12 hours Ago
Wipro Limited (NSE: WIPRO) is currently trading down by -1.84 per cent at ₹572.20 per share as at close of 28th Nov.
However, despite the dip it is trading slightly near its 52 week highs of ₹596.00 and is an astonishing 45% up in the one year period compared to the S&P BSE Sensex’s 19.8%.
The continuous moving up in the stock price is due to its fundamentals and the recent events occurring in the company. Share Financial Overview Wipro boasts a market capitalization of ₹3.005 trillion, backed by strong profitability metrics: Profit Margin: 13.
24% Return on Equity (ROE): 15.56% Diluted EPS (TTM): ₹22.38 Revenue (TTM): ₹886.
79 billion The balance sheet is very strong with ₹511.61 billion in cash and having a very good debt to equity ratio of 23.51%.
Total Levered free cash flow of ₹122.92 billion is an appropriate indication of the sustainable earnings power of Wipro. Recent News: New CEO and Growth Prospects Current Wipro is going through a transition period due to the leadership of a new CEO named Srini Pallia who had the internal background.
Such strategic leadership change, combined with the high discretionary spending portfolio of Wipro, puts the company in a good stead to take on the macroeconomic recovery and the consequent surge in IT outsourcing demand. Earlier this week, brokerage firm Nuvama Institutional Equities raised Wipro’s rating to “Buy” with a target of ₹ 700 implying a 20% appreciation. The graph analysis also showcases Nuvama’s indicator of Wipro’s ability to rebound, given the anticipated increased demands by the BFSI and IT industry foreshadowed by peers like Infosys and Accenture.
Additionally, Wipro's decision to issue bonus shares in a 1:1 ratio by December 15, 2024, aims to enhance liquidity and reward shareholders. Technical Analysis Wipro's technical outlook supports its bullish trend. The daily Relative Strength Index (RSI): 63.
3, suggesting the stock is neither overbought nor oversold. Looking at Moving Averages, the stock is trading above key averages, including the 5-day, 50-day, and 200-day moving averages. Rupak De from LKP Securities projects a near-term upside toward ₹630, with downside support at ₹559.
If the bullish momentum continues, the stock may break and close above the ₹610 resistance level and push upwards to challenge its all-time high of ₹739. Pros and Cons of Investing in Wipro Strong Performance: Strong one-year return of 45.51%, outperforming market indices.
Growth Catalysts:New leadership, better economic climate, and increasing need for information technology solutions. Bonus Issue: Bonus equity shares for shareholders in order to enhance the value of the share among the shareholders. Valuation Concerns: Current PE ratio of 25.
69 may suggest limited upside. Sector Volatility: Dependence on discretionary spending makes Wipro susceptible to economic cycles. Mixed Analyst Ratings: 56% of analysts rate the stock as a "Sell," indicating skepticism about sustained growth.
Recommendation: Buy, Hold, or Sell? Wipro shows an attractive long-term investment case due to its strategic initiatives and macroeconomic tailwinds. For existing investors, holding the stock is recommended, especially given the upcoming bonus issue. New investors may consider buying on dips, particularly near the ₹559 support level if the stock price retraces, to benefit from potential upside toward ₹700 or beyond.
Conclusion Wipro's strategic leadership changes, strong financials and bullish technicals make it a great investment in the IT sector. However, cautious optimism is warranted given valuation concerns and market volatility. With a long-term perspective, Wipro could be a rewarding addition to an investment portfolio.
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