India’s Wipro eyes best day in four years on echoing IT peers’ demand revival hopes

(Reuters) – Wipro (NYSE:)’s shares surged about 8% on Monday, set for their best day in nearly four years, after India’s No. 4 IT services company joined its peers in signaling a revival in demand.

The company beat third-quarter revenue and profit estimates on Friday and CEO Srinivas Pallia said, “We see discretionary spending slowly coming back” after facing macroeconomic challenges in 2024.

Wipro’s shares were also among the top percentage gainers on the benchmark Nifty 50 index, which was trading flat. At least eight brokerages raised their rating on Wipro’s stock, while 16 raised their price targets, as per LSEG data.

“Wipro is witnessing a pick up in discretionary spends in its BFSI (banking, financial services and insurance) segment – evident from 11% y/y growth in revenue,” Jefferies analysts said in a note, raising both their rating and price target.

The BFSI segment accounts for about a third of the company’s revenue.

Wipro’s bet of a more promising 2025 echoed similar indications from larger peers TCS, Infosys (NS:) and HCLTech.

India’s $254 billion IT services sector has faced sluggish growth for several quarters due to global macroeconomic uncertainties and inflationary pressures, which have pushed clients to rein in spending. ($1 = 86.4390 Indian rupees)