Wipro Q4 Results FY2023 Preview: What to Expect?

On April 27, Wipro will announce its March quarter financial results (Q4FY23). 

In Q3FY23, Wipro reported gross revenue of Rs. 232.3 billion and a net profit of Rs.30.65 billion. For the quarter that ended in March, Wipro is anticipated to report soft revenue growth in constant currency terms, primarily due to slower conversion and weakness in consulting.

Market Expectations from Wipro’s Quarterly Results:

Given the weakness in the consulting business and the worsening macro environment, ICICI Securities anticipates Wipro's revenue to decrease by 0.5% QoQ CC in Q4FY23, translating to 11.5 % YoY CC growth in FY23E, which is close to the lower end of the guided range of 11.5-12 % in FY23. For Wipro, it predicted a 100 bps cross-currency revenue tailwind. EBIT margin is anticipated to be largely flat (20-30bps) quarter over quarter. ICICI Securities anticipates Wipro to give a QoQ CC revenue growth guidance of -1% to 1% for Q1FY24.

According to Wipro's guidance, CC revenue growth will range from -0.6% to 1% QoQ. Accordingly, Jefferies predicts fourth-quarter revenue growth of 0.5% QoQ cc. Regarding deal momentum, Jefferies stated that larger cost takeout deals will keep deal bookings in the $600-700 million range even though they are expected to decline sequentially from a higher base last quarter.

Reliance Securities anticipates Wipro to report QoQ constant currency growth of 1.2%, near the top of the guided range.

According to Axis Securities, Strong deal wins are expected to help Wipro report double-digit revenue growth, with estimates reaching as high as 12.3%. Due to strong volume growth and strong executions, margins are also likely to slightly improve.

Wipro reportedly had a net cash balance of Rs. 221 billion, which could rise to Rs. 250 billion by March 2023, according to Kotak Institutional Equities. In accordance with its capital allocation strategy, the company has sufficient cash on hand to pursue a buyback.

The drivers of revenue decline are exposure to impacted verticals like high-tech and consumer, a slowdown in discretionary spending, and higher exposure to consulting. Kotak Institutional Equities predicts that the EBIT margin will decrease 10 basis points (bps) quarter over quarter to 16.2%.