 "C Vijayakumar, CEO & MD, HCLTech")
India’s third largest IT services firm HCLTech expects FY25 revenue growth to be in the range of 3 to 5 per cent in constant currency terms. The guidance bore the impact of an uncertain macro environment, though it was much stronger than the country’s second-largest IT major Infosys. The Noida-headquartered IT firm on Friday reported a net profit of Rs 3,986 crore for the quarter ended March 2023 (Q4FY24), up 0.1 per cent on a year-on-year (Y-o-Y) basis. While the net profit was marginally up Y-o-Y, it was down 8.4 per cent on a sequential basis. Revenue for the quarter grew 7.1 per cent Y-o-Y at Rs 28,499 crore. On a sequential basis, it was marginally up by 0.2 per cent. HCLTech revenue guidance for FY25 was higher than Infosys 1-3 per cent.
Though HCLTech’s growth numbers were better compared to peers, they missed Bloomberg estimates. The Bloomberg estimated revenue to be at Rs 28,557 crore and net profit at Rs 4,123 crore.
For the full year, HCLTech revenue grew 8.3 per cent at Rs 109,913 crore compared to FY23. In terms of US dollars, the firm’s revenue touched $13.27 billion. Net profit for the full year grew 5.7 per cent at Rs 15,702 crore.
The total contract value (TCV) for the fourth quarter came in at $2.29 billion, up 19.2 per cent from $1.92 billion in Q3FY24. For the full year, the TCV stood at $9.7 billion, including 73 large deals.
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On a softer guidance compared to the FY23, C Vijayakumar, MD and CEO HCLTech said: “We continue to remain optimistic about the opportunities ahead of us. We have reported industry-leading performance. As we step into FY25, some of the large deals will move into the global delivery model mode and we will have some reduction in revenue. With the microenvironment continuing to be as it is, our assumption is we will continue to see similar growth that we saw in FY24.”
The growth driver for the company in terms of geography continued to be North America and Europe. Unlike some of its larger peers who have seen the US growth falling, HCLTech reported a growth of 4.2 per cent in Q4. Europe grew 2.3 per cent. Similarly, Banking, Financial Services and Insurance ( BFSI, one of the largest segments for the industry and the company, grew at 2.8 per cent sequentially and 8.6 per cent Y-o-Y.
The biggest contribution came from telecommunications, media, publishing and entertainment, growing 21.6 per cent sequentially and 39.2 per cent Y-o-Y. HCLTech services, which is the services offering, grew 3 per cent sequentially. HCLTech was also the only among the top four IT firms that added headcounts. For the full year, the firm has a net addition of 15,000 employees, taking the total to 227,481. During Q4, the company added 3,000 freshers and for the full year, it added 12,000 from campuses.
For FY25, the company intends to add around 10,000 from campuses. It is the only company after TCS that shared campus recruitment numbers. The attrition for Q4 came in at 12.4 per cent, down from 12.8 per cent in the preceding quarter.
