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Wipro advances 3%, hits fresh high; trades above share buyback of Rs 400

In the past three months, share price of Wipro gained 14 per cent but underperformed its peers HCL Technologies and Infosys, which rallied 20 per cent and 23 per cent, respectively

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Wipro | Buzzing stocks | Markets

SI Reporter  |  Mumbai 

Wipro
The board of directors of Wipro is scheduled to meet on January 13, 2021 to approve Q3FY21 results

Shares of hit a fresh all-time high of Rs 410, up 3 per cent on the BSE, in intra-day trade on Tuesday and was quoting above its buyback price of Rs 400 per share.

IT services major Wipro's share buyback programme commenced on December 29 and will close on January 11, 2021. In November, shareholders had approved the buyback plan for purchase of up to 237.5 crore equity shares at Rs 400 per share, aggregating to an amount of up to Rs 9,500 crore.

In the past three months, share price of gained 14 per cent but underperformed its peers HCL Technologies and Infosys, which rallied 20 per cent and 23 per cent, respectively. In comparison, the S&P BSE Information Technology (IT) index was up 21 per cent during same period.

said the buyback is being undertaken by the Company to return surplus funds to the equity shareholders, which are over and above its ordinary capital requirements and in excess of any current investment plans, in an expedient, effective and cost efficient manner.

"The buyback will help the Company distribute surplus cash to the equity shareholders broadly in proportion to their shareholding, thereby, enhancing the overall return to equity shareholders. The buyback it would help in improving financial ratios like earnings per share and return on equity, by reducing the equity base of the Company," it said.

Meanwhile, the board of directors of Wipro is scheduled to meet on January 13, 2021, to consider and approve the audited financial results of the Company for the quarter ended December 31, 2020 (Q3FY21). The board will also consider the declaration of interim dividend, if any, for the financial year 2020-21, it said.

In December, Wipro had signed a $700-million digital and IT partnership deal with Metro AG, that will see over 1,300 employees of the German wholesaler move to the Indian IT major. As a part of this transaction, Wipro will take over the IT units of Metro AG — Metro-NOM GMBH in Germany and Metro Systems Romania S.R.L, the company said in press release.

Meanwhile, according to Emkay Global Financial Services, barring Tata Consultancy Services (TCS) and Coforge, all other companies are expected to report EBITM (earnings before interest, taxes and corporate overhead or management fees) expansion on a YoY basis due to low travel costs and weak rupee. IT companies have rolled out wage hikes and promotions, which may weigh on qoq performance, the brokerage firm said in IT sector Q3FY21 preview.

Deal wins remain healthy in Q3, driven by digital deals, vendor consolidation deals, core transformation deals and integrated mega deals. Ram-up of deals is progressing on expected lines and the decision-making cycle on deal closures remains largely normal, it said.

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First Published: Tue, January 05 2021. 14:43 IST
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