Amid ongoing coronavirus pandemic, Wipro has assured that neither it has laid off any employee so far, nor it will lay off anyone in the coming times.
The Nifty IT index surged over 6 per cent to hit day’s high of 16,625 on Wednesday with all the 10 constituents trading in the positive territory. After posting a better-than-expected net profit of Rs 2,309.4 crore in the April-June quarter of the current financial year, Wipro share price zoomed 19.4 per cent to Rs 268.70 apiece on NSE. In comparison, the broader Nifty 50 index was up 1.71 per cent. Besides, Infosys, HCL Tech and L&T Infotech shares hit their respective all-time highs in today’s trade. Infosys shares jumped 8.3% to Rs 848.45, HCL Technologies soared 6 per cent to Rs 627.95, while L&T Infotech shares gained 3 per cent to touch a new 52-week high of Rs 2,310. While MphasiS shares hit a day’s high of Rs 994.80 apiece, which is just 0.4 per cent away from its 52-week high of Rs 999.50 on NSE. Similarly, with today’s 19% up move in Wipro, the stock is just 2.69 per cent off from its 52-week high of Rs 276.15, touched in August last year.
“The Q1FY21 revenues were in line with street estimates margins and profits came in well above street estimates due to cost control by the company. Markets will also look forward to management commentary and their outlook for the rest of the year given likely budget cuts by clients,” said Jyoti Roy, DVP- Equity Strategist, Angel Broking Ltd. Amid ongoing coronavirus pandemic, Wipro has assured that neither it has laid off any employee so far, nor it will lay off anyone in the coming times. Wipro Chairman Rishad Premji at the 74th annual general meeting (AGM), said the company has planned for cost reductions through various operational means to survive through the crisis.
“We believe Wipro is a good re-rating candidate due to the upside of a turnaround under the new CEO, the possibility of an impending buyback, and relatively attractive valuations,” said Motilal Oswal in a report. “Before turning constructive on the stock, we await a refresh of the company’s strategy and further evidence related to execution,” the brokerage firm said maintaining a neutral rating on the stock.
Even as US President Donald Trump suspended H-1B visas along with other foreign work visas till December 31, Rishad Premji said that Wipro is safe as it has hired nearly 70 per cent employees in the US from that country. “We were able to increase our margins using three levers. We focused on reducing variable workforce and improved utilisation. Next lever came from 1% benefit from rupee value while the third lever was the operational improvement of 1% which was offset by expected credit loss,” Wipro CFO Jatin Dalal said
Meanwhile, Salil Parekh-led Infosys, along with Larsen & Toubro Infotech Ltd are scheduled to announce their April-June quarter results today. On Tuesday, Infosys in a press release announced that it has partnered with as part of its ongoing strategy to enhance and evolve its full-service defined contribution (DC) business. “This strategic partnership will deliver a technology-driven approach to plan administration and fundamentally reshape the corporate retirement plan experience for its sponsors and participants,” Infosys said.