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Wipro rallies 6% as board mulls bonus issue of shares

The stock rallied 6 per cent to Rs 332 on the BSE after the company announced that its board will consider bonus issue of shares in its meeting on January 17-18, 2019.

SI Reporter  |  Mumbai 

Wipro rallies 6% as board mulls share buyback

Shares of rallied 6 per cent to Rs 332 apiece on the after the information technology (IT) company announced that its board will consider of shares in its meeting on January 17-18, 2019.

The stock was trading close to its record high of Rs 344 touched on December 12, 2018, on the in intra-day trade.

Earlier, in January 2017, had rewarded investors by issuing bonus shares in the proportion of 1:1 i.e. one bonus equity share of Rs 2 each for every one share held as on the record date.

On January 3, 2019, said that the meeting of the board of directors will be held over January 17-18, 2019 to consider the condensed audited standalone and consolidated financial results for the quarter ended December 31, 2018, and declaration of interim dividend, if any, for the financial year 2018-19.

“We expect Wipro constant currency (CC) revenue to grow 1.2 per cent quarter-on-quarter (QoQ). Reported USD revenues would grow by 0.6 per cent QoQ owing to cross-currency headwind. This translates to a sequential growth outlook of 1-3 per cent. Commentary on BFSI vertical, growth in the European market, large deal wins and digital business would be keenly watched,” the brokerage firm Prabhudas Lilladher said in a quarterly preview.

According to Emkay Global Financial Services, after adjusting a reporting change in India Government business, we expect 2.0% growth in CC terms in Wipro’s IT services business. A 50 bps CC headwind will lead to 1.5% growth in USD terms. Adjusted for one-time client settlement in Q2FY19, we expect margins to remain flat on a QoQ basis as we expect small INR depreciation gains to be re-invested into the business.

“Key things to watch out for Q4FY19 guidance as we believe that guidance below 2-4% QoQ growth would be disappointing, any further announcements on rightsizing viz. business hive-offs and outlook on spending on key clients and in geographies amid expectations of a global slowdown,” the brokerage firm said in IT sector update.

At 11:52 am; Wipro was trading 5 per cent higher at Rs 330 on the BSE, as compared to a 1 per cent rise in the S&P Sensex. The trading volumes on the counter nearly doubled with a combined 8.65 million equity shares changed hands on the BSE and so far.

First Published: Tue, January 15 2019. 11:55 IST