Morgan Stanley has retained its ‘Underweight’ rating on Wipro with a target price of ₹265 per share, citing weak revenue performance and subdued guidance for the first quarter of FY26. The stock is currently trading at ₹247.60, indicating limited upside from current levels.
In its review of Wipro’s Q4 FY25 performance, the brokerage noted that IT services revenue declined 0.8% quarter-on-quarter, falling short of expectations. Operating margins came in at 17.1%, slightly below the estimate of 17.5%.
The company’s Q1 FY26 revenue growth guidance of -3.5% to -1.5% QoQ in constant currency terms also fell below Street expectations of -2% to 0%, reinforcing concerns around client spending delays amid macro uncertainty.
Total Contract Value (TCV) stood at $4 billion, in line with estimates, and was led by a higher contribution from large deals. TCV grew 83.5% year-on-year, a positive sign, though growth was concentrated in the energy vertical, with other sectors witnessing sequential declines.
Geographically, the APMEA (Asia Pacific, Middle East, and Africa) region led growth during the quarter.
Morgan Stanley believes Wipro continues to face structural challenges across its verticals and remains cautious given the muted revenue trajectory and client behavior trends.
Disclaimer: This article is based on Morgan Stanley’s research note and does not reflect the views of the author or publication. Investors should consult their financial advisor before making investment decisions.
