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Wipro has entered into an agreement to acquire the Digital Transformation Solutions (DTS) business unit of HARMAN, a Samsung company, for a cash consideration of USD375mn (~1.2x P/S on CY24 basis). The acquisition expands Wipro’s ER&D service offerings and capabilities by enhancing its AIpowered digital engineering and device engineering—including design-tomanufacturing—across the technology, industrial, aerospace, healthcare, and consumer industries. As part of the acquisition, Wipro will enter into a multiyear strategic agreement with HARMAN and Samsung, further deepening the relationship and creating new avenues for joint growth and transformation. We have not yet factored the acquisition (likely to contribute ~3% to Wipro’s revenue with margin dilution of 50-60bps in first year of consolidation) into our earnings estimates, pending deal closure. We retain REDUCE on Wipro with TP of Rs280 at 20x Jun-27E EPS..

Deal details and structure Wipro, via its subsidiaries, has signed a definitive agreement with Harman International Industries, Inc for the acquisition of 100% shareholding in Harman Connected Services Inc (DTS), its subsidiaries, and certain other assets, for a total cash consideration of up to USD375mn (including earn-outs). The deal is valued at ~1.2x P/S on CY24 basis. Upon deal completion, DTS will be integrated into Wipro’s Engineering global business line. As part of the agreement, over 5,600 DTS employees, including key leadership, across regions will transition to Wipro upon completion of the transaction. The acquisition is subject to regulatory approvals and is expected to close by end-CY25.

Acquisition strengthens ER&D capabilities in high-growth sectors The acquisition expands Wipro’s ER&D service offerings and capabilities by enhancing its AI-powered digital engineering and device engineering—including design-tomanufacturing—across various industries. Wipro and DTS will enable clients to seamlessly connect virtual and physical worlds, embed AI across the full spectrum of engineering, and unlock scalable innovation. It strengthens Wipro’s software-defined, platform-centric approach, and empowers it to deliver larger, more complex transformation programs across high-growth sectors, including Hi-Tech, Consumer, Industrial, Healthcare, and Aerospace.

HARMAN’s DTS Business Unit – A brief profile DTS, headquartered in Connecticut, USA, is a global provider of ER&D services (comprising embedded software, digital engineering, design thinking, device engineering etc; ~80% of revenue) and IT services (cloud and infra services, data analytics and AI, enterprise automation and customer experience; ~20% of revenue) to the Industrial, Consumer, Hi-Tech (Communication and Software), and Healthcare and Lifesciences sectors. It has more than 5,600 employees in 14 countries (incl India, US, South Korea, UK, Poland, Germany). It reported revenue of USD315.0/308.2/314.5mn in CY22/23/24. For CY24, services contributed ~85% of revenue, while the rest came from the product.

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