Wipro stock ends over 7% higher on strong guidance

MUMBAI: Shares of Wipro settled with over 7 per cent gain after the IT major reported 11 per cent rise in April-June profit and forecast a strong US-dollar revenue guidance for the next quarter.

After surging 9 per cent to Rs 417.5 in intra-day trade, the stock finally ended at Rs 408.50, up 6.71 per cent from its previous close on the BSE.

Wipro was the top performer at the BSE benchmark index Sensex.

At the NSE, the stock settled at Rs 409.30, up 7.16 per cent.

Following the rally, the company's market value jumped Rs 6,320 crore to Rs 1,00,646 crore.

"IT major Wipro gained around 7 per cent backed by its strong US dollar revenue guidance for Q2 and upbeat management comments which suggested that the outlook for business scenario looked improved," said Milan Bavishi, Head Research, Inventure Growth and Securities.

Wipro on Friday reported 11 per cent rise in June quarter profit on back of an increase in large contracts and said it was upbeat about demand for its outsourcing services.

Controlled by Chairman Azim Premji, Wipro said that April-June quarter net profit at Rs 1,623.3 crore was 10.7 per cent higher than Rs 1,466 crore in the same period a year ago. The year-earlier profit excludes earnings from its non-IT businesses, which were demerged into a privately held company.

"Wipro's Q1 results was broadly in-line with estimates," said Vivek Mahajan, Head of Research, Aditya Birla Money.

Wipro, which does not give annual forecasts, said it expects revenue from the IT services business to increase 2 to 3.9 per cent to USD 1.62-1.65 billion in the current July- September quarter.

Wipro's consolidated sales rose 5 per cent to Rs 9,733.2 crore in the April-June quarter.

In the broader market, the BSE benchmark Sensex ended the day at 19,593.28, down 154.91 points.