HCL Technologies revenue up 16% in first quarter

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Global IT services major HCL Technologies Ltd. on Wednesday reported a consolidated net profit of Rs 2,047 crore for first (April-June) quarter of fiscal 2016-17, registering 14.8 per cent year-on-year (YoY) growth.

The Noida-based software firm said its consolidated revenue grew 15.9 per cent YoY to Rs 11,336 crore under the Indian accounting standard.

Revenue in constant currency was up 11.2 per cent YoY.

Under the International Financial Reporting Standard (IFRS), consolidated net income was up 9.5 per cent YoY to $305 million and consolidated revenue up 10 per cent YoY to $1,691 million ($1.7 billion).

On standalone basis, its net income was Rs 1,799 crore and revenue Rs 4,829 crore for the quarter under review (Q1).

Revenue for this fiscal (2016-17) is expected to grow 12-14 per cent in constant currency.

“As our revenue guidance for fiscal 2016-17 is based on fiscal 2015-16 average exchange rates, it (projection) translates into 11.2-13.2 per cent in dollar rate on June 30,” a company statement said.

Operating margin (earnings before interest and tax) for this fiscal year (FY 2017) is expected to be 19.5-20.5 per cent.

“As changing global socio-economic landscape transforms the dynamics of the industry, enterprises are redesigning their strategies and business models. We are among a few pure-play services providers to have built a robust business model for future growth,” HCL Chairman Shiv Nadar said on the occasion.

The company’s revenue growth across segments for the quarter was driven by infrastructure services, contributing 18 per cent, engineering and R&D services 10.4 per cent, business services 10.1 per cent and application services 4.7 per cent.

“We continue to create sustained positive impact on the ecosystem in which we operate. HCL Grant, the first of its kind initiative launched last year to recognise the rise of the fifth estate – NGOs is playing a larger role in transforming healthcare, environment and education sectors,” Nadar said in the statement.

Fixed price and managed services accounted for 61 per cent of the consolidated revenue.

“Our growth momentum is broad-based, encompassing all sectors and service lines, propelled by our robust 21 century enterprise strategy and business model”, said chief executive Anant Gupta.

The company declared a whopping 300 per cent interim dividend of Rs 6 per share of Rs 2 face value.

The return on equity was 28 per cent for the last 12 months ending June 30.

“We were able to maintain margins led by increased adoption of automation and higher off-shoring. Our layered hedging policy allowed us to manage currency volatility during the quarter and post-exchange gains, added chief financial officer Anil Chanana.

The company’s blue chip scrip of Rs 2 per share gained Rs 25.30 (3.16 per cent) to quote at Rs 825.90 per share at the end of day’s trading as against Tuesday’s closing rate of Rs 800, opening price of Rs 869, a high of Rs 869 and a low of Rs 817.05 during the intra-day trading session.

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