HCL raises 2023 revenue growth target on order strength

Indian IT services firm HCL Technologies has raised its full-year revenue growth forecast and reported a 7.1 percent rise in September-quarter profit, helped by a rise in new order wins.
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HCL Technologies raised its fiscal 2023 revenue growth forecast to 13.5 percent to 14.5 percent from 12 percent to 14 percent on a constant currency basis, citing strong order bookings and pipeline.

Indian IT services companies’ profit jumped last year as they rode the pandemic-driven demand, but results this quarter have been mixed.

Wipro has posted a drop in profit. Tata Consultancy Services (TCS), India’s largest IT services provider, beat profit estimates but warned of weakness in long-term deals.

HCL narrowed its earnings before income tax (EBIT) margins for year-ending March 2023 to 18 percent to 19 percent from previous forecast of 18 percent to 20 percent.

EBIT margins for the second quarter ending Sept. 30 stood at 18 percent, up from 17 percent in the previous quarter.

The value of HCL’s new deal wins for the quarter stood at $2.38 billion, an increase of 6 percent from the year ago period.

“Our services business grew 5.3 percent QoQ and 18.9 percent YoY in constant currency, led by strong demand for cloud, engineering and digital services,” HCL Technologies Chief Executive Officer and Managing Director C Vijayakumar said.

HCL said its net profit rose 7.1 percent to 34.89 billion Indian rupees ($424.18 million) for the second quarter. HCL Technologies’ revenue from operations jumped 19.5 percent to 246.86 billion rupees.