Current setup and Live Chart
Wipro Ltd is an IT company listed on the Nifty 50 index. Wipro is currently in a fundamentals vs. guidance regime following earnings results that were considered soft relative to market expectations. However, the company is engaging in a record buyback, but the market does not appear to be currently impressed by this. Therefore, what we are seeing with the Wipro share price is a market that seems more focused on the weak near-term outlook than on capital returns.
A summary of the company’s latest financials shows a service revenue of $2.65 billion, operating margins of 17.3%, and net income of 2.2%. Revenues fell YoY by 1.6%. The company also launched a 15,000 crore rupees buyback program amid ongoing AI investment. The earnings hit from various headwinds is forcing some analysts to downgrade the stock. For instance, Elara Securities, an Indian research firm, cut Wipro’s rating from Reduce to Sell and its target price from 205 rupees to 180 rupees.
Macro Drivers for Wipro Share Price
1. Cautious demand
Reports from Dow Jones Newswires indicate that there are client-specific issues in the US banking, financial services, and insurance (BFSI) market, where some of the company’s top clients are based. Apparently, some of these clients are scaling back on demand for Wipro’s products as they reprioritize their IT budgets. This situation is affecting the company’s BFSI segment and is the primary reason analysts are downgrading the stock.
2. Guidance narrative
Despite the record ₹150bn buyback, the market read-through is weak near-term revenue momentum and delayed deal ramp-ups. The current guidance narrative around Wipro is currently negative.
3. Buyback is weakly supportive
The buyback, which is priced at ₹250/share (a 19% premium), is only weakly supportive and is not expected to solve the demand problem in the near term.
Next Week’s Catalysts for Wipro Share Price
- Weak Q1 outlook vs buyback: Investor stance about the weak outlook versus the record buyback will swing the stock in one direction or the other. The current stance is focused on the weak Q1 outlook, but this may change.
- Sector sentiment: The Indian IT market is currently suffering a risk premium due to lower product demand, AI repricing, and delayed deal ramp-ups. If the market remains concerned about these risk-premia factors, the Wipro share price will remain under pressure despite the buyback premium.
- Deal-win momentum: Total deal wins improved, but remained above the previous year’s benchmarks. Investors will be watching to see how this plays out going forward.
Wipro Share Price Forecast Scenarios
Base case: the stock is expected to remain in a choppy consolidation, with the price skewing more to the downside as the weak forward guidance weighs on the stock, albeit weakly counterbalanced by buyback support.
Bull case: If investors use prudence and a deal-win improvement focus as the positive spin from the weak guidance, supported by the buyback floor, we could see a rebound in Wipro’s share price.
Bear case: If the market remains pessimistic about delayed ramps and stagnant growth in Q2, it could trigger another round of selling.
In other words, demand visibility remains the swing factor that can stave off another round of selling and lead to a rebound in Wipro’s share price. Otherwise, the stock will remain range-bound with a downside bias.
Wipro Share Price: Technical Outlook
The latest recovery attempt following a bounce from the 188.28 support (19 June 2023 and 27 October/12 November 2023 double bottom lows) currently suffers from weak momentum, despite clearing the 204.54 barrier (2 June 2023/16 March 2026 highs). The stock needs more upside push to reclaim the 219.96 resistance and the prior high of 14 September 2023. Only when this barrier is uncapped can we see a move towards the 236.14 resistance, which coincides with a prior support base from 14 April 2025 to 29 January 2026.
However, a stall in the upside move and subsequent breakdown of the 204.54 support will usher in a retest of 188.28. If this pivot is degraded, a further decline towards the 17 April 2023 low at 176.27 will be on the cards.