HCL Tech hits new high on 5-year deal with US-based MKS Instruments

HCL Tech announced a five-year digital transformation deal with US-based MKS Instruments, a global provider of instruments, systems, subsystems and solutions for advanced manufacturing processes

Shares of HCL Technologies hit a new high of Rs 1,315.10, up 3 per cent on the BSE in intra-day trade on Tuesday after the company announced a five-year digital transformation deal with US-based MKS Instruments, a global provider of instruments, systems, subsystems and solutions for advanced manufacturing processes.

In the past one month, the stock of information technology (IT) consulting and software firm has rallied 18 per cent, as compared to a 6 per cent rise in the S&P BSE Sensex.

“HCL will drive digital and cloud-enabled transformation for MKS Instruments through AI/ML-led automation, enhanced user experience with end-to-end Infrastructure services, digital workplace services and IT transformation,” the company said in a statement on Monday after market hours.

Meanwhile, HCL’s board is scheduled to meet on 14 October 2021, to consider unaudited financial results of the company for the quarter and half year ending September 30, 2021. The board will also consider the payment of a third interim dividend for the financial year 2021-22. The record date for determining the entitlement of the shareholders for the payment of aforesaid interim dividend shall be October 23, 2021, the company said.

Analysts at HDFC Securities expect steady upward progression ahead, despite a sub-par performance by HCL in the April-June quarter (Q1FY22). High visibility of FY22E growth is supported by USD 4.8 billion new wins in the past six months and stable renewals, the brokerage firm said.

"Key attributes that support our positive outlook include strong growth momentum in ER&D services (+4.3 QoQ CC) supported by life- sciences and hi-tech verticals; recovery in IT & BS segment ahead, led by integrated apps and infra deals; large deal momentum (eight large services deals and four product wins) with 37 per cent YoY growth in Q1 new TCV; geographical focus on new frontier markets with leadership augmentation; and healthy headcount addition (7,522 net addition in Q1 and ~20k including sub-con over the past two quarters)," the brokerage firm said in Q1FY22 result update.

At 10:58 am, HCL Tech was trading 1 per cent higher at Rs 1,288 on the BSE, as compared to a 0.20 per cent decline in the S&P BSE Sensex. A combined 3.33 million equity shares have changed hands on the counter on the NSE and BSE so far.