Shares of Wipro gained 3.6 per cent to Rs 269.15 on Thursday after the company posted a 12.5 per cent increase in consolidated net profit for the June quarter.

However, brokerages cut price targets on the company by 2-10 per cent as topline disappointed. “Wipro’s Q1 disappointed particularly on topline where it reported a QoQ decline of 1.2 per cent (constant currency) vs expectation of flat revenue.

Q2 (July-September) growth guidance was also tepid at 0-2 per cent despite low Q1 base,” said Jefferies, while cutting target price by 8.2 per cent to Rs 225 and maintaining ‘underperform’ rating. Citigroup Global Markets, Morgan Stanley, Investec, Nomura and Prabhudas Lilladher cut target prices by 1.6-6 per cent. Morgan Stanley said the stock is likely to languish at a lower price-toearnings multiple. “Q1 had weaker IT services revenue and EBIT.

Revenue growth guidance of 0-2 per cent for Q2 is softer than expected and management is watchful of global macro softness,” said Morgan Stanley.

“With growth lower than peers, we see the stock languishing at a lower P/E multiple,” said Morgan Stanley. Nomura sees no signs of a turnaround visible. “We expect Wipro to continue to grow slower vs peers at around 4 per cent USD revenue CAGR over FY19-22 vs 7.5-8.0 per cent for INFO/TCS,” said Nomura.