Wipro hives off non-IT businesses, stock gains

Wipro hives off non-IT businesses, stock gains

Last Updated: Thu, Nov 01, 2012 09:00 hrs

India's Wipro says it is separating its core information technology business from its consumer care and lighting, infrastructure engineering and medical diagnostics businesses.

Thursday's announcement sent the stock as much as 4 percent higher in an otherwise flat market.

Chairman Azim Premji says the demerger will enhance shareholder value and "provide momentum for growth."

The non-IT businesses will be folded into a privately held company, called Wipro Enterprises Ltd., while the IT business, which accounts for 86 percent of revenue and 94 percent of operating profit will remain within publicly traded Wipro Ltd.

India's third-largest outsourcer has warned of stalling growth in its core software services business with global clients wracked by uncertainty. The company is scheduled to report quarterly earnings Friday.

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