Shares of Wipro have closed below the key Rs 400-mark in the last six consecutive sessions signaling a bearish trend for the IT major. The stock, which is the cheapest among the IT biggies in terms of price, is slowly heading towards its 52-week low hit on October 17, 2022. In the current session, the Wipro stock was trading 3.8% away from the 52-week low. The stock fell 0.58% to Rs 387.45 against the previous close of Rs 389.70 on BSE.
Wipro shares have declined 42.19% in the last one year and fallen 46% in 2022, making them the biggest losers among the IT behemoths. Market cap of Wipro fell to Rs 2.12 lakh crore on BSE today. Total 0.98 lakh shares of the firm changed hands amounting to a turnover of Rs 3.79 crore on BSE. Market cap of the firm fell to Rs 2.12 lakh crore in the afternoon trade today.
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Compared to the 52-week high of Rs 726.70 on January 3, 2022, Wipro stock has declined 46.71% till date.
Shares of other IT behemoths too have fallen but lesser in percentage terms compared to Wipro. Infosys stock has lost 20.13% and shares of TCS have tumbled just 14.1% in 2022. During the same period, Sensex has gained 3,350 pts or 5.76% and Nifty has added 5.69% or 930 points.
On the index level too, the sentiment in the IT stocks has remained negative in the last one year and during 2022. BSE IT index has fallen 24.38% or 9,225 points to 28,618 this year. During the last one year too, the index has lost 20.40% or 7,335 points.Similarly, the Nifty IT index has defied the rally in benchmark indices and corrected 26.31% or 10,180 points in 2022. The index has declined 22.19% or 8131 points in the last one year.
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Analysts have attributed the fall in IT stocks especially Wipro to the ongoing Russia- Ukraine war, the economic slowdown and the Covid-19 lockdowns across the globe, which impacted the international business of the Indian IT firms during the period.
Here’s a look at what analysts said on the prospects of the IT stock.
Gaurav Ratnaparkhi, Head of Technical Research at Sharekhan by BNP Paribas expects the Wipro stock to double in a time span of 3-5 years. “Wipro breached its 200 day moving average (DMA) in January 2022. In March 2022, the stock attempted to reclaim the key long-term moving average however stumbled over there & had a significant correction in the subsequent period. So the stock has already spent substantial time below the 200-DMA. The key moving average currently stands near Rs 450. A higher time frame i.e. the monthly chart shows that the stock has retraced 61.8% of the rally from March 2020 to Oct 2021. For the last few months, the stock is trading near this Golden Ratio mark. So the stock is in process of forming a base for itself; however it is yet to complete the base formation. Once that is done, the stock will be set for a multi-year bull run & will have the potential to double in price in around 3-5 years,” said Ratnaparkhi.
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AR Ramachandran from Tips2trades expects shares of Wipro to nearly double if they close above Rs 520 on a monthly basis.
“Despite steady fundamentals, IT stocks have seen a good correction in 2022 this far with Wipro falling quite sharply from its 52-week high. In the worst-case scenario, assuming an already long term heavily oversold US tech index continues its brutal fall further in 2023, Wipro stock price could test Rs 312-320 on the lower side. Long-term investors should use current and possibly lower levels to accumulate this stock for a target of at least Rs 520 by the end of 2023. A monthly close above 520 should again pave the way for 700 in the long run,” said Ramachandran.