Wipro shares: Should you buy, hold or sell stock? Here are target prices

Wipro Ltd managed to deliver better-than-expected December quarter results, with IT Services revenue and Ebitda beating the Street estimates. Analysts said Wipro's margin hit three-year high and the management managed to deliver on guidance for the second straight quarter. While the IT major's deal wins were soft, they were in line with estimates. A few analysts, however, believe the stock is fairly priced and upside is limited on the counter.

Nirmal Bang Institutional Equities said while Wipro delivered decent performance in a seasonally weak quarter, the caution pertains to sustainability of this growth as Energy, manufacturing and resources plus Technology verticals are weak with some early green shoots.

What it liked in Wipro's Q3 results was a large deal momentum (17 in Q3FY25), top account growth (up 8.5 per cent QoQ), second consecutive quarter on delivering the guidance, and three-year high margins.

"But Wipro now has: a) high reliance on Top client’s growth, b) weak deal conversion in Europe and c) leadership building in APMEA. To factor in these factors from 3QFY25 results, we have increased our estimates on EBIT for FY26/27 by 40/50bps and on EPS for FY26/27 by 1.1 per cent each. However, we reduced our Revenue estimates by 4.3 per cent each for FY26/27E to factor in Wipro specific headwinds. We reiterate HOLD on Wipro and maintain the valuation multiple of 21.3 times on Dec 2026 EPS of 14.4/share to get the target price of Rs 306," it said.

The IT firm last week posted a 24.48 per cent year-on-year (YoY) rise in its consolidated net profit for the December quarter at Rs 3,353.8 crore compared with Rs 2,694.2 crore in the year-ago period. Revenue from operations rose 0.51 per cent to Rs 22,318.8 crore in Q3 FY25 from Rs 22,205.1 crore in the corresponding period last fiscal. IT services operating margin for the quarter came in at 17.5 per cent.

MOFSL said the growth was particularly strong in the US BFSI and Healthcare verticals, driven by a gradual recovery in discretionary spending. The company’s focus on client mining and expanding its consulting business has further strengthened its deal pipeline, especially in the Americas, it said.

"However, challenges remain in certain verticals and geographies. Its 4Q guidance is muted (-1 per cent to 1 per cent in CC), reflecting regional softness, particularly in Europe and APMEA. Manufacturing and E&U verticals continue to face client-specific headwinds, with no immediate signs of recovery expected," it said while suuggesting a 'Neutral' and a target price of Rs 290 on the stock.

Nuvama Institutional Equities said Wipro’s results were in line with its recent upgrade thesis, which was based on its favourable portfolio mix and strong margin performance. It has upgraded its FY25 and FY26 earnings estimates by 2-5 per cent on higher margins. The brokerage maintained ‘Buy’ on the Wipro stock with unchanged target price of Rs 350.