Shares of Tech Mahindra and Wipro traded higher on Thursday ahead of their June-quarter earnings announcements, with investors positioning for another key day in the IT earnings season after mixed commentary from sector peers. Tech Mahindra rose as much as 1.75% intraday to ₹1,525, and was trading around 1.4% higher in morning trade, while Wipro climbed 1.73% intraday to ₹177.68 and was last up about 1.3%. According to NDTV Profit, the Street awaited both companies' quarterly scorecards later in the day, with Tech Mahindra expected to report a stronger quarter compared to Wipro's more muted performance.
Tech Mahindra is expected to report a stronger quarter with Bloomberg consensus estimates projecting a 17% sequential rise in consolidated net profit to ₹1,583 crore. Revenue is seen increasing to ₹15,458 crore from ₹15,076 crore in the March quarter, demonstrating robust growth momentum. Operating performance is also expected to improve, with EBIT projected to rise 5% quarter-on-quarter to ₹2,189 crore, lifting the EBIT margin to 14.16% from 13.82% in the previous quarter. The brokerage firm anticipates revenue growth of 2.4% QoQ, driven by the rampup of a large telecom deal and resilient demand from the BFSI and Manufacturing verticals, with EBIT margins expected to remain broadly flat QoQ as higher investments are likely to be offset by cost optimisation initiatives and currency tailwinds.
Wipro is expected to report a more muted quarter with Bloomberg estimates suggesting revenue could rise about 2% sequentially to ₹24,730 crore, helped by acquisitions and currency movements, even as its core IT services business is likely to remain weak on a sequential basis. Net profit is estimated to grow about 2% from a year earlier, according to the average estimates of six brokerages. EBIT is estimated to decline 1% quarter-on-quarter to ₹4,113 crore, while the EBIT margin is seen narrowing to 16.63% from 17.18%, reflecting pressure on profitability. ICICI Securities expects Wipro's IT services revenue to decline 0.4% quarter-on-quarter in constant currency terms and 1.3% QoQ in US dollar organic terms. The growth is likely to be supported by the ramp-up of the $1 billion Olam deal, which spans eight years and is expected to aid the retail vertical, a 1.5-month contribution of around 0.8% from the consolidation of Mindsprint and Alpha Net Consulting, and healthy revenue growth from the Harman acquisition. Wipro's board may also consider an interim dividend for shareholders during today's announcement.
Several prominent companies are set to announce their April-June quarter earnings today, including Wipro, Tech Mahindra, Jio Financial Services, BHEL, Polycab India, ITC Hotels, CEAT, South Indian Bank, WeWork India Management, 360 ONE WAM, Borosil Renewables Ltd., Newgen Software Technologies, Alok Industries, Sterling and Wilson Renewable Energy, DB Corp, Heritage Foods, GNA Axles, Hathway Cable and Datacom, NELCO, 5paisa Capital, PNB Gilts, Menon Bearings, Chembond Chemicals, Integra Engineering India, Onward Technologies, Muthoot Capital Services, Mahindra EPC Irrigation, Alacrity Securities, TRF, Atishay, Telge Projects, Avience Biomedicals, Sampark India Logistics, Vigor Plast India, Machhar Industries, Ontic Finserve, Jayshree Chemicals, and Deccan Polypacks. According to reports from Business Standard, these earnings announcements will provide crucial insights into corporate performance during the quarter.
The Indian stock market experienced positive momentum, with BSE Sensex up 235 points (0.30%) to 77,419 at around 9:20 am on Thursday, as reported by Business Standard. Most Asian markets traded lower during the morning session, tracking an overnight decline in global chip stocks and heightened geopolitical tensions in West Asia. Japan's Nikkei 225 and South Korea's Kospi were down 3.24% and 7.3% respectively. The gains were led by favourable global cues and selective buying in key sectors. Gift Nifty futures were trading 22.50 points higher at 24,064 as of 7.40 am, indicating positive opening sentiment for today's session. Several companies including Angel One, HDB Financial, and HDFC AMC also reported strong quarterly results, with Angel One showing significant year-on-year profit growth. According to ETMarkets, analysts note that the tug of war between bulls and bears continues to keep the benchmark index range-bound, while rotational buying across sectors and the resilience of broader markets offer ample stock-specific trading opportunities.
