Gradle overrides the manifest values, and I prefer to update build.gradle file rather than manifest. And probably this is the right way using Gradle. Gradle supports product flavours which can be controled via IDE and those product flavors can change many things in our Manifest like package name, version code, version name, target SDK and many other. Then by one click in Android Studio You can change many properties and generate another apk.
You can left the manifest as it is and do all configuration in build.gradle. You can safely remove