Wipro Wants to Focus on IT Business

Wipro Wants to Focus on IT Business

Wipro has not performed well on Bombay Stock Exchange (BSE). Its shares have been found to have dropped by 11.43% amounting to Rs 397.20.

Experts have been saying that the decline is the result of transfer of its non-IT businesses to Wipro Enterprises. The latter company is a separate but unlisted company of Wipro. Therefore, there are chances that the decline could have taken place due to same.

To talk about the companies that have been hived off are Wipro's consumer care, hydraulics, medical diagnostic product, lighting and water. It has been said that Wipro has taken such an action on November 1, so that they can completely focus on information technology.

"Demerger of non-IT business will lead to EBITDA and PAT margin expansion of IT business along with ROE expansion going ahead", affirmed India Nivesh Research, a brokerage firm.

De-merger has given birth to a number of discussions as a number of experts have been saying that Wipro must have taken the decision as these businesses must not be generating revenues.

On the other hand, Wipro has been moving as per its announcement. The Karnataka High Court has given green signal to the de-merger scheme. Not only this, they have placed a file for the same as well with the Registrar of Companies.

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