Target Price: Rs700
* Wipro's IT services revenue grew 2.3% QoQ (3% CC) to USD2.64bn in Q3FY22, a tad below our estimates. IT services' EBITM declined 10bps QoQ to 17.6% as revenue momentum and operating efficiencies largely negated wage hikes and lower utilization.
* Wipro has guided for IT services revenue to be in the range of USD2,692-2,745mn in Q4, implying 2-4% CC QoQ growth. Management remains fairly confident of sustaining organic revenue growth momentum in coming quarters while sustaining EBITM at 17-17.5%.
* Wipro signed 11 large deals with a combined TCV of over USD600mn in Q3, while the total order intake was USD2.8bn. Management said the deal pipeline was robust and consisted of a good mix of small and large deals, providing good revenue visibility.
* We tweak our FY22E/FY23E/FY24E EPS by -0.6% to 0.2%, factoring in Q3 performance. We retain Hold with a TP of Rs700 at 25x Dec'23E EPS, considering rich valuations.