Wipro Launches Record Rs 15,000 Crore Share Buyback Despite Financial Headwinds
In a significant corporate move, Bengaluru-based IT giant Wipro has approved its sixth and largest share buyback to date, valued at a staggering Rs 15,000 crore. The buyback, set at Rs 250 per share, marks a strategic effort to bolster shareholder value even as the company grapples with lackluster financial performance. Founder Azim Premji and the promoter group are poised to actively participate in this initiative, underscoring their commitment to the firm's long-term stability.
Details of the Buyback and Capital Allocation Strategy
As part of its comprehensive capital allocation strategy, Wipro's board has proposed repurchasing up to 60 crore equity shares, each with a face value of Rs 2. This represents approximately 5.7% of the total paid-up equity capital and will be executed through a proportionate tender offer route. This buyback surpasses the previous record set in April 2023, when the company approved a Rs 12,000 crore buyback at Rs 445 per share, targeting nearly 27 crore shares or about 4.9% of outstanding equity. During that earlier buyback, Premji and the promoter group tendered around 19.4 crore shares, amounting to Rs 8,612 crore, demonstrating a consistent pattern of involvement in such financial maneuvers.
Financial Performance and Market Sentiment
The announcement comes against a backdrop of weak financial results for Wipro. In the March quarter, the company's IT services revenue showed minimal growth, rising only 0.2% sequentially in constant currency terms and declining 0.2% year-on-year. In reported terms, revenue increased 0.6% sequentially to $2.6 billion, with a year-on-year growth of 2.1%. For the full fiscal year FY26, IT services revenue declined 0.3% in dollar terms to $10.4 billion and fell 1.6% in constant currency. These figures, coupled with subdued guidance for the upcoming quarter, have weighed heavily on investor sentiment, leading to a nearly 5% drop in Wipro's shares during early Thursday trading on the New York Stock Exchange.
CEO Insights on Market Challenges and Outlook
Wipro CEO Srini Pallia addressed the company's challenges, highlighting that geopolitical and policy disruptions have become the new normal in the global landscape. "Changing trade rules, tighter immigration policies, and prolonged conflicts continue to create uncertainties for industries and economies," Pallia stated. Despite these headwinds, he noted that IT spending has shown resilience, with client priorities shifting towards outcome-based spending decisions. For the June quarter, Wipro expects IT services revenue to range between $2.6 billion and $2.65 billion, implying sequential growth of -2% to 0% in constant currency terms. Pallia attributed the subdued outlook to specific client account issues, including delays in ramping up a recently won deal, which are factored into the guidance.
Human Resources and Workforce Trends
On the human resources front, Wipro added 8,810 employees during FY26, with a modest increase of just 135 in the March quarter, bringing the total workforce to approximately 2.4 lakh employees. HR head Saurabh Govil revealed that the company onboarded 7,500 freshers in FY26, including over 3,000 in the March quarter alone. This hiring strategy reflects Wipro's efforts to balance cost management with talent acquisition amid fluctuating demand in the IT sector.
In summary, Wipro's record share buyback represents a bold step to enhance shareholder returns despite ongoing financial pressures and market volatility. As the company navigates a complex global environment, its strategic moves will be closely watched by investors and industry analysts alike.
