Exclusive: Wipro Shares Bear The Brunt Amid Flurry Of Top-Level Exits

The IT giant, Wipro was recognised as one of the world's most ethical companies by Ethisphere Institute in 2021 for tenth year in a succession. But, things are changing rapidly and certainly not in a way that that company would have desired. A flurry of top-level exits at Wipro has turned the spotlight on country's leading IT Software company, which is engaged in the restructuring of its business.

With recent resignation of Jatin Dalal (on September 21, 2023) who held the position of Chief Financial Officer at Wipro, the company in 2023 only witnessed several top-level exits. The large cap IT company has seen exits of India head Satya Easwaran, Chief Operation Officer Sanjeev Singh, iDEAS business head Rajan Kohli, VP Gurvinder Sahni, CFO Kamini Shah, CFO Nithin V Jaganmohan, head of healthcare and medical devices unit Mohd Haque, Ashish Saxena, who headed manufacturing and hi-tech business unit.

Meanwhile, soon after Dalal stepped down, Wipro appointed Aparna C Iyer for the post of CFO and issued a BSE filing informing her appointment. "Aparna is an accomplished, results-driven leader. Throughout her 20-year career with Wipro, she has been a dynamic, forward-thinking strategic partner to our business leaders. She has been integral to our finance transformation over the last few years, playing a key role in our financial strategy and planning, investment programmes, and transformation initiatives," said Thierry Delaporte, Chief Executive Officer and Managing Director, Wipro Ltd.

Jatin Dalal has been the CFO since 2015 and a Wipro veteran for more than 21 years. His last day at the company will be November 30.

Amid the hi-profile exits in Wipro, the shares of company are also sliding depicting the inside picture of the company. Current market price of Wipro share on BSE is Rs 418.65 per share with intraday fall of 2.32%. In last 1-week only, Wipro shares declined 5.09% and over 2% in last 2-weeks. Wipro stock gained just 5.20% in last 1-year and fell again 37% in last 2-years. The stock's 52-week high price is Rs 443.60 apiece and 52-week low price is Rs 351.85 apiece, respectively. The company has a market capitalisation of Rs 2,18,608.56 crore as on September 25, 2023.

Earlier this year in July, the IT giant announced its Q1 FY24 results where it declared its profit at Rs 2870.10 crore, up 12% as against Rs 2,563.60 crore during the corresponding quarter last year. It announced its revenue at Rs 22,831 crore, up 6.1% as compared to Rs 21,528.60 crore in Q1 FY 2023.

Axis Securities said, "We don't see tailwinds for (Wipro's) margins especially with elevated onsite expenses and persisting supply-side pressures." Management's commentary on smaller deals will play crucial role in Q2, added the analyst.

The tier-1 information technology (IT) company's shares underperformed the Nifty IT index so far in 2023. Wipro share trades at FY25 price-to-earnings of nearly 17 times, according to Bloomberg data, a discount to TCS and Infosys. It is unlikely that this trend would reverse anytime soon until there is more indication of a catch-up in revenue growth.

Meanwhile, former board member of Wipro, Suresh Senapaty urged Wipro to work harder towards retaining its talent as he expressed his displeasure over the recent exit of Jatin Dalal.

It will be interesting to see how things unfold in Wipro under Thierry Delaporte whose current five-year term will come to an end in July 2025 as company's performance continue to dwindle against its peers. Questions are also popping up whether Delaporte will get the second term.