Wipro rallies 5%, hits fresh 20-year high on share buyback plan

Wipro's board will meet on Tuesday, October 13 to consider buyback proposal.

Shares of Wipro surged 5 per cent at Rs 353, hitting a fresh over 20-year high on the BSE in the early morning trade on Thursday after the company said the board will consider a buyback proposal on Tuesday, October 13. The stock hit a record high of Rs 368 on February 22, 2020.

Wipro is the third information technology (IT) company after Tata Consultancy Services (TCS) and Majesco to consider share buyback. TCS on Wednesday announced Rs 16,000 crore buyback at Rs 3,000 per equity share.

Earlier, on October 1, Wipro informed the stock exchange that the meeting of the board of directors of the Company is being scheduled to be held over October 12-13, 2020, to consider financial results for the quarter ended September 2020 (Q2FY21).

“It is hereby informed that the board of directors will be considering a proposal of buyback of equity shares of the company at the aforesaid meeting scheduled to be held on October 13, 2020. The outcome of the Board meeting will be communicated to the stock exchanges soon after the conclusion of the Board meeting on October 13, 2020,” Wipro said in an exchange filing on Wednesday after market hours.

Meanwhile, ICICI Securities expects Wipro’s global IT services revenues to increase 1.1 per cent quarter-on-quarter (QoQ) in constant currency mainly led by project ramp-ups and lower base in the previous quarter. Further, with the cross-currency tailwind, the brokerage firm expects dollar revenues to increase 2.4 per cent QoQ. EBIT margins in global IT services are expected to increase 20 basis points QoQ to 19.2 per cent, mainly led by operating leverage benefit.