Wipro to consider issuance of bonus shares, share gains

Shares of IT major Wipro Ltd rose 3% in early trade on Monday after the company said it would consider a bonus share issue on October 17. Shares of Wipro rose 3% to Rs 545.35 on BSE in early trade today. Wipro’s market capitalization stood at Rs 2.83 lakh crore crore. A total of 0.60 lakh shares of the company changed hands, amounting to a turnover of Rs 5.11 crore on BSE.

In technical terms, Wipro’s relative strength index (RSI) stands at 47.6, signaling that the stock is neither oversold nor overbought on the charts. IT stocks are trading above the 5-day, 10-day, 20-day, 50-day, 100-day, 150-day and 200-day moving averages.

The IT company last announced bonus shares in 2019 when it issued one bonus share for every three shares held by shareholders. The Bengaluru-based IT services provider will also announce September quarter results on October 17.

Axis Securities expects HCL Tech to report revenue decline of 2.3% QoQ in rupee terms and operating margin expansion of 51 basis points.

The key factors to watch out for are a) Business TCV/Business Pipeline, b) Pricing Scenario and c) Growth Outlook, Operating Margins and P&P Business, the brokerage said.

Anand Rathi, in his Q2 earnings preview, said, “We expect IT companies to report a stable second quarter, led by gradual recovery in US BFSI. Divergence in revenue growth persists. Mid-tier companies should continue to perform well and we expect its superior performance to be sustained over the medium term.”

Wipro reported a 5.21% year-on-year (YoY) increase in consolidated net profit of Rs 3,036.60 crore in the first quarter, compared to Rs 2,886 crore in the same quarter last year. Revenue fell 3.79 percent to Rs 21,963.80 crore in the June 2024 quarter as against Rs 22,831 crore in the corresponding quarter last year. Wipro’s IT services revenue was Rs 21,896 crore.

The IT company said it expects September quarter revenue from the IT services business segment to be in the range of $2,600 million to $2,652 million. This equates to a sequential guidance of minus 1% to 1% in constant currency terms.