HCL Tech Q1 net falls 8% YoY to Rs 2,220 crore, EBIT falls 2.8% YoY

HCL Technologies (HCL Tech) on Wednesday reported a 7.6 per cent year-on-year (YoY) fall in its net profit at Rs 2,220 crore for the quarter ended June 30, 2019. On sequential basis, the profit dropped 13.5 per cent.

Revenue for the quarter under review came in at Rs 16,425 crore, up 18.4 per cent YoY and 2.7 per cent on quarter-on-quarter (QoQ) basis. HCL Tech also announced dividend of Rs 2 per share.

Earnings before interest and tax (Ebit) stood at Rs 2,806 crore, down 7.7 per cent QoQ and 2.8 per cent YoY.  Ebidta margin decline to 20.7 per cent in the recentky concluded quarter, as compared to 23.2 per cent in the year-ago period. 

“With a rapidly changing global ecosystem and ever-evolving technologies, we believe in building transformational partnerships and long-lasting relationships with our customers by delivering valuable services, products and platforms. Given our deep commitment to be a responsible organization, we continue to remain focused on driving diversity, CSR and sustainability as an intrinsic part of the way we conduct business”, said Shiv Nadar, chairman & chief strategy officer at HCL Technologies in a results release.

Click here to view the results

In US dollar terms, revenue grew 15 per cent YoY to $2,364 million. On sequential basis, the figures grew 3.8 per cent. In constant currency terms, revenue grew 4.2 per cent QoQ and 17 per cent YoY. 

The company guided for 14 per cent to 16 per cent revenue growth in FY20 in constant currency terms and maintained FY20 EBIT margin guidance of 18.5 to 19.5 per cent.

Analysts at Edelweiss Securities had pegged HCL Tech's revenues to grow 2.7 per cent in US dollar terms and 2.9 per cent in constant currency terms. "The growth forecast is trimmed because the company will not be realising close to $50 million of revenue which was expected to be on its books by Q1FY20 as a result of the IBM IP acquisitions," analysts at the brokerage firm had written in a results preview note. Click to read analysts' view

"HCL’s strong growth at 17% YoY in constant currency, led by double digit growth across Segments. IT and Business Services 18.1%, Products & Platforms 15.2%, Engineering and R&D Services 13.3% (on YoY Constant Currency basis)," the company said in its press release while announcing the results for the recently concluded quarter.  Click to view segment-wise numbers