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Mixed growth for Revenue: Wipro reported de-growth of revenue by 0.3% QoQ and 6.6% YoY in constant currency for Q4FY24. Revenue in rupee stood at Rs 22,208cr which was flat sequentially while it declined by 4.2% YoY. Besides, its dollar revenue grew marginally by 0.3% QoQ but de-grew by 6.1% YoY to USD 2,665mn. Further, the company’s IT service revenue came in at USD 2,657.4cr flat QoQ but down by 6.4% YoY. Amongst geographies, mixed growth was seen wherein America 2 and Europe region witnessed positive growth as compared to last quarter while American 1 and other Asian & Middle-East countries saw a muted growth. Amongst segments, BFSI, health & energy drove growth as compared sequentially while technology, communications, manufacturing witnessed de-growth.

Improving EBIT margin: EBIT for Q4FY24 grew by 9% QoQ to Rs 3,560cr while it declined by 3.1% YoY. Its EBIT margin saw a healthy improvement of 132bps QoQ and 19bps YoY to 16%. Its IT service EBIT margin came in at 16.4%, an improvement of 40bps QoQ & 10bps YoY. For FY24, its EBIT de-grew by 2.1% YoY with margins at 14.9%. Going ahead, the management plan is to scale it further with improving efficiency, utilization, skilling employees and deployment of more products into newer technology.

Attrition was flat: Attrition for Q4FY24 continued to remain flat as compared to last quarter at 14.2% while it moderated from Q4FY23 by 500bps from 19.2%. For FY24, attrition came in at 14.2% an ease of 520bps from 19.4% YoY.

Healthy Order book: Order book for the quarter stood at USD 3.6bn and amongst it USD 1.2bn were the large deals which increased by 33.3% (USD 0.9bn) as compared to last quarter. For Q4FY24, TCV stood at USD 14.9bn, down by 5.5% in CC terms while amongst them large deals were USD 4.6bn which grew by 17.4% in CC terms.

Cautious management guidance: Management believed FY24 was a challenging year and in the near terms concerns are yet not over. However, from a medium to long term perspective, they are optimistic on the back of opportunities such as technological shift, availability of manpower, strong capability of the company along with its products as well as continuous investment towards it would aid in driving growth. For the next quarter, Q1FY25 they expect revenue from the IT Services business segment to be in the range of USD 2,617mn to USD 2,670mn which would translate to sequential guidance of -1.5% to +0.5% in CC terms.

Outlook & Valuation: Wipro reported mixed numbers for Q4FY24. We believe Wipro has strong capabilities, a decent client base and focus of management to build a healthy future. However, they would still need 1-2 quarters for noticeable revival. Further, with a management plan of focus on 5 areas along with training employees, healthy demand and improving utilization would drive growth ahead. On the financial front, we expect revenue/EBIT to grow by 6.2%/9.2% CAGR over FY24-26E and we maintain our Accumulate rating with a target price of Rs 513.

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