WIT
Wipro Limited
$1.81
Platform & Compounding FCF
70%
Two-stage FCF DCF
Strong
·
Conviction
Undervalued
Trading 55.0% below fair value
You pay
$1.81
Bear
$3.27
Fair
$4.02
Bull
$4.72
Bear
$3.27
+80.9%
5% stage 1 growth, 11% discount
Fair
$4.02
+122.1%
8% stage 1 growth, 11% discount
Bull
$4.72
+161.0%
11% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (8% base case)
Terminal Value % of EV
37%
Implied Market Multiple
10.6x
Market is pricing in (growth)
0.4%
vs 8.1% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $7.35 from 21 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $4.02 per share.
Warnings
Wall Street's average price target is $7.35 (from 21 analysts). Our estimate is 60% below the consensus -- consider that gap carefully.
Financial statements were converted from INR into USD using USDINR at 0.0104 USD per INR.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions