Wipro, TechM shares gain ahead of Q1 results today: Earnings preview

Shares of IT giants Wipro Ltd and Tech Mahindra Ltd (TechM) were trading higher in Thursday's trade, ahead of their June quarter results. Wipro is seen reporting 12-14 per cent growth year-on-year (YoY) in sales but a flattish profit. TechM, on the other hand, is seen reporting 39-40 per cent growth YoY in profit on 15-16 per cent rise in sales. 

Analysts projected Wipro to report 0.2-1.3 per cent sequential decline in constant currency (CC), which would include about 0.7-1 per cent inorganic contribution from Mindsprint. This, analysts said, would be due to delayed ramp-ups, weakness in a large client, and softer US BFSI more than offset the acquisition benefit. 

TechM, on the other hand, is expected to see about 1 per cent QoQ CC revenue growth, led by continued ramp-up of large telecom deals and healthy BFSI momentum. 

At 10.10 am, Wipro shares were up 1.58 per cent at Rs 177.35 apiece on BSE. TechM rose 1.68 per cent to Rs 1523.90 per share.

Centrum Broking sees Wipro reporting 1.4 per cent YoY drop in net profit at Rs 3,285.30 crore despite 14.1 per cent YoY rise in net sales at Rs 25,257 crore. Margin is seen at 15.4  per cent. In the case of TechM, Centrum sees Q1 profit rising 39 per cent YoY to Rs 1,585 crore on 15.7 per cent YoY rise in sales at Rs 15,449 crore. Ebit margin for this IT major is seen at 14.2 per cent and deal wins at $1 billion. 

Centrum sees Wipro guiding for minus 1 per cent to 1 per cent QoQ of revenue growth in cc terms
for Q2FY27. 

YES Securities sees 0.2 per cent CC QoQ degrowth for Wipro in Q1 due to delayed revenue conversions. Margins is seen falling to 16.4 per cent, due to full quarter impact of wage hikes and continued investments in AI-native platforms. YES Securities sees 1 per cent CC QoQ growth for TechM, led by telecom deal ramp ups. Margins is seen stable supported by Project Fortius. 

Antique Stock Broking said it sees Wipro's deal total contract value to be around $1.8 billion against a four-quarter average of $2 billion. Given the macro situation, the Healthcare vertical continued to be impacted by policy-related headwinds; Consumer vertical also likely to remain weak with continued softness in BFSI, it said.

On TechM, this brokerage said sees margin improvement sequentially, driven by efforts focused on high-margin segments, currency tailwinds and benefits from project Fortius. Deal wins are expected at $950 million, in-line with the previous four-quarter average.