WIT
Wipro Limited
$1.93
Platform & Compounding FCF
70%
Two-stage FCF DCF
Moderate
·
Conviction
Undervalued
Trading 35.4% below fair value
You pay
$1.93
Bear
$2.49
Fair
$2.99
Bull
$3.44
Bear
$2.49
+28.9%
4% stage 1 growth, 11% discount
Fair
$2.99
+54.8%
7% stage 1 growth, 11% discount
Bull
$3.44
+78.5%
9% stage 1 growth, 11% discount
Adjust Assumptions
7.2%
11.0%
3.0%
Key Value Driver
FCF growth rate (7% base case)
Terminal Value % of EV
36%
Implied Market Multiple
10.5x
Market is pricing in (growth)
0.1%
vs 7.2% base
Analyst Consensus (External Reference)
Never blended into the bear/base/bull estimates above.
Average Target (21 analysts)
$7.35
Divergence from AlphaVal
59%
Summary
Using a two-stage FCF DCF with 7% growth decelerating over 15 years, discounted at 11%, the base-case intrinsic value is $2.99 per share.
Warnings
Wall Street's average price target is $7.35 (from 21 analysts). Our estimate is 59% below the consensus -- consider that gap carefully.
Financial statements were converted from INR into USD using USDINR at 0.0105 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