Wipro shares surge on strong growth prospects

BANGALORE: Shares of India's diversified information technology firm Wipro

Ltd. were up over one per cent on Friday afternoon, boosted by prospects of

strong growth, analysts said.

At 1.20 p.m. (0750 GMT), the share was up 1.3 per cent at Rs 3,085 rupees but

off a morning high of Rs 3,165 in a volume of over 500,000 shares. The main

Bombay index was down 0.19 per cent at 4,450.64 points. The share has risen 27

per cent in August but is down substantially from its calendar 2000 high of Rs

9,800 reached in February. It is, however, up from its year low of Rs 1,474 hit

on May 26.

Analysts said Wipro’s first quarter performance had triggered renewed

interest in the stock and it was expected to post strong earnings growth during

2000-01 (April-March). Wipro beat market expectations with a 129 per cent jump

in net profit to Rs 1.08 billion ($23.53 million) for the first quarter ended

June 30, 2000.

Merrill Lynch on Thursday said it expects Wipro's margins to rise in the

current year on higher billing rates. Merrill, which has a buy on the stock, set

a 12-month price objective of Rs 3,400. The report, dated August 23, was based

on a share price of Rs 2,773.

It said the company was getting strong order flows and its e-commerce foray

was paying off. But some analysts said Wipro continued to remain expensive.

"I just can't see value at these levels," said an analyst at a

European securities firm.

(C) Reuters Limited 2000.