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Wednesday, June 19, 2024

Wipro made a village full of millionaires; Here’s how the company did it

Azim Premji’s father, Mohammad Hussain Premji, started WIPRO Ltd. in 1947 to manufacture Vanaspati ghee, laundry soap, and cooking oil. It was not an IT firm at the time.

WIPRO Ltd.’s current chairman Azim Premji’s father Mohammad Hussain Premji established the first facility of Western Indian Vegetables Product Limited (WIPRO Ltd) in Amalner, a tiny town in Maharashtra, in 1947 to create Vanaspati ghee, laundry detergent, and cooking oil. No, it wasn’t an IT firm back then.

Many Amalner inhabitants worked at the facility, and some were awarded stock in the firm. Residents of Amalner are expected to possess around 3% of WIPRO, equal to 250 crores of shares worth 3448 crores.

Mr. Azim Premji, a well-known businessman, became Chairman of the firm in 1966. In 1970, the business held an initial public offering (IPO) with a face value of 100 INR. The corporation has evolved into a multi-conglomerate, with a share price of 591 INR.

One would believe it’s only a five-fold price gain, but the corporation distributed bonus shares several times over this time period. If a person purchased 200 shares of Wipro for 10,000 INR or $200 USD, he would currently hold 96,00,000 shares valued close to 500 Crore or 67 million USD. And a sizable dividend during this time span.

Amalner hamlet owns about 3% of Wipro shares, and several residents have become billionaires solely via dividends from the firm.

Azim Premji took over Wipro at the age of 21. During the 1970s and 1980s, the firm focused on new potential in the IT and computer sector, which was still in its infancy in India at the time.

Wipro expanded their consumer product portfolio with the introduction of “Ralak,” a Tulsi-based family soap, and “Wipro Jasmine,” a toilet soap.

WIPRO is more than a corporation to the residents of Amalner. Indeed, one widespread saying at Amalner is that if you acquire 10 shares of WIPRO the day your child is born, you would be able to pay for the child’s higher education or marriage over the years.

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