larsen & Toubro Infotech	36x	12.4%	₹876.9b
507685 Wipro	20.8x	11.5%	₹2.4t

Price-To-Earnings vs Peers: 507685 is good value based on its Price-To-Earnings Ratio (20.8x) compared to the peer average (25.3x).

Price to Earnings Ratio vs Industry

How does 507685's PE Ratio compare vs other companies in the IN IT Industry?

Price-To-Earnings vs Industry: 507685 is good value based on its Price-To-Earnings Ratio (20.8x) compared to the Indian IT industry average (28x)

Price to Earnings Ratio vs Fair Ratio

What is 507685's PE Ratio compared to its Fair PE Ratio? This is the expected PE Ratio taking into account the company's forecast earnings growth, profit margins and other risk factors.

507685 PE Ratio vs Fair Ratio.
Fair Ratio
Current PE Ratio	20.8x
Fair PE Ratio	35.5x

Price-To-Earnings vs Fair Ratio: 507685 is good value based on its Price-To-Earnings Ratio (20.8x) compared to the estimated Fair Price-To-Earnings Ratio (35.5x).

Share Price vs Fair Value

What is the Fair Price of 507685 when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

Below Fair Value: 507685 (₹438.4) is trading below our estimate of fair value (₹585.76)

Significantly Below Fair Value: 507685 is trading below fair value by more than 20%.

Analyst Price Targets

What is the analyst 12-month forecast and do we have any statistical confidence in the consensus price target?

Analyst Forecast: Target price is less than 20% higher than the current share price.

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Future Growth

How is Wipro forecast to perform in the next 1 to 3 years based on estimates from 41 analysts?

Future Growth Score

1/6

Future Growth Score 1/6

Earnings vs Savings Rate
Earnings vs Market
High Growth Earnings
Revenue vs Market
High Growth Revenue
Future ROE

11.5%

Forecasted annual earnings growth

Earnings and Revenue Growth Forecasts

Analyst Future Growth Forecasts

Earnings vs Savings Rate: 507685's forecast earnings growth (11.5% per year) is above the savings rate (6.8%).

Earnings vs Market: 507685's earnings (11.5% per year) are forecast to grow slower than the Indian market (18.8% per year).

High Growth Earnings: 507685's earnings are forecast to grow, but not significantly.

Revenue vs Market: 507685's revenue (8.9% per year) is forecast to grow slower than the Indian market (10.8% per year).

High Growth Revenue: 507685's revenue (8.9% per year) is forecast to grow slower than 20% per year.

Earnings per Share Growth Forecasts

Future Return on Equity

Future ROE: 507685's Return on Equity is forecast to be low in 3 years time (17.9%).

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Past Performance

How has Wipro performed over the past 5 years?

Past Performance Score

2/6

Past Performance Score 2/6

Quality Earnings
Growing Profit Margin
Earnings Trend
Accelerating Growth
Earnings vs Industry
High ROE

8.9%

Historical annual earnings growth

Earnings and Revenue History

Quality Earnings: 507685 has high quality earnings.

Growing Profit Margin: 507685's current net profit margins (14%) are lower than last year (17.8%).

Past Earnings Growth Analysis

Earnings Trend: 507685's earnings have grown by 8.9% per year over the past 5 years.

Accelerating Growth: 507685's has had negative earnings growth over the past year, so it can't be compared to its 5-year average.

Earnings vs Industry: 507685 had negative earnings growth (-0.7%) over the past year, making it difficult to compare to the IT industry average (26.7%).

Return on Equity

High ROE: 507685's Return on Equity (16.8%) is considered low.

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Financial Health

How is Wipro's financial position?

Financial Health Score

6/6

Financial Health Score 6/6

Short Term Liabilities
Long Term Liabilities
Debt Level
Reducing Debt
Debt Coverage
Interest Coverage

Financial Position Analysis

Short Term Liabilities: 507685's short term assets (₹585.1B) exceed its short term liabilities (₹300.5B).

Long Term Liabilities: 507685's short term assets (₹585.1B) exceed its long term liabilities (₹115.1B).

Debt to Equity History and Analysis

Debt Level: 507685 has more cash than its total debt.

Reducing Debt: 507685's debt to equity ratio has reduced from 25.6% to 25.3% over the past 5 years.

Debt Coverage: 507685's debt is well covered by operating cash flow (45.4%).

Interest Coverage: 507685 earns more interest than it pays, so coverage of interest payments is not a concern.

Balance Sheet

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Dividend

What is Wipro current dividend yield, its reliability and sustainability?

Dividend Score

4/6

Dividend Score 4/6

Notable Dividend
High Dividend
Stable Dividend
Growing Dividend
Earnings Coverage
Cash Flow Coverage

1.37%

Current Dividend Yield

Dividend Yield vs Market

Notable Dividend: 507685's dividend (1.37%) is higher than the bottom 25% of dividend payers in the Indian market (0.39%).

High Dividend: 507685's dividend (1.37%) is low compared to the top 25% of dividend payers in the Indian market (1.72%).

Stability and Growth of Payments

Stable Dividend: 507685's dividend payments have been volatile in the past 10 years.

Growing Dividend: 507685's dividend payments have increased over the past 10 years.

Earnings Payout to Shareholders

Earnings Coverage: With its reasonably low payout ratio (28.4%), 507685's dividend payments are well covered by earnings.

Cash Payout to Shareholders

Cash Flow Coverage: With its reasonable cash payout ratio (55.9%), 507685's dividend payments are covered by cash flows.

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Management

How experienced are the management team and are they aligned to shareholders interests?

5.5yrs

Average management tenure

CEO

Thierry Delaporte (55 yo)

2.08yrs

Tenure

₹798,090,000

Compensation

Mr. Thierry Delaporte serves as Independent Director at Compagnie de Saint-Gobain S.A. since 2022. He serves as Member of Executive Board at Wipro Limited since 2021 and serves as its MD, CEO & Director si...

CEO Compensation Analysis

Compensation vs Market: Thierry's total compensation ($USD10.10M) is above average for companies of similar size in the Indian market ($USD1.34M).

Compensation vs Earnings: Thierry's compensation has been consistent with company performance over the past year.

Leadership Team

Experienced Management: 507685's management team is seasoned and experienced (5.5 years average tenure).

Board Members

Experienced Board: 507685's board of directors are considered experienced (6.3 years average tenure).

Ownership

Who are the major shareholders and have insiders been buying or selling?

Insider Trading Volume

Insider Buying: 507685 insiders have only sold shares in the past 3 months.

Recent Insider Transactions

Ownership Breakdown

Dilution of Shares: Shareholders have not been meaningfully diluted in the past year.

Data	Last Updated (UTC time)
Company Analysis	2022/08/11 00:00
End of Day Share Price	2022/08/11 00:00
Earnings	2022/06/30
Annual Earnings	2022/03/31