HCL Infosystems Limited
today announced its financial results for the quarter ended September 30, 2021. The company’s Q2FY22 revenue was Rs15.54cr. Systems Integration and Solutions business reported revenue of Rs14.89cr. Loss Before Tax and exceptional items was Rs20.78cr. Exceptional non-recurring gain during this quarter on account of:
Profit on sale of properties was Rs33.85cr.
Profit Before Tax after considering exceptional items Rs13.07cr.
The company stock was bullish on Wednesday and at around 11.20 am, HCL Infosystems Ltd was trading at Rs13.89 per piece up by Rs0.41 or 3.04% from its previous closing of Rs13.48 per piece on the BSE.
Raj Sachdeva, Manager of HCL Infosystems Ltd, commenting on the results’ said, “During the quarter, the company continued to focus on initiatives like monetization of properties and along with realization of tax refunds to help in reduction of debt and losses.”
In the System Integration and Solution business, we continued to focus on deliverables of existing projects and collection of receivables from customers.”
Divestment of HCL Infotech Ltd.
The Board of Directors of HCL Infosystems Limited in its meeting held on February 10, 2021, had approved to sell the entire shareholding held by HCL Infosystems Limited in HCL Infotech Limited at “Net Asset Value” as on closing date, after acquiring the undertaking which shall comprise of the business relating to specific projects through a business transfer agreement, certain other assets and liabilities through assignment deed and HCL Investments Pte., Singapore & it’s step down subsidiary through a share purchase agreement. The sale will be made to Novezo Consulting Pvt. Ltd based on the terms and conditions as specified in share purchase agreement dated February 10, 2021.
MSP Contract with Unique Identification Authority of India (UIDAI)
One of the large projects of the Company, as Managed Service Provider (“MSP”) with the Unique Identification Authority of India (‘UIDAI’) and ad hoc arrangements with UIDAI thereafter, ended on 6 April 2021 and annual maintenance contracts (“AMC”) and software licences to UIDAI ended on 6 August 2021.
Restructuring of the Company
The Board of Directors of HCL Infosystems Limited in its meeting held on August 6, 2020 had approved the merger. The Company had filed a petition with the National Company Law Tribunal on September 21, 2020 for approval of the proposed merger of HCL Learning Limited and Digilife Distribution and Marketing Services Limited (DDMS) with HCL Infosystems Limited. HCL Learning and DDMS are wholly owned subsidiaries of the Company.
Pursuant to the directions of the Hon’ble NCLT, a meeting of the Equity Shareholders and Unsecured Creditors of the Company will be held on 30th November, 2021 for the purpose of approving the proposed merger.
Divestment of Property
In order to reduce company's debt obligations, the Company has decided to monetize Company owned properties in a phased manner. Several of Company's properties are not being fully utilized due to changes in the business of the Company. The Company has sold two properties during the quarter for a total consideration of Rs45.84cr. During the current year, the company has sold five properties for a total consideration of Rs121.94cr. The Company is actively looking for buyers to monetize other properties.
Income tax refund
During the quarter, the Company has received Income Tax refund of Rs8.68cr including interest of Rs0.88cr. The total amount received during current financial year till October 2021 is Rs104.95cr including interest of Rs14.95cr.