Following the footsteps of big bellwether Infosys, Wipro is exhibiting the recent malaise prevalent in IT industry. Milking the clients just by offering cheap labor model has its limitation. In the age of machine learning, human clients are learning that instead of paying huge sum to Indian IT companies, they can themselves run their IT operations in India ! Better late than never for clients !
For current slow global growth environment, Indian IT companies profitability has plateau. When clients can only keep the profitability only by cost cutting, it is going to be very tough environment for big Indian IT companies to get juicy contracts. Their profitability is going to reduce a lot in coming days. Only thing can keep them buoyant is the incessant supply of cheap labor.
Technically speaking, we are looking for 400 – 440 for Wipro stock in coming days / weeks. Whether it comes to that support level is not sure but our advantage in trading Wipro is only within such parameters. From there we will trade it from long side, at least for short term and then will take it from there.
Follow us on Twitter @Bombay_Bulls for trade updates.