Shares of Wipro Ltd touched fresh 52-week highs for five times in the last 12 sessions, indicating a slow yet steady rise in the IT sector stock. The stock has risen just 5% in two weeks. Wipro stock, which hit a 52 week high of Rs 300.85 on December 5 touched a fresh yearly high of Rs 319.95 in the current session. With the current leg of rally, the IT stock has turned overbought on charts with a RSI of 73. This signals there are more buyers than sellers for the stock in the current session.
The IT stock was trading on a flat note after hitting a fresh 52 week in early deals today. Market cap of the firm stood at Rs 3.25 lakh crore. Total 3.20 lakh shares of the firm changed hands amounting to a turnover of Rs 10.04 crore on BSE.
Jigar S Patel, Technical Research Analyst at Anand Rathi Shares and Stock Brokers has advised investors to be cautious in the IT stock.
"Wipro has delivered an impressive rally over the past three months. However, the stock is nearing a critical zone between Rs 320-322 at the current levels, where a bearish Crab harmonic pattern is expected to complete. This zone also aligns with the R5 camarilla pivot resistance, a significant technical hurdle. Considering this confluence of resistance levels, caution is advised. It would be prudent to book profits in the Rs 318-322 range and refrain from initiating fresh long positions, as the risk of a reversal increases in this zone," said Patel.
Brokerage JM Financial has a buy call on the stock with a price target of Rs 620.
Amol Athawale, VP - Technical Research at Kotak Securities has a buy call on the IT stock with a price target of Rs 323. Stop loss can be fixed at Rs 307.
HSBC has upgraded Wipro to hold with a price target of Rs 263.
Morgan Stanley holds an 'underweight' rating and a target of Rs 250 per share.
The global brokerage said after the company's acquisition of Capco in 2021 and then Rizing's acquisition in 2022, it sees the latest target entity - Applied Value Technologies as relatively smaller.
The brokerage stated that the said acquisition will offer more of a capability boost to the Bengaluru-based IT major and also add some marquee clients to its portfolio given the small scale. Additionally, Morgan Stanley expects the acquisition to have a limited impact on the company's (Wipro) financials in FY25/FY26 owing to the small-scale of the acquired entity.
Ameya Ranadive, Chartered Market Technician, CFTe, Sr Technical Analyst, StoxBox said, "Wipro emerges as a compelling buy above Rs 300, with potential upside targets of Rs 325 and Rs 335. However, caution is advised if the stock slips below Rs 290, which could invalidate the bullish outlook."
BNP Paribas in its IT services report has assigned a price target of Rs 232.5 It has a bearish stance on the stock. Wipro stock stood at Rs 299.3 when the recommendation was given.
Brokerage Investec has reiterated its sell call with a target of Rs 290. The brokerage expects an improved capital allocation strategy and enhanced shareholder payouts from the company.
Considering that Wipro holds a significant cash reserve of $6.1 billion, Investec believes that the company’s new capital allocation policy is likely to align with industry peers.
Investec said while the stock may face limited downside from its current levels, the emphasis remains on the potential benefits of the revised policy framework.
On a year-to-date basis, the Wipro stock has gained 30.46% and risen 44.24% in a year. Wipro shares are trading higher than the 5 day, 10 day, 20 day, 50 day, 100 day, 150 day and 200 day moving averages, which indicates the momentum is bullish both in long and short term.