Wipro buyback to open on June 22: All you need to know!
Major highlights
- IT major Wipro recently announced the opening date of its Rs 12,000 crores share buyback.
- The buyback opens on Thursday, June 22 and will close on June 29.
- The company fixed June 16 as the record date of the buyback.
IT major Wipro recently announced that its share buyback will open from June 22 and will close on June 29. The buyback is a tender offer and the company has plans to buy 26.96 crore shares through this buyback offer.
A tender offer buyback is one in which the company makes an offer to buy back its shares at a particular price at which the shareholders can tender their shares. The amount is then credited to the shareholders' primary bank account.
Wipro share buyback price
Wipro, at its board meeting on April 27, announced that it will carry out the buyback at a price of Rs 445 per share. This denotes a premium of 16.2% from the closing price of Rs 383.35 as of 20th June, 2023.
With an aim to buy 26.96 crore shares, the company will spend roughly Rs 12,000 crores on this buyback.
Notably, this will be the fifth buyback conducted by the IT company in its history.
Wipro share buyback: Impact on financials
Post the buyback, the company expects mixed fortunes for its financials.
While the company expects the return on net worth to improve to 17.28% post the buyback from 14.61%, the earnings per share is also expected to rise from Rs 20.68 per share to Rs 21.75 per share.
However, Wipro forecasts its net worth to decrease to about Rs 65,667.9 crores post the buyback from Rs 77,667.9 crores.
Reasons for the Wipro share buyback
- This share buyback exercise is being undertaken by Wipro to return surplus cash to shareholders.
- Wipro expects the buyback to improve its financial ratios like earnings per share and return on equity.
Wipro share price performance
The buyback has not been able to arrest the decline in Wipro share price in recent times. This can be attributed to the headwinds witnessed in the IT sector along with some company specific developments. In the past month, the Wipro share price has eased by 3% and in 2023 so far, it has declined by 2.5%.
Wipro Q4 earnings
Like its fellow peers in the IT sector, Wipro had a muted March quarter.
- For the Jan - Mar ‘23 period, Wipro revenues came in at Rs 23,190 crores. This denotes a growth of 11.2% from the previous year.
- Wipro reported a consolidated net profit of Rs 3,093.5 crores for the Jan - Mar ‘23 period. This remained flat from the previous year’s figure of Rs 3,092.5 crores.
- Wipro declared a dividend of Rs 1 per share.
This is not investment advice. Investments in the securities market are subject to market risk, read all the related documents carefully before investing. Past performance is not indicative of future returns.