Wipro Earnings: Weak Demand for Discretionary IT Services Projects Continues to Affect Financials

We are maintaining our INR 450 fair value estimate for narrow-moat Wipro after the firm reported financial results below our prior estimates as we still believe the firm's financials will bounce back next year. Similar to their peers, Tata Consultancy Services and Infosys, which reported Jan. 11, 2024, Wipro's financials continued to be weighed down by weak customer demand for IT services solutions amid macroeconomic uncertainty. Nonetheless, we remain confident that this state is temporary as bookings remain healthy, indicating overall demand for and recognition of the efficiencies that come with digital overhauls of a firm's IT landscape. With shares trading up after the earnings report, we now view Wipro's shares as fairly valued.