HCL Tech Dec qtr profit jumps 27% to Rs.3,982 crore

HCL Technologies Ltd posted robust quarterly earnings, in line with its peers that have seen their businesses flourish as they exploited a global boom in digital services due to Covid.

India’s third-largest software services company by revenue posted a profit of Rs.3,982 crore in the three months ended December 31, a 26.7% increase from the previous quarter, and 31.1% from the year earlier. Profit exceeded the Rs.3,138 crore consensus estimate in a Bloomberg survey of 19 analysts. Revenue grew 3.8% to Rs.19,302 crore in the December quarter from Rs.18,594 crore in the preceding quarter. Revenue grew 3.5% sequentially in constant currency terms. The Noida-based company posted earnings before interest and tax (Ebit) margin of 22.9% in the quarter under review.

The strong performance prompted HCL Tech to lift its revenue forecast for the March quarter. It expects revenue during the quarter to grow 2-3% in constant currency terms, up from its previous estimate of 1.5-2.5%. This would include a contribution from the recently acquired Australian IT firm DWS. HCL also forecast an Ebit margin of 21-21.5% for FY21.

“This solid performance was driven by a robust momentum in our Mode 2 and Mode 3 businesses led by digital, cloud and products and platform segments,” said C. Vijayakumar, president and CEO, HCL Tech. “Our results reflect the success of the strategic investments we have made over the years.”

Dollar revenue grew 3.6% from a year earlier in constant currency to cross $10 billion in the December quarter, helped by new deal wins and demand for digital services.