Wipro shares settled 1.8% higher at ₹174.05 in the previous trading session, touching a high of ₹174.69 following the September quarter results announcement. However, brokerages remain cautious on the stock with mixed recommendations. Citi maintained its SELL rating with a target price of ₹145, up from ₹140, describing the Q2 performance as slightly ahead of muted expectations. Jefferies retained its UNDERPERFORM rating with a target of ₹155, up from ₹150, flagging weak forward indicators despite sequential revenue growth. The latest development sees Prabhudas Lilladher recommending a HOLD rating with a target price of ₹166, up from their earlier target of ₹154, citing better-than-expected Q2 performance. Systematix maintains a HOLD rating with a revised target price of ₹175, rolling forward their valuation to 12 times September 2028 estimated earnings per share, noting that Wipro's turnaround remains constrained by weaker pockets within its portfolio, subdued demand and geopolitical headwinds. ICICI Securities has now reduced its rating on Wipro with a target price of ₹154, maintaining a REDUCE rating in their research report dated October 16, 2026, citing muted revenue growth outlook and declining deal bookings. The brokerage rolls forward by two quarters to Q3FY28-Q2FY29E EPS of ₹14 with an unchanged target multiple of 11x to arrive at their target price.
Wipro reported a 4.50% year-on-year decline in consolidated net profit to ₹3,200.6 crore for Q2 FY27, down from ₹3,352 crore in the corresponding quarter last year, according to the latest exchange filing. Revenue from operations rose 1.1% to ₹24,752.7 crore compared to ₹24,479 crore in Q2 FY26, marginally ahead of estimates of ₹24,710 crore. EBIT increased 4.1% to ₹3,986 crore from ₹3,830 crore, though EBIT margin stood at 16.1% versus the estimate of 16.26%. Revenue from the company's IT services business stood at $2,611.5 million, unchanged sequentially and up 0.3% year-on-year. Operating margin for the IT services segment improved 50 basis points to 16.5% in Q2 FY27, expanding despite continued investments in the business and workforce. At current market price, Wipro trades at 13x/12x/12x FY27E/FY28E/FY29E EPS, a 19% discount to large peers' average one-year forward P/E.
Wipro's IT services revenue stood at $2,611.5 million during the September quarter, declining 0.1% sequentially from $2,614.5 million in Q1, showing resilience despite challenging market conditions. IT services revenue specifically increased 0.3% year-on-year to ₹24,667 crore, demonstrating continued momentum. In rupee terms, revenue growth stood at 1.12% to ₹24,752.7 crore, compared to ₹24,478.6 crore in the previous quarter, which was lower than the poll figure of ₹24,733 crore. In constant currency terms, revenue remained flat quarter-on-quarter but increased by a modest 0.6% year-on-year, indicating that the company is successfully navigating challenging market conditions. Operating margin for the IT services segment stood at 16.5% in Q2FY27, expanding 0.5 percentage points sequentially despite continued investments in the business and workforce.
Wipro's total contract bookings fell to $2.6 billion in the September quarter from $4.7 billion a year earlier, marking a sharp decline and representing a nearly four-year low. Bookings also fell 22.9% quarter-on-quarter in constant currency terms, indicating significant weakness in new business acquisition. Large deal bookings came in at $700 million, down 58.6% quarter-on-quarter in constant currency terms, highlighting the company's challenges in securing major client engagements. H1FY27 bookings were down 38% YoY, as reported by ICICI Securities, indicating sustained pressure in new business acquisition. Contract signings slipped to Q3 FY27, with Systematix noting that total bookings declined 23% QoQ to $2.6 billion, lagging peers. Jefferies noted the 45% year-on-year decline in deal wins as a sign of weaker growth prospects, while Citi flagged weak forward indicators despite sequential improvement in revenue. However, management clarified that two deals closure were delayed and are expected to close in Q3, with these deals expected to support revenue upside in Q4FY27. The company faces challenges related to AI disruption in India's $315 billion IT industry, prompting companies to revamp their business models and offer deeper discounts to win deals.
For the October-December quarter, Wipro expects IT services revenue in the range of $2,571-2,625 million, translating to sequential revenue guidance of -1.5% to +0.5% in constant currency terms, broadly in line with expectations. Revenue guidance of -1.5% to +0.5% QoQ CC for Q3 remains muted, reflecting healthcare pressures, client-specific challenges and seasonality. CEO Srinivas Pallia expressed optimism about Q3 bookings, noting that a couple of deals were awarded but not signed during the September quarter, with these deals expected to flow into the December quarter. Pallia added that he was 'very, very bullish' about Q3 bookings, though seasonal furloughs would weigh on third-quarter performance. Management expects better revenue growth recovery in Q4FY27, as deals that slipped from Q2 to Q3 are likely to ramp up and start contributing to revenue in the quarter. ICICI Securities notes that consistent positive sequential revenue growth momentum needs to be broad-based across verticals and markets and requires healthy growth in TCV, both of which are yet to materialise. While deal conversions and ramp-ups could support a Q4 recovery, the absence of a clear organic growth catalyst underpins Systematix's FY27E constant currency revenue forecast of -0.5%. ICICI Securities has raised its FY27E/FY28E/FY29E earnings estimates by 0.2–0.8%, factoring in recent performance, expected positive growth in Q4 FY27, gradual margin recovery and revised USD/INR assumptions, though the expected earnings growth alongside a 5% dividend yield leaves an unattractive risk-reward profile.
