HCL Tech to focus on hiring freshers, non-linear growth

IT company HCL Technologies plans to hire more freshers in future and eyes increasing revenue from non-linear growth.
     
India's fifth largest software exporter announced a 78 per cent rise in its net income at $77 million on a yearly basis backed by 13 new deals, as the economic recovery slowly takes root.
    
However, rupee appreciation and a loss-making BPO unit pose challenges to the IT company, which will effect a wage hike in July and hire 5,000 freshers this year adding to costs.
   
"Exchange rate volatility, wage hike, hiring are continued processes in IT business and one has to live with such issues. The company has taken various steps to achieve growth even when companies were struggling under recession.
   
"We have taken up non-linear growth model for some of our projects and this has fetched 12 per cent of our revenue. This is the first time we are announcing this. Of course over a period time it (percentage of revenue from non-linear growth) will increase," HCL Tech CFO Anil Chanana told PTI.
    
Non-linear growth is the latest buzzword in the Indian software sector, aimed at pruning down manpower-related HR costs. Under such a model, IT companies don't get paid based on the number of people used on a project but depending on the output.
    
"We have been doing more of lateral hiring than just freshers... Of course the lateral hiring is costly. However, going forward, we have decided to rely more on freshers, train them and use them. So we will be increasingly using freshers in our business," Chanana said.
   
Posting robust results for the March quarter, the company has a net debt position of $104 million as on March 2010. It generated $250 million cash in the first nine months of 2009-10 against $200 million in the previous year.
    
The company's hedges are at $468 million. In addition we have foreign currency loan on our balance sheet worth $300 million, which acts as a natural hedge, said Chanana.
    
This hedge position of $468 million is enough cover for the next two quarters. These were taken three years back and will get utilised over a period of time. Significant portions of this will get utilised in the April-June and July-September quarters, Chanana said.