Wipro shares gain on Citigroup order win in extremely weak market

MUMBAI: Shares of IT major Wipro moved higher in an extremely weak market on reports that the company bagged Rs 2,900 crore outsourcing contract from Citigroup.

According to reports, the tenure of the contract is five years. As a part of the contract, Wipro will be responsible for application development and maintenance, as well as providing IMS services, for Citi's global operations. The contract also requires Wipro to set up a large offshore delivery centre in Bangalore.

The large contract comes at a time when multi-hundred-million dollar technology contracts have become few. Large corporations in the United States and Europe have been cautious on technology spending following a practice of breaking up outsourced contracts into smaller projects, which are given out to multiple service providers.

"Through the acquisition of CTS, Wipro had signed a $500mn 6 year deal with Citi in December 2008. We believe this is positive news for Wipro which has been lagging its peers in terms of growth," said SBICap Securities report.

At 09.45 am, the stock was trading at 346.15. It had high a high of 348.10 and a low of 341.10 in trade today.