Bonus Share News: Shares of tech company Wipro rose by 3 per cent on Monday, October 14, as investors flocked to the stock ahead of its meeting on October 17 in which the company's board is scheduled to consider issuing bonus shares.


If the bonus is approved by the board, this will be Wipro's fourth bonus issue so far. Earlier, the company had taken similar corporate action in 2019, 2017 and 2010. The last bonus issue took place in March 2019, when the company issued three shares to stakeholders in exchange for every one share. This time, the bonus issue ratio approved by the board will also be taken into account.

Second quarter results will come
Meanwhile, IT tech sector major Wipro will also release its second quarter earnings on the same day. Analysts expect major IT sector companies to see signs of improvement from the second quarter amid softening of interest rates and possible improvement in discretionary demand.

 

What is a bonus?
A bonus issue is a corporate action in which a company issues additional shares to its existing shareholders at zero additional cost. This is usually done in proportion to their existing holdings, meaning shareholders get a certain number of new shares for every share they already hold. In the case of Wipro, analysts at Nuvama Institutional Equities expect margins to decline due to the impact of a one-month salary hike. All eyes will be on the company's growth guidance for FY25 to gauge whether a recovery can be expected soon. Nuvama estimates that Wipro will guide for Q3FY25 at -1% to 1% in constant currency. The brokerage will also look for updates on Wipro's consultancy business and deal acquisitions. At 10.53 am, Wipro shares were trading at Rs 538.70 on the NSE. At 1:25 pm, the stock was trading 4.03% higher at Rs 549.60. The anticipation of quarterly earnings and bonus share issuance also led to a surge in trading volumes in the counter as 63 lakh shares were traded so far, higher than the average daily turnover of 59 lakh shares in a week.