Wipro (WIT) Shares Plunge 7.99% on Seven-Day Losing Streak Amid Sector-Wide Challenges and Analyst Downgrades

Wipro (WIT) shares fell to their lowest level since March 2020 on Friday, with an intraday decline of 2.25%. The stock has now dropped 7.99% over the past seven trading days, marking a seven-day losing streak as investor sentiment remains pressured by sector-wide challenges and mixed corporate developments.

Analyst sentiment has weighed heavily on the stock, with Jefferies downgrading Wipro to "Underperform" on September 3, 2025, citing U.S. tariff uncertainty and a potential slowdown in IT demand. This followed a broader bearish consensus, including three "Hold" ratings and two "Sell" ratings, as of MarketBeat. Meanwhile, Morgan Stanley’s upgrade in June 2025 to "equal weight" has failed to offset persistent skepticism.

Financial performance has also raised concerns. While Wipro met earnings estimates in July 2025, revenue of $2.58 billion fell far below expectations, signaling operational headwinds. Margins and return on equity, though modestly positive, lag behind industry benchmarks. Analysts project only $0.14 in earnings per share for FY26, reflecting muted growth expectations.

Strategic moves to counter sector risks include the August 2025 acquisition of Harman’s Digital Transformation Solutions for $375 million, adding 5,600 employees to bolster engineering capabilities. A partnership with CrowdStrike to develop AI-driven cybersecurity solutions further highlights efforts to diversify into high-growth areas. However, these initiatives have yet to offset broader market pressures.

Regulatory and macroeconomic factors continue to loom. The U.S. H-1B visa policy, including a $100,000 fee increase, has restricted Indian IT firms’ access to U.S. labor markets, a critical revenue stream. Tariff uncertainty, as highlighted by Jefferies, adds to sector-wide risks, with Indian IT stocks facing selling pressure from foreign institutional investors. This has exacerbated Wipro’s decline despite its relatively attractive valuation metrics.

While Wipro’s focus on AI and cybersecurity positions it for long-term opportunities, near-term challenges—including regulatory headwinds, earnings volatility, and sector-specific risks—remain significant. Investors will need to weigh these factors against the company’s strategic investments and market position as the stock navigates a complex operating environment.