HCL Technologies stock dips despite Q2 PAT up 3.7% yoy

HCL Tech declared Rs10 interim dividends and this marks the 75th consecutive quarter of dividends.

Oct 18, 2021 10:10 IST India Infoline News Service

HCL Technologies
Shares of HCL Technologies trading in the red zone despite the IT company recorded net profits were up 3.69% on a yoy basis at Rs3,259cr in Sep-21 quarter while on a sequential basis, the profits were up by 1.68%. In terms of guidance, HCL Tech has guided for double-digit revenue growth in FY22 and operating margins have been projected in the 19% to 21% range. Its current OPM at 23.5% is at par with Infosys and a tad below TCS.

HCL Tech declared Rs10 interim dividends and this marks the 75th consecutive quarter of dividends.

The stock is currently trading at Rs1,228.65, down by Rs22.25 or 1.78% from its previous closing of Rs1,250.90 on the BSE. The scrip opened at Rs1,250.90 and has touched a high and low of Rs1,272 and Rs1,226.60 respectively.

HCL Technologies Ltd reported 11.08% growth in total revenues for the Sep-21 quarter on consolidated basis at Rs20,655cr. On a sequential basis, the revenues were higher by a more moderate 2.93% compared to Rs20,068cr in the Jun-21 quarter.

HCL Tech witness robust growth yoy in constant currency terms of above 13% in services revenues while the products and platforms business saw contraction of -5.5% in top line.

In terms of verticals, the IT and business services grew 13.2% yoy and 5.2% sequentially. This business accounted for 73% of total revenues and enjoyed an EBIT margin of 18.8%. The other vertical of Engineering and R&D services grew by 12.7% yoy and 5.4% sequentially. This segment reported 19.3% EBIT margins and accounted for 16% of total revenues.

During the quarter, HCL Tech had 14 large deal wins and the total contract value (TCV) of deals stood at $2.25 billion. That is a growth of 38% in TCV on a yoy basis. In terms of industry practices, life sciences & healthcare grew at 20.1% while the Telecom and manufacturing practice grew in the range of 12 to 13% on yoy basis.

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