We have not seen any change in the sentiment, says HCLTech's Vijayakumar

We were always confident of our business mix and our incredible leadership and all other elements, said C Vijayakumar, CEO & MD, HCLTech

Noida-headquartered HCLTech’s third quarter performance was not only a beat compared to its largest peers, but it also highlighted the firm's differentiated strategy. C Vijayakumar, CEO & managing director, HCLTech in an interview with Shivani Shinde talks about the differentiated strategy, how finally the company’s performance is getting market attention and client spends. Edited excerpts…

You had once said that markets have not given due credit to HCLTech even when the company has done better. Looking at the third quarter results and coming out as the best in the pack, how does it feel?

It feels very good. We were always confident of our business mix and our incredible leadership and all other elements. It’s being recognised now by markets as well. It's very good.

But, I look at it as a journey and we have to continuously work towards the performance.

Despite a beat quarter you have reduced the guidance. What is your reading of the client sentiment on budgets?

We have not seen any change in the sentiment. There is a lot more focus on cost takeout, efficiency type of opportunities and a lot of innovation conversations. On GenAI it is still early. We are executing a number of projects but they are still small. We expect that customers are going to evolve their foundational landscape to leverage GenAI at scale, whether its cloud or data, or security in both public and private AI stacks. That is a place where we are having good conversations.

Cloud is another space where there is opportunity. When it comes to Cloud, a lot of customers have already committed capacity to hyperscalers and that journey to cloud needs to happen for them to leverage their existing investments.

On a sequential basis the TCV size has dropped. Can you give some clarity?

The September quarter had a mega deal which spiked our TCV to close to $4 billion. Generally, our run rate is $2 billion and we came at $1.9 billion for Q3. I will not read too much into it. We continue to have a good pipeline, and continue to see good bookings.

We see a number of large deals, especially in the $200 million segment. We see good momentum in the large deal segment.

At a time when unpredictability is high, the products business gives HCLTech a different edge. How do you see your strategy on product offering?

There are strong growth products in our portfolio. Bigfix, Unica, Commerce and AppScan are big growth drivers. We have made a lot of  investments to make these products cloud native. These products can be deployed by customers in the cloud of their own choice, which gives them a lot of flexibility and they can deal with large scale workloads.

This quarter is a good validation that our strategy is working. We grew 5 per cent year-on-year, this growth is higher than our IT services growth. The bold bet we took we had conviction and it's working well for us.

How do you see GenAI panning out for HCLTech?

This quarter we have had 31 deals we are working on but they are sub $1 million.

GenAI is going to be the tip of the arrow. It will drive a lot of surrounding business, that is where we see some good projects coming in.