HCL Technologies Ltd Management Discussions.

Industry Overview

In recent years, the role of technology has shifted from cost optimization and process automation to business model transformation and revenue growth. Global organizations are embracing digital transformation to achieve these more ambitious goals, developing and deploying digital solutions faster, more e3ciently and with better outcomes.

The COVID-19 pandemic has compressed the digital journey for many industries and organizations from years into months for various reasons. Breaking down silos, optimizing how teams work together using collaborative tools, engaging creatively across distributed ecosystems, delivering better services more e3ciently and cost-e3ectively, providing user-centric solutions, products, and services are just a few of the potential benefits driving companies’ digital journeys.

Such benefits make digital technology – in partnership with human ingenuity and resilience – what HCL calls "The New Essential". While technology sits at the core of a massive digital transformation that is underway, it o3ers global enterprises the most elegant path to long-term sustainability. Enterprises that emerge from the pandemic with their digital journeys underway will be more resilient and agile, equipped for a sustainable future in the new normal.

Analysts estimate that as much as a trillion dollars of incremental enterprise technology spend is likely in the next five years. Key themes driving technology investments include omnichannel client experience, zero touch operations, digital workplace and digital product engineering. Cloud consulting, deployment, and management services continue to represent opportunities as hybrid cloud adoption becomes even more pervasive. Rather than managing IT spend internally, clients are opting to open their traditional and incremental technology spend to partnership-led digital transformation. "The New Essential" adds a dimension of sustainable transformation. We strongly believe that values drive value and that sustainability goes way beyond the impact we can bring about within our organization. We will lead the narrative by crafting a vision for tomorrow for ourselves and our ecosystem of shareholders and stakeholders.

During the financial year, the technology industry has also stepped up to help the world manage a crisis of epic proportions. Sector participants have demonstrated and enabled resilience on a global scale, equipping organizations with the tools, resources, and services they need as they enter the recovery phase. HCL stands at the forefront of every one of these capabilities. With 40 years of proven ability to operationalize a future-proof strategy, it is well positioned to continue on an upward trajectory for decades to come.

Sustainability principles and actions are built into HCL’s strategy, culture, and day-to-day operations. Guided by the United Nations Sustainable Development Goals, the company views sustainability through three lenses: social, environmental and economic, referred to as People, Planet and Prosperity. For example, HCL aims to improve the lives of people, enabling employees, clients, stakeholders, and communities to play a significant role in poverty reduction and quality of life improvements. With an emphasis on improving standards of living, HCL focuses on health, education, technology, jobs, and people who are denied the benefit of, and access to, advances in science, technology, and innovation.

Environmental, Social and Corporate Governance Strategy

HCL strongly believes that values drive value and that its inherent purpose is to shape and strengthen the social, environmental, and economic future of the world and specifically of the communities where it operates. We take pride in combining the values we nurture and the value we deliver to all our stakeholders. The company’s historical and ongoing commitment to this belief and purpose stands at the core of its ESG strategy and actions. The focus on ESG has delivered strong value, allowing HCL to grow as an organization and build lasting and productive relationships with its employees, clients, and stakeholders. Today, there is a growing expectation from investors, employees, clients, non-governmental organizations (NGOs), and numerous other stakeholders to increase transparency with respect to sustainability and socially responsible practices through public reporting of ESG policies, initiatives and, most importantly, metrics. While ESG has always been up, front and center from a purpose and culture perspective for companies like HCL, it has become one of the key parameters in evaluating performance and reputation today.

To be meaningful from a business perspective, ESG programs must deploy quantifiable benchmarks to evaluate their own performance and the impact of their entire supply chain. Transparency in communicating our vision and our e3orts and progress in attaining our vision keeps us focused and accountable. HCL is committed to reporting its progress in all of the areas of ESG, these are available today in the company’s Business Responsibility Report. Being a signatory to the United Nations Global Compact, HCL’s commitments as well as its progress on key initiatives will be made public.

The cost of doing business should include both financial and non-financial metrics. As a socially responsible company, HCL is constantly monitoring and taking steps to address its impact on global warming and emissions while decarbonizing, as much as possible. It tracks and seeks to reduce the contribution the company makes to climate change through greenhouse gas emissions, its carbon footprint, while also adopting practices related to ethical waste management and energy e3ciency. HCL has always strongly integrated with the local communities it serves, in e3ect seeking their "social license" to operate as a good citizen and contribute positively to the overall wellbeing of the area. It has made significant contributions to address poverty and hunger through structured urban and rural development and education and health programs through the HCL Foundation, and diversity and inclusion through a combination of Human Resources policies and practices and its Employees First philosophy.

A well-defined, comprehensive corporate governance system defines a set of rights, rules, principles, responsibilities, and expectations between di3erent stakeholders. The system is then used to balance and align interests between stakeholders as the company pursues its long-term strategy. HCL prides itself on the overall transparency in its operations. It complies with the United Nations 10 Principles, but equally important, it articulates and showcases policies for industry stakeholders including anti-bribery and corruption, code of conduct, whistle-blower, corporate social responsibility, and remuneration policies.

The company takes pride in the fact that it has received a number of accolades that validate its commitment to ESG. These include recognition from global assessment platforms and investors, such as Sustainalytics, Dow Jones Index, FTSE4Good Index Series, UNGC GRI reporting, EcoVadis, and Institutional Shareholder Services (ISS), to name a few.

• HCL was awarded ISS’ highest governance quality score, the 1st decile. The score of 1st decile indicates higher quality and relatively lower governance risk. The score is derived after reviewing four key factors: board structure, shareholder rights, compensation, and audit and risk oversight.

• HCL was featured as one of the top 10 "Most Sustainable Companies" in India by BusinessWorld, based on an evaluation by Sustain Labs Paris of companies’ ESG aspects.

• HCL was awarded a 2021 ESG Industry Top Rated Badge by Sustainalytics. It was ranked 15th out of 167 companies in the subindustry IT consulting, or the 9th percentile, with an ESG Risk Rating score of 16.5 and ESG Rating score of 70.

• HCL received an "A" ranking by MSCI, positioning it among the top performers.

• Citi Research Report 2020 mentioned HCL as being among the companies with the highest ESG ratings (those enjoying BUY Ratings).

Corporate Social Responsibility

Corporate Social Responsibility has been a core part of HCL’s business strategy rallying our global employees under a common purpose and giving them opportunities to contribute and bring about positive change. The HCL Foundation, responsible for driving the company’s corporate social responsibility agenda, oversees a host of flagship programs and initiatives.

The Foundation’s aim is to help break the poverty cycle by building more resilient individuals and communities. Its long-term, sustainable programs are ensuring equitable development and opportunities, resulting in a lasting positive impact on people and the planet.

Through outcome-driven programs and initiatives, the Foundation has yielded remarkable results since its founding 10 years ago. For example, through a network of more than 187 partners, the Foundation has cumulatively invested more than 680 Crore, impacting 2.14 million lives in 21 states and three union territories. The Foundation’s green initiatives have helped to revitalize 52,000 acres of land, establish sustainable community governance, rejuvenate 82 water bodies, and ensure the protection and treatment of 18,000+ animals across rural and urban geographies. In the process, the Foundation has forged deep-seated relationships with communities that are often excluded from the development process.

Over the past year, the COVID-19 pandemic has had a profound impact on the way that the Foundation and other charitable organizations operate. As the global community acted with urgency to battle the pandemic and keep people safe, the Foundation deepened its commitment to its mission of addressing socio-economic and environmental challenges through a series of sustainable programs. Some select achievements from FY21 include rural and urban programs.

Rural Programs

Driven by a commitment to create socio-economically self-reliant villages, the Foundation, through two of its flagship programs, HCL Samuday and HCL Grant, is engaging with local communities to seed sustainable transformative models and solutions and develop a source code for rural transformation.

HCL Samuday made headway in Hardoi district in Uttar Pradesh through an immersive approach, drilling deep into the rural communities to build the assets and infrastructure needed to galvanize the community to take charge of its future. For example, in FY21:

• 4,628 students and 6,521+ neo-literates accessed and benefited from education initiatives, while an open educational resource (OER) portal for content distribution was launched across Uttar Pradesh for classes one through five

• 29,591 outpatient department (OPD) clinics and diagnostic services were made available through telemedicine and mobile health clinics

• Reliable electricity from 32 solar microgrids was made available to 3,600+ households and 68 government institutions in 41 villages

• 3,480+ households received access to toilets and 1,197 households were connected to piped drinking water

In its e3orts to drive sustainable development, HCL Grant supports NGOs involved in path-breaking work in three areas – environment, education and health. Every year, it awards a grant of 5 Crore (approximately USD 680,000) to a single NGO in each of the three categories, in support of three to five-year projects they are undertaking. Each of the six remaining HCL Grant finalist NGOs is awarded a grant of INR 25 lakhs (approximately USD 34,000) for a one-year project, making a total grant of 16.5 Crore (approximately $2.5M).

This year the three awardees and their projects were:

• SAAHAS ("courage" in Hindi). Sustainable waste management through community-owned rural resource recovery systems in four districts in Karnataka

• CRY (Child Rights and You). Breaking down traditional gender barriers and rebuilding the lives of Bedia girls in two districts of Madhya Pradesh

• IHAT(India Health Action Trust). Improving maternal, newborn, and child health outcomes in tribal areas

Urban Programs

HCL Foundation is spearheading a bold vision to create a future where cities embrace their most vulnerable citizens and services converge to o3er a life of dignity and self-respect. To this end, the Foundation is creating a source code for urban socio-economic and environmental development through its urban flagship programs, HCL Uday and Clean Noida.

HCL Uday leverages the scale of the government, the expertise of NGO partners, and the volunteering spirit of HCL employees to bridge the access gap and provide the city’s poorest residents with quality services. Working through integrated community development, HCL Uday’s convergent approach is creating a comprehensive and holistic model of urban development.

In FY21, despite the COVID-19 pandemic, HCL Uday continued to support and stand by the communities, helping to provide 450,000 people across 11 HCL Uday locations with comprehensive care and services, including early childhood care and development, education, skill development, health, water and sanitation. Further achievements included planting 183,062 saplings, rejuvenating 22 water bodies, and providing protection, care and treatment of 16,424 animals, as part of HCL’s Green Space Initiative.

Clean Noida represents HCL’s commitment to transform Noida into one of the cleanest cities in the world. The aim of the program, which is implemented in full partnership with the citizens of Noida and the Noida Development Authority, is to create awareness of suitable waste management practices and evolve structured, technology-driven systems and practices for e3cient management of waste in the city.

In FY21, program highlights include clearing 2,748 tons of legacy waste in urban villages, operationalizing end-to-end waste management processes in eight urban villages, strategically managing waste segregation by type and waste collection sites for 67,000 households, and creating 17,000 square feet of wall art across Noida city.


Your company’s CSR initiatives in India received numerous recognitions in FY21, including:

• Fabulous Global Smart Cities Leaders, at the 9th edition of the World CSR Day Congress and Awards, for Project Clean Noida

• Recognition by the Basic Directorate of Education, Government of Uttar Pradesh, for changing the horizon of the education ecosystem in Uttar Pradesh

• Global Humanitarian Award, presented by World Humanitarian Drive, for exemplary humanitarian response during the coronavirus pandemic

Your company’s unique blend of services and products enables clients to achieve transformation guided by the framework of the company’s Mode 1-2-3 strategy, its signature growth blueprint to ensure organizations accelerate their transition into digital enterprises. The Mode 1-2-3 strategy gives clients assurance and confidence in HCL’s ability to deliver on their vision of sustainable transformation.

HCL’s Mode 1 services aim to o3er global clients a leadership position and enhance the business competencies for their core business processes, products, and services through the highest level of reliability and consistency through maximum automation, e3cient delivery, and operational agility. They enable clients to become more e3cient and agile while helping them achieve competitive di3erentiation in their industry. Mode 1 leverages the current business and IT landscape by consolidating a firm’s existing core and unearthing new ways to enhance that core with new technologies. These service o3erings are comprised of applications, infrastructure, engineering and Research & Development, and Digital Process Operations.

HCL’s Mode 2 o3erings help enterprises take the next digital leap using insight-based, experience-centric, and outcome-based integrated services that leverage next-generation technologies. Mode 2 propositions are in the areas of digital transformation, data analytics, IoT, hybrid cloud migration and management, digital product engineering and cybersecurity, and they help clients build robust new-age capabilities and pivot to new business models.

Cloud is a critical part of your company’s Mode 2 o3erings. It is transforming from computing infrastructure to becoming the core of business. It is the new way of delivering infrastructure services, driving engineering, creating software, managing data, and democratizing access to technology. To paraphrase Gartner, "There can be no business strategy without cloud strategy". HCL’s Cloud Smart approach provides a mix of cloud choices that modern business strategy demands. HCL unlocks the growth opportunities through Cloud Smart leveraging the HCL Ecosystem Units dedicated to hyperscalers like Google, Microsoft, AWS, IBM/RedHat and tech leaders like Cisco, Dell, VMware, Intel, and SAP among others. The services o3ered under the Cloud Smart umbrella are a reflection of HCL’s ability to develop capabilities and execute services that are closely aligned with business needs – a fact recognized by clients, analysts, experts, and partners.

Mode 3 o3erings are based on a strategy of creating innovative intellectual property (IP) by leveraging an ecosystem model through strategic partnerships, carve-outs, and co-innovation programs. Through both internal and external IP creation, HCL’s Mode 3 o3erings help clients target specific next- generation opportunities with scalable and ready-to- deploy products and platforms that reduce the time to become future-ready. It addresses the various needs of enterprise clients in the area of technology and domain related intellectual properties. These intellectual properties also enable our Mode 1-2 portfolio by augmenting with automation and AI/ML built into our service propositions. A new addition to our Mode3 strategy is the establishment of a dedicated Industry Software Division. This unit will focus on building next-generation products in 5G/telecom, manufacturing, and enterprise AI.

Your company’s success is deep rooted in its ability to execute by bringing together a multidimensional team with end-to-end ownership of client business problems. HCL di3erentiates itself from other technology consulting organizations through its people, unique culture, tradition of innovation, focus on outcomes, and an IP-led (via proprietary technology) approach. It goes beyond the traditional delivery model, leveraging an extensive partner ecosystem – from hyper-scalers to vertical platforms, from start-up incubators to boutique industry consultants – across the entire value chain to solve client business problems. The company has created an e3cient "onshore-o3shore-nearshore-anyshore" model to design exceptional talent management and training programs; even as talent goes remote, it’s accessible to the entire world on a video conference. In the anywhere, anytime world of service delivery, HCL continues to invest in data security and governance as cyber protection and data privacy becomes ever more critical in the post pandemic era.

HCL’s human resource teams focus on diversity and inclusion throughout the employee lifecycle, from recruitment through to retention. Its talent strategy, strong employee engagement mechanism, training and re-skilling of employees, robust performance review system, and recognition of top performers helps HCL minimize employee turnover and attrition across the organization. As a testament to HCL’s people management practices, Forbes ranked your company No. 30 globally on its list of the World’s Best Employers 2020 and No. 1 across multinational companies headquartered in India.

HCL continues to build on its market-leading localization rate – the percentage of employees hired locally – and will strive to lead the market in the next decade as well. This is supported by initiatives such as New Vistas, which helps to create a steady and stable supply of local talent in the medium term by diversifying HCL’s global delivery capabilities. Establishing "near to client, in-time zone" delivery centers ensures that ready-to-deploy, trained resources are available for client engagements.

An aggressive talent identification and career management plan focuses on hiring entry level college and school graduates (TechBees, as they are known at HCL) from the local academic institutions and grooming them. Cost e3ciency through various initiatives like automation, talent localization, global delivery diversification and entry-level hiring and grooming on a sustained basis play an integral part in sustaining margins. HCL has been increasing its presence in client geographies to improve delivery agility and reduce work-visa dependency.

The company optimizes its direct and indirect costs by maintaining a good balance of the onsite-o3shore mix and pyramid optimization within its teams. HCL maintains analytical tracking of various cost levers to ensure outcomes can be achieved through business process transformation. Productivity-related metrics are regularly monitored by intervention of levers such as utilization and automation. A strong cost-control mechanism has also helped to achieve non-linearity in growth in various areas of execution.

As a global organization, your company is poised to make huge strides in the technological landscape. Its balanced portfolio mix helps maintain business continuity and momentum in both the top and bottom lines. During the COVID-19 crisis, HCL followed its hallmark philosophy of "going beyond the contract" to help clients in every sector as they worked toward recovery and stability – an approach much appreciated by clients.

Business Segments

Your company’s Mode 1-2-3 strategy was well positioned to respond to the uncertainty of the last 12 months. Mode 1-2-3 was put to the test by the global pandemic. It proved itself to be a strong pillar for clients, one that supported their response to the global crisis by enabling them to step up digital transformation initiatives and migrate from traditional to digital technology on accelerated "pandemic time". Mode 1-2-3 allowed HCL to quickly respond to its clients’ business needs as they rapidly shifted their investments to digital channels, hybrid cloud, autonomics, next-generation network services, and intelligent and adaptive cybersecurity.

HCL’s success also resulted from its laser-like focus on three things – employees, execution, and value-centric delivery. Together, these opened the door to new and emerging business opportunities. Capitalizing on its next-generation technology portfolio – consisting of cloud, digital and analytics, Internet of Things (IoT), cloud native, artificial intelligence (AI) and automation, and cybersecurity – it successfully boosted engagements with new and existing clients.

HCL’s three business segments – IT and Business Services, Engineering and R&D Services, and Products & Platforms – were also instrumental in helping the company keep pace with digital demand, maintain forward momentum, and sustain an upward business trajectory.

IT and Business Services (ITBS): The ITBS segment comprises three sets of services that reflect crucial building blocks of every enterprise adopting next-generation technologies:

• Digital foundation: hybrid cloud, digital workplace, next-generation network, and cybersecurity/ governance, risk and compliance (GRC) services

• Digital business: consulting, applications and platforms, insights (data and analytics), and IoT services

• Digital operations: Integrated IT operations, security operations, and process operations

The disruptive forces created by the coronavirus pandemic heightened the urgency to leverage these three blocks. But in a post-pandemic environment, demand in these three core areas will continue to climb, as global organizations strive to increase business resilience, improve operational e3ciency, enrich and deepen customer engagement, and innovate operating models.

In each of the three areas, HCL has proven proficiency and expertise supported by deep investments in talent, innovation labs, experience centers, centers of excellence, and world-class partnerships. By capitalizing on the synergies among the three, HCL o3ers an integrated set of capabilities that delivers greater value than the sum of the individual services.

Engineering and R&D Services (ERS): With ERS, HCL showcases its deep engineering roots and competence through its ability to accelerate digital product development for clients across engineering, manufacturing, supply chain, and services. ERS leverages more than 50 solution accelerators and next-generation technologies such as IoT, AI, augmented reality and virtual reality (AR/VR), and autonomous vehicles. Leveraging the experience gained working with more than 330 businesses, ERS has helped clients to bring more than 1,000 products to market successfully.

Products & Platforms (P&P): Over the years, HCL has created thousands of solutions for clients, resulting in valuable intellectual property (IP), and products and platforms that provide quantifiable client value spanning traditional, emerging, and future technology needs. P&P, comprising businesses including HCL Software, DRYiCETM Software, Actian, and Industry Software Division of HCL Technologies, boasts more than 500 product releases and targets Mode 3 revenue. The P&P business unit represents a fundamental di3erentiator for HCL.

In combination, ITBS, ERS, and P&P enable HCL to deliver a comprehensive range of capabilities that fulfil the traditional, transformational, and future needs of clients across the globe.

A comprehensive suite of end-to-end digital o3erings to address the traditional & transformational needs of the resilient digital enterprise.

Digital Foundation

Through 2020, digital experiences have dominated the way people live and transact. With the trend of remote working, advanced technologies, including automation, AI, real-time analytics, agile operations and adaptive security, are being leveraged for collaboration, enhanced consumer experiences and to secure digital assets. This has been aided by cloud technologies that provide companies with limitless scope to maneuver, innovate, scale and grow.

With the e3ective use of digital technologies, companies can understand their customers better and adapt rapidly to provide compelling experiences that leave a lasting impact, even in the face of rapidly changing market dynamics.

HCL’s Digital Foundation o3erings help businesses adopt digital technologies which are at the core of business transformation. These o3erings are a combination of traditional infrastructure services and next-generation services around hybrid cloud, digital workplace, software defined networking, cybersecurity, and intelligent operations. Clients have used these services to develop long-term, enterprise-wide digital transformations to address future uncertainty and challenges. HCL is uniquely positioned to help enterprises extract maximum business value from their digital investments.

As a partner in their digital journeys, HCL works with clients to build a strong foundation, strengthened by extreme automation and agile delivery. With the help of HCL partnerships and strategic alliances with global technology vendors and niche solution providers – including AWS, Cisco, Dell, Google, IBM, Microsoft, SAP, Arista, Citrix, Cohesity, Docker, HPI, HPE, Intel, NetApp, Nutanix, Pure Storage, Rubrik, and VMware – the company’s clients are transforming and powering their business.

Within the context of Digital Foundation, HCL o3ers an array of products and services leveraging next-generation technologies.

Hybrid Cloud Services

Profound changes dominate the way businesses operate. Organizations are adopting hybrid cloud services to reinvent themselves and stay relevant in a technology-driven market. Cloud has become a strategic pillar to build a responsive, scalable, and resilient business. It has also become the primary accelerator for business transformation – delivering growth, agility, and experience to customers, partners, and employees.

Businesses are also realizing that merely acquiring cloud technology is not enough. Cloud technology must be deployed in ways that generate tangible business value. HCL works with clients to help them rethink how the cloud is designed and consumed via the adoption of an enterprise-wide cloud strategy to ensure maximum returns while smartly avoiding the inherent complexities and choices arising with its adoption.

HCL’s Cloud Smart approach is designed for enterprises that want to build adaptive portfolios with innovative cloud services, driven by intelligent automation, and a comprehensive partner ecosystem to address specific business objectives. HCL’s cloud practice, in the form of Cloud Smart, is poised to present the mix of intelligent cloud choices that clients need. This is in keeping with HCL’s rich history of delivering smart solutions that facilitate growth. Overall, HCL’s hybrid cloud service is an ideal route for clients wanting to build a resilient digital enterprise of the future.

Digital Workplace Services

HCL’s Digital Workplace Services o3ering addresses all business-to-employee (B2E) needs. It aims to create digitized workplaces for clients by transforming traditional workplaces into dynamic and intuitive business-enabling workplaces with a focus on personalized user experience, user-machine collaboration, adaptive workplace security, and employee wellbeing. Digital Workplace Service delivers a boundary-less workplace without compromising on-time and on-demand provisioning.

The goal of this B2E service is to boost employee engagement and productivity through automation and AI-driven solutions. HCL’s Fluid Workplace solution combines people and culture with technology to address the composite needs that have arisen with the convergence of IT, human resources, administration, and facilities management. It enables the end users, the IT function. and business to be productive by being:

• Future-ready: agile workplaces that keep up with business

• Liberating: ergonomic, safety, and wellbeing focused workplaces

• User-centric: design-thinking led and hyper-personalized

• Intelligent and immersive: ambient and progressive technology fabric

• Democratized: fosters diversity and empowers everyone equally

Next-Generation Network Services

Modern enterprises need advanced networks that are open yet secure, agile yet scalable, easy to govern, and yet support quick real-time changes.

HCL o3ers clients an extensive network portfolio encompassing strategy, design, and implementation across transformative technologies including software- defined-WAN, access, and data center. HCL’s IP frameworks for network automation and orchestration are used by clients to automate their network lifecycle and future-proof their network ecosystem. HCL adopts industry best practices across its solutions and services, setting competitive benchmarks in engineering excellence, innovation, operational expertise, and delivery capabilities. HCL manages networks for more than 250 clients globally. Clients include global services providers, OEMs, and Fortune 500 companies.

Cybersecurity and GRC Services

Enterprise cybersecurity needs are continually evolving. With cloud and digital adoption, cyberattacks have become increasingly sophisticated and more frequent. With Industry 4.0 initiatives like the automation of traditional manufacturing, stringent regulations, and dependence on supply chain partners, mitigating cybersecurity risks has become highly challenging across the widening cyber-physical estate. The existing skills scarcity, coupled with the rapid ramp up of distributed workforces, and global digital value chains further exacerbated by the COVID-19 pandemic, has exposed organizations of every size and sector to additional risks.

These challenges create new opportunities to scale up security o3erings. Such o3erings include real-time compliance monitoring and measurement, and accelerated execution of critical projects like Zero Trust, software defined security (SDS), secure access service Edge (SASE), decentralization of identities, and software defined perimeter (SDP). IoT-related imperatives are also creating the need for a security layer on top of identity management systems.

HCL’s vision is to provide dynamic cybersecurity to address an evolving and constantly changing threat landscape. HCL’s Dynamic Cybersecurity Framework enables protection against threats by enforcing end-to-end coverage and creating a dynamic enterprise security posture that includes a technology and tool independent architecture, a unified, well-integrated next-generation technology and process control, strong governance of identity, data and third parties, the ability to predict and detect vulnerabilities, and the ability to respond and recover quickly.

Clients are choosing HCL as a partner because it provide reliable, end-to-end ownership of the security lifecycle from strategy, consulting, architecture, proof of concept, implementation, and transformation to integration. It enables organizations to select and implement the most cost-e3ective and right-fit solution / technology for their business. It o3ers enterprise scale solutions and proprietary solutions that include SecIntAl (AI-enabled security detection and incident response (IR) services) and SAFE (security architecture framework for enterprises). Altogether, HCL provides clients with a robust "static to dynamic" cybersecurity posture.

Digital Business

Enterprises across industries have been investing in digital transformation to reimagine their business models, deliver unique experiences, and improve e3ciencies. Business agility, ability to change, and technology adoption are now central to the new normal. The current climate has generated another year of robust growth in FY21 for HCL, led by its Mode 2 digital and analytics services. The three prevailing trends in the market are fast adoption of public cloud IaaS and SaaS, enterprise reorganizations shifting away from traditional IT-business operating models to agile IT operating models, and hyper demand for application modernization and data analytics.

HCL’s di3erentiation in each of these areas has helped it win modernization deals with existing and new clients.

Moving into FY22, the company has created a single global digital business, combining digital consulting, application services (Mode 1 and Mode 2), and data analytics services. Together, they accelerate digital transformation initiatives undertaken by clients, enabling HCL to secure large application services and data analytics engagements that require the combined capabilities of legacy support with digital consulting, application and data value stream modernization.

HCL has rapidly scaled capabilities using key partnerships for cloud with Google Cloud Platform, Microsoft Azure and AWS, and critical application and data platform partnerships with Salesforce, SAP, Oracle, Snowflake, Pega, and Alteryx.

Digital Consulting

People sit at the center of the digital world. To succeed in that world, businesses must focus on technology and the user who leverages that technology to interact with business processes. As a result, value chains (business processes) across industries are being reimagined with user experience at the core. In this setting, clients regard HCL’s ability to provide multidisciplinary teams to deliver in an agile product-centric model as a critical di3erentiator.

HCL Digital Consulting services include:

• Experienced strategy and design to develop enterprise-wide experiences that speak to the unmet needs of clients, employees, and users

• Industry capability definition and business process optimization aimed at improving performance and top line growth by identifying and defining di3erentiated capabilities

• Agile delivery transformation through agile operating models that align delivery ecosystems to the performance among customers, capabilities and features

• Organizational agility to create and execute customized plans that ensure employees have the right level of support, leadership and coaching for change

Applications and Platforms

Enterprises are continuing their shift toward new operating models, leaving behind function-based silos for value chain-centric and product-centric operations. The technology that supports these operations is also being transformed. Enterprises are redefining business architecture to increase agility and scalability by adopting modern applications, SaaS, composability, and by creating platforms to deliver business.

Your company is a top tier partner with leading enterprise applications and SaaS companies including SAP, Salesforce, and Microsoft. Similarly, HCL has deep expertise and solution partnerships with integration and low-code providers such as MuleSoft, Pega, Workato, and Appian. HCL also maintains strategic partnerships with marketing platform technology providers such as Adobe and Sitecore.

Last year’s Annual Report noted significant traction with solutions in the SaaS-based customer relationship management (CRM), human capital management (HCM) and supply chain management (SCM) arenas, with the expectation that the trend would likely continue. Indeed, the COVID-19 pandemic has accelerated digital transformation, turbocharging the digitization process and cutting years o3 the timeline.

In line with how enterprises have scaled their agile IT operating models, HCL has re-architected the way it delivers its application support and managed (ASM) services, combining DevSecOps and scale agile capabilities to create ASM 2.0. The approach defines roadmaps for clients based on the velocity of change in application landscapes to adopt a scale agile model. HCL is working with more than 100 global 1,000 clients to support and modernize their applications.

Data and Analytics

Enterprises are becoming data intensive and data driven. Data itself is being treated as a value stream, leading to growing investments in modernizing data platforms, building scalable data architecture, and leveraging cloud partners such as GCP, Azure, and AWS. In tandem, there is a strong focus on data security, data governance, and data management. Together, they are helping data analytics quickly evolve from delivering insights to being core to value chain reinvention. Thus, the organizational flow of value has become synonymous with the organizational flow of data.

HCL’s approach to the related services consists of four key pillars:

1. Adaptive data platform: A data-first approach to transform existing data platforms into a future-ready and responsive data platform capable of delivering real-time intelligence.

2. Intelligent data management: Decouples the underlying storage ecosystem from data management aspects and focuses on ethical data governance, self-healing data quality, universal metadata management, automated data lifecycle management, and master data management.

3. Consumption-based analytics: Enables delivery of democratized insights through an organized catalog of all data and analytics assets to promote collaboration, reuse, self-service infusing predictability, and transparency in analytics services.

4. Applied AI: Delivers AI solutions driven by human centricity, design thinking, and experimentation at scale.

HCL’s strategic partner network further bolsters its advanced data analytics and data science capabilities. The new partnership scales the company’s competency to help enterprises adopt advanced self-service analytics and process automation for faster, more agile service and innovation implementations.


Enterprises are moving toward connected ecosystems with the mainstream adoption of IoT. They are also diversifying their portfolios from products and traditional after-market services to digitally enabled services driven by artificial intelligence/machine learning/deep learning (AI/ML/DL) to drive new revenue streams and enable outcome-driven models. Pressure to adapt to the global pandemic quickly has accelerated digital transformation journeys, creating innumerable opportunities. As a result, the traction across verticals for specific needs – such as AR/VR for remote field service and training, remote monitoring of patients through connected wearables and extended reality (XR) technologies, and real-time insights enabled by AI/ML–is gaining speed.

HCL’s IoT WoRKSTM is well-positioned to address this tremendous opportunity by addressing clients’ end-to- end needs for "define, build and run" services in the connected ecosystem. This is supported by a robust portfolio of 50+ products and solutions across industries. These productized solutions take an integrated service approach of providing seamless orchestration of things, data, platform, process and people to create enhanced user experiences, improved operational e3ciency and a measurable market di3erentiation. Investments in two IoT CoLLABsTM, in Redmond, WA (U.S) and Noida, bring together best-of-breed ideas, tools, technologies, and resources from a diverse set of technology, consulting, and platform partners to create a scalable prototype in a short time frame. The goal is to accelerate the idea-to-market journey. A proven 3-3-3 Innovation by Design consulting framework enables clients with a structured approach to ideation, building prototypes, and determining the scalability and commercial potential for their solutions. With its end-to-end orchestration capabilities of the IoT stack, a strong product engineering pedigree, domain expertise, a robust partner ecosystem, and high customer satisfaction, IoT WoRKSTM has been continuously rated as "Leader" by analyst firms and has become a partner of choice for clients across industries such as manufacturing, life sciences and healthcare, and energy and utilities.

Digital Operations

Changing customer expectations are pressuring operations. Traditionally, operations comprising processes, management practices, and capabilities have streamlined business performance. Now, orchestration of processes through digitization is creating new levels of scalability and an experience-centric operations ecosystem. It is evident that digitizing operations can facilitate vast improvements in operational capabilities. HCL’s digital operations o3erings, with the building blocks of integrated IT operations (IITOPS), Cyber Security Fusion Centers (CSFC), and process operations, are designed to provide next-generation digital services that enterprises can use to achieve resilience and flexibility.

Autonomics and Unified Service Management

As global enterprises continue to deploy smart machines and simplify their operating processes, a key focus area will be IT management. With the proliferation of smart devices, an expanding remote workforce, and evolving enterprise needs, the pressure on IT teams is reaching a breaking point. Sustainable IT practices that are contingency proof and not fully reliant on human intervention are emerging as a competitive di3erentiator. That is precisely what AI promises to do in the form of AI operations (AI Ops).

Service management has expanded beyond IT. Unified service management (USM) solutions extend IT service management (ITSM) capabilities to address business-centric use cases, such as facilities, HR, and customer service, managing service demand and supply. It is inevitable that USM solutions intersect with organizational capabilities, such as enterprise resource planning (ERP), customer relationship planning, business process management (BPM), and robotic process automation (RPA). USM’s interplay with these will drive business technology management strategies over the next decade.

Autonomics and unified service management will play a critical role in creating sustainable and agile IT ecosystems that are prepared for contingencies as new-age enterprises expedite their digital transformation initiatives in the post-pandemic world.

Integrated IT Operations

Integrated IT Ops (IITOPS) is a new hybrid operating model. Based on the pillars of the AI Ops approach, cross-skilled teams, operations best practices and cultural transformation, it provides a combined approach of classic (ICC, DCOps, AppOps, NetOps) and evolving (CloudOps, DevSecOps, SRE/PRE, and FinOps) operations models. IITOPS leverages a common foundational approach of autonomics and USM across ITIL/IT4IT/SAFe agile models. HCL brings pragmatic automation solutions through DRYiCETM iAutomate, DRYiCETM NetBot, HCL Software’s Automation Power Suite, and simplified processes to drive extreme e3ciency and agility into IT operations.

HCL partners with the world’s leading ISVs to deliver continuous service assurance for clients’ digital transformation. Key strategic partnerships include Moogsoft, Dynatrace, Splunk, AppDynamics, Broadcom, Zenoss, which supplement the company’s HCL Software and DRYiCETM software divisions.

Security Operations

HCL’s security o3erings are well placed to e3ectively meet the most complex needs of global clients. Cybersecurity plays a pivotal role in enabling organizations to become resilient, secure, and ready for the ever-changing threat landscape. HCL’s Cybersecurity Fusion Centers (CSFC) further strengthen the company’s commitment to defending customers’ digital assets. CSFCs are state-of-the-art security operations and response facilities, integrating multi-domain security teams, processes and cutting-edge analytics, enabling organizations to detect threats faster and resolve incidents e3ciently. Each of the global CSFCs provides 24/7 cyber operations services with more than 60 billion security events tracked daily. The CSFCs, built on HCL’s SecIntAI framework, help integrate di3erent components of cyber operations to operationalize a comprehensive cybersecurity lifecycle delivered via the company’s Fusion Platform.

HCL’s CSFC Fusion Platform ingests the telemetry collected from the entire IT stack to deliver proactive threat monitoring and comprehensive protection. This helps the security teams share information and collaborate closely with clients, and heighten their operational security posture so that they are better prepared for any eventual incident. Through a combination of an expert team and two decades of mature security process automation, the CSFCs help HCL customers detect and respond to security threats swiftly and protect and manage their security technologies comprehensively. HCL has six CSFCs strategically located in Texas (U.S), Gothenburg (Sweden), Noida, Bangalore, and Chennai (India); a seventh CSFC is set to launch soon in Melbourne (Australia).

Process Operations

The COVID-19 pandemic has triggered fundamental changes in the business models of various industries, characterized by new avenues of customer engagement, supply chain resilience, adjacent products/services, alternate fulfillment models, and remote workforce management. This requires agile operations to quickly adapt processes, systems, controls, and customer journeys to evolving business requirements. As a consequence, organizations are betting big on technology-led operations, digital transformation, agile operating models, innovative deal constructs, virtualization of work, and a globalized talent pool.

HCL’s Digital Process Operations (DPO) was quick to respond with an integrated "process first, technology-led digital operations" model, which re-imagines client operations across three broad stacks – the process tier, the technology tier, and the consumption tier. These stacks determine the velocity and magnitude of business success an organization achieves. The process layer sits in the middle stack, enabling process transformation using HCL’s proprietary process engineering, golden process blueprints, and orchestration tools. The technology layer, focusing on e3ciency and scale, lies at the bottom, leveraging the underlying technology/platform landscape enabled by autonomics. The consumption layer forms the top of the stack, focusing on business outcomes and improvements through omnichannel, smart, and digital interactions.

Your company’s DPO strength is rooted in its proven capability around future-ready engagement models and fully vested for business-linked commercial constructs. The company’s custom-created target operating model adopts the right balance of control, cost, flexibility and risk, leveraging DPO experience of industrialized shared services, geo- rebalancing/right shoring, risk management and controls, governance, and continuous improvement. Breadth of experience enables HCL to underwrite integrated service level agreements (SLAs) and business outcomes, commit to underwriting savings cases and provide the ability to bring complete variability in spend. With extensive expertise across rebadging talent pools, workforce diversity in a hybrid location model, digital skills academy and flexible employment arrangements, DPO has successfully enabled a highly di3erentiated and distributed workforce globally.

DPO provides services to more than 100 clients across industries that include Fortune 500 and Global 2000 organizations. With state-of-the-art delivery centers across India, Europe, Ireland, Latin America, the Philippines, the United States and the United Kingdom, DPO leverages its integrated global delivery model (IGDM) to provide clients with best-in-class services.

The COVID-19 pandemic has shrunk global output, challenging enterprises to contend with supply-chain disruption, data security imperatives, and evolving workforce models. However, against a backdrop of change and uncertainty, the global engineering services and technology sector rallied in the second half of 2020 on the back of its rapid acceleration in digital transformation.

Enterprises aiming for leaner structures with more flexibility, faster adoption of cloud-based products and services and new business development opportunities, are likely to trigger a recovery in core sectors such as automotive and manufacturing. In 2021, commercially driven verticals including Medical Devices, Software and Internet, and Consumer High-Tech, will emerge as growth markets, generating additional demand for HCL’s Engineering and R&D services.

HCL’s ERS practice is amongst the most valued global engineering service providers (ESPs). With more than four decades of experience in operating under complex multi-vendor environments and client value chains, it possesses the capacity and know-how to seamlessly integrate with, and complement, the product engineering and research and development (ER&D) e3orts of clients.

HCL clients include leaders across several asset-heavy engineering industries, such as Aerospace and Defense, Automotive, Industrial Manufacturing, Medical Devices and O3ce Automation, and asset-light industries, such as Telecommunications, Consumer High-Tech, Semiconductor, and Software & Internet.

HCL accelerates development across the entire product ecosystem, encompassing engineering, manufacturing, and services. HCL helps clients improve time-to-profit by maximizing return-on-innovation. It is highly regarded as a thought leader in digital engineering technologies and o3ers its clients:

• Technological depth with new-age digital technologies such as IoT, AI, AR/VR, plus solutions and technologies for autonomous vehicles

• A solutions-driven approach across automation, analytics, platform, and sustenance with patents, including patents on IP-based solutions

• World-class infrastructure and labs for product engineering and testing

ERS has a strong innovation culture, resulting in IP and strategic innovations while leveraging alliances, start-ups, and key academic research for co-creation with clients. HCL is investing heavily in developing solutions that help clients quickly influence the overall product ecosystem. Investments in more than 100 engineering labs (environmental compliance, certification, and benchmarking), more than 100 client development centres and Centres of Excellence (in niche areas such as industrial design, high-performance computing, automation, imaging, big data and analytics, and others) have resulted in a complete ecosystem of comprehensive digital engineering services from concept to market for client products & platforms across domains.

We provide end-to-end Engineering Services across Product Engineering, Platform Engineering, and Operational Technology Services.

Product Engineering

We combine deep domain and technology expertise to provide our customers with Product Lifecycle services for existing and new products – solutions designed for the connected world and which help our customers tap the full potential of their product portfolios.

Platform Engineering

HCL’s end-to-end Platform Engineering services help our customers in achieving the best value from their engineering investments in building, running, and maintaining their high-performance, secure, and highly scalable platforms. We support our customers at di3erent stages of their digital transformation journey, from building to continuously improving their digital platforms and services using the latest technology.

Operational Technologies

HCL’s Operational Technology services are aligned to address key industry requirements – right from e3ectively translating design intent from virtual world to manufacturing floor, simulation and optimization of complex manufacturing processes, concurrent engineering to compress time, improve productivity and flexibility to handle variance and volume.

Digital Engineering

HCL’s Digital Engineering Services cater to the full spectrum of digital transformation from defining to realizing digital strategy and roadmap. HCL ERS has developed many service accelerators to facilitate the adoption of next-gen technologies like IoT/IIoT, Cloud, AI/ML, AR/VR, 5G, Digital Twin/Thread, and emerging areas like High-Performance Computing, Edge Computing, Industry 4.0, etc.

HCL Engineering Services span the entire spectrum of product and platform go-to-market across New Product Development, Software Product Engineering, Collaboration Services, Data Engineering, Network Engineering, Connected Experiences. This helps us optimize time-to-monetize and accelerate go-to-market for our customers.

Key digital themes such as product and platform engineering, design thinking, connected ecosystem, as-a-Service models, and Industry 4.0 are becoming pervasive across the industry spectrum. Enterprises are investing heavily in new-age digital engineering technologies such as 5G, Cloud, AI/ML, AR/VR, Internet of Things (IoT), and Blockchain. Businesses realize that the investments made today in digitalized products that are personalized, intelligent, connected and cloudified, and in digitalized processes that use automation, simulation, traceability, and AI will deliver big dividends down the line. The result has been a growing demand across industries for strategic engineering service providers like HCL.

The accelerated demand for digital engineering has led to the development of HCL’s next-generation services. These will continue to be a key growth driver for HCL in FY22 as it focuses on 5G, Industry 4.0, data engineering, and platform engineering. The company will continue to capitalize on the digital wave, focusing on key industries, and leveraging innovative IP-led partnerships as the core tenets of a buoyant growth strategy.

With the trend of large-scale digital transformation, HCL sees a growing demand for engineering services outsourcing as organizations look for strategic partnerships with ESPs to provide critical solutions and services such as:

• In-depth domain-centric product engineering solutions

• Robust engineering talent and collaboration with start-up and global capability centres (GCC) ecosystem

• Capability to execute large, complex, end-to-end engineering programs

• Intellectual property creation and carve-outs

HCL is poised to take advantage of the digital engineering led ERS growth. The company’s strong and long-standing relationship with 65 of the top 100 companies worldwide that spend the most on R&D helps it to remain the strategic partner supporting their digital initiatives. HCL’s commitment to sharing ownership and engineering responsibility for product and platform development fully complements its clients’ ambitions.

Products & Platforms (P&P) business is thriving and now accounts for a significant portion of your company’s Mode 3 revenue. Three factors driving P&P growth are:

• Enterprises are equally concerned about applications and the IT infrastructure on which their applications run

• Having seen good results with HCL’s management of their infrastructure, clients are trusting HCL with their applications, giving the company latitude to play in a $400B global enterprise software market

• HCL’s product engineering DNA has already helped create thousands of products for clients, and P&P brings this rich engineering experience under one roof

Clients can now expect HCL to meet their needs around end user computing, collaboration, enterprise applications, development and testing, virtualization management, hardware management, security and service management through its umbrella P&P business. The demand for P&P expertise from clients has been steadily growing and HCL has met this demand through a series of in-house innovations, development, acquisitions, and strategic partnerships. Clients can now take advantage of the company’s IP-led o3erings and expertise around automation, e-commerce, digital solutions, data management, mainframes, Secure DevOps, multi-cloud support, AIOps, service orchestration, and business flow intelligence. Each of these o3erings has an uncompromising customer-focus, quick time-to-value, and clear roadmaps. Comprising HCL Software, DRYiCETM, Industry Software Division of HCL Technologies, and Actian – P&P is the go-to answer for clients that have developed a high level of comfort with HCL’s consulting, management, and integration services over the years.

HCL Software Division

Despite the coronavirus pandemic, FY21 was highly successful for HCL Software. The pandemic underlined the importance of clients’ IT infrastructure – and the mission-critical enterprise software running their businesses. From customer-facing applications such as HCL Commerce (that transacts sales orders) and HCL DX (that supports business-critical digital experiences) to development platforms like Domino (that runs 10 million applications at 15,000 organizations) and security software like AppScan and BigFix, along with many other critical products in HCL’s portfolio, HCL serves as the backbone to the world’s most successful organizations.

For example, when people have been sheltered at home, and online commerce becomes the primary channel of business, it is HCL Commerce that has helped several B2C and B2B companies thrive. Under immense pressure to perform in demanding conditions, HCL Commerce has proven itself to be among the most scalable and reliable e-commerce platforms. Similarly, when people have to work from home, BigFix endpoint management secures corporate devices, protecting them from data loss and corruption.

HCL expects to see similar dynamics play out in FY22 and beyond. The critical importance of clients’ IT infrastructure will continue to magnify the need for more agile, resilient, and optimized operating models. An expansive install base provides tremendous scope to introduce clients to di3erent parts of the HCL portfolio.

As clients achieve greater success leveraging additional products and solutions, even more opportunities to improve and enrich the client journey will emerge. HCL will rise to the challenge, continuing to help clients navigate the road to recovery by working at pace, attracting and retaining talented professionals, and continuing to make strategic investment choices while anticipating, and staying ahead of client demand.

Since HCL Software’s inception, its ambition and vision has been to become a top 10 enterprise software vendor. It aims to bring enduring value to clients’ mission-critical IT investments and drive new capabilities through sustained innovation. Its operating model follows principles that guide the business toward success, placing clients at the heart of every action. These principles include enduring value, client success, pragmatic innovations, market leadership, employee-first, cloud native, and trust and security in every decision made.

Investing and improving its products is the cornerstone of HCL Software. In FY21, it announced 22 major product releases and nearly 400 product releases overall. It delivered 10 new modules within its products and more than 1,000 enhancements. More than 85 percent of HCL’s products, initially conceived as tried-and-true on-premise products, are now cloud-native with a robust pipeline of further cloud native products already set for release this year. With 21 new patents filed, the culture of innovation underpins the business’s ability to help clients fully leverage technology for good.

Cloud native and API first are the foundations of HCL’s architectural modernization strategy, providing the ability to rapidly innovate new capabilities and components around them. The company plans to introduce new products and services around cloud native that will o3er clients flexibility, speed, and cost savings in the management and ownership of their IT infrastructure.

Clients have partnered with HCL Software primarily due to the investments and innovations put into its products. There have been numerous new releases and enhancements delivered already, many of which were developed for, and in collaboration with, clients. HCL clients contribute directly to the product roadmaps; their input and feedback is vital to sustaining long-lasting relationships with the clients that invest in these products.

Your company’s success in the past year – measured by the sales transactions across 15,000 unique customers and onboarding 1,500 new business partners – is linked to HCL clients finding the company easy to work with as a partner and a pricing model that is simple and transparent. HCL’s tech support team is world class and has resolved more than 400,000 client cases. Helping clients succeed is HCL’s ultimate goal, which is reflected in HCL’s Net Promoter Score (NPS) improving by more than 70 percent in the last year.

DRYiCETM Software Division

DRYiCETM Software, established in 2018, is HCL’s foray into the emerging world of artificial intelligence (AI), automation, and business observability. AI and automation will be the key elements of a digital enterprise. DRYiCETM brings these enterprise initiatives to life and currently develops and sells more than a dozen products and platforms in AI Ops, service orchestration, and business observability.

HCL operates in some of the fastest-growing market segments, including AI Ops, at 37 percent compound annual growth rate (CAGR); enterprise service orchestration, at 20 percent CAGR; and operational intelligence, at 31 percent CAGR. DRYiCETM Software, since inception, has grown threefold with a global base of more than 250 customers. HCL’s AI Ops product portfolio continues to outpace the market, growing at more than 40 percent CAGR. The growth is led by iAutomate (AI-powered runbook automation), Lucy (industry leading cognitive virtual assistant) and MTaaS (an industry only managed Tools-as-a-Service o3ering). The iControl software catering to the operational intelligence market grew 50 percent year over year (YoY) given the high demand in the enterprise market to drive real time business observability.

Your company continues to invest in its products, catering to the fast-changing markets in which it operates. In FY21, DRYiCETM had more than 25 successful product releases and more than 100 product enhancements. The company takes pride in the fact that its products continue to make a di3erence in how enterprises adopt AI at scale.

Industry Software Division of HCL Technologies

Connectivity, data, and automated decision making are revolutionizing industries. Telecom operators are transforming business by leveraging cloud to build a scalable, cost-e3cient network infrastructure. The convergence of cloud, hyperscale data centers, Edge computing, and mobile network technologies is driving a revolution in the way telecommunication services are delivered.

Within enterprises, AI and ML technologies enable functional groups to deliver superior experiences to stakeholders and customers using cognitive search and augmented analytics. Additionally, manufacturing is being reinvented as new analysis and optimization capabilities reduce the time-to-market and cost of building new products.

As part of HCL’s Mode 3 strategy for investing in products and platforms, Industry Software Division of HCL Technologies is chartered with building next-generation products in 5G/telecom, manufacturing, and enterprise AI. Over the last year, it has assembled a world-class team across engineering, product management, sales, marketing, and customer support with the mandate to bring innovative products to market.

As part of the telecom/5G portfolio, Industry Software Division of HCL Technologies has products for self-organizing networks (SON), device management, network function virtualization (NFV) acceleration and modem IP for front/mid/backhaul of 5G tra3c. It serves some of the largest telecom operators in the world and provides technology to OEMs that make the components of telecom networks. HCL’s key products include SON, acquired from Cisco in 2020, and X-Haul, which o3ers OEMs a complete modern IP suite for millimeter wave and microwave radios.

As part of the manufacturing portfolio, Industry Software Division of HCL Technologies o3ers a rich set of tools and technologies spanning design, manufacturing and visualization to enable next-generation product development. With a track record of delivering business value, this portfolio is leveraged by leading global manufacturers across automotive, aerospace, industrial, high-tech, medical devices, consumer packaged goods industries, and OEM partners. Two key products include CAMworks and DFMPro.


Actian, a leading vendor of hybrid data management and analytics products based in Palo Alto, CA (U.S.A), was acquired by HCL in FY19. Actian enhances HCL’s Mode 3 o3erings in data management products and platforms.

As part of its services, Actian is working with clients to plan, prioritize and deploy transformations to next- generation cloud data warehousing technologies, and Actian’s capabilities are central to achieving this ambition. The platform creates end-to-end hybrid data solutions for all industry business units including HCL Software, through which some of Actian’s o3erings are being resold.

During FY21, Actian announced multi-cloud support for Avalanche cloud data warehouse on the AWS, Azure, and Google Cloud platforms. A highlight of this e3ort is the impending launch in Spring 2021 of the managed service in Google’s Cloud marketplace. The innovative hybrid solution delivers industry-leading scalability and price performance. It is also the first cloud data warehouse to o3er native enterprise integration features, a capability that allows enterprises to rapidly and inexpensively harness their diverse data sources for high performance analytics, both in the cloud, and on-premise. During FY21, Actian also delivered a comprehensive set of industry reference accelerators for solutions such as Customer 360, supply chain, and healthcare analytics.

Go-To-Market Framework

Today’s business world is in a flux. Although the coronavirus pandemic is partly responsible for this, numerous forces are creating challenges in every industry. Such challenges can most e3ectively be addressed by a combination of digital technology and human ingenuity, a partnership that HCL calls "The New Essential". Successfully navigating and overcoming these challenges requires seasoned domain expertise, dynamic technology architecture, and resilient go-to-market strategies.

This is the very strength of HCL’s vertical market-led sales organization, which comprises accomplished solution architects, industry-specific consultants, and business development leaders with deep-rooted experience.

Your company works closely with clients to implement its service o3erings, products and platforms to resolve technological challenges in each industry. The following description explains how this approach has contributed significantly to the company’s industry-leading financial performance over the last five years in crucial vertical markets.

In response to the COVID-19 pandemic, organizations across sectors had to fast-track the adoption of digital and cloud-led technologies. The vertical market-led sales organization for HCL’s IT and Business Services business, and Engineering and R&D Services has excelled at building expertise through a team of industry consultants, pre-sales solution architects, and industry business development leaders. This structure has contributed significantly to the company’s industry-leading financial performance in recent years.

Financial Services

The financial services industry is at an exciting inflection point, as technology redefines priorities and improves outcomes. Banks, insurers, and other financial institutions are currently in the midst of a profound transformation. As they rush to expand and deepen digital channels in the next major coronavirus-accelerated phase of digital transformation, they must also navigate a competitive environment of lower interest rates and rising cost pressures. They face significant challenges in terms of technology investments, technical debt, and digital talent availability and are under intense pressure to come up with a game plan to address competitive threats from new entrants and established players. The only way forward is a program of constant modernization of technology to digitize both front and back o3ces.

Your company has emerged as a strong business and technology partner for financial services organizations to address these challenges. Its digital-at-scale o3ering is helping clients adopt digital technologies to meet changing consumer behavior. Its digital foundation services are helping clients move to the cloud while modernizing their landscape. With its strong domain proficiency and technological expertise, combined with delivery and automation capability, the company is helping clients transform their cost base and deliver features at a higher velocity. HCL’s o3erings have been bolstered by investments in key proprietary solutions such as the HCL API Hub, which integrates and standardizes account information and payment initiation APIs o3ered by multiple banks. This solution helps banks save time and e3ort and reduces the cost of building diverse API ingestion facilities.

To help clients accelerate their digital journeys and deliver positive business outcomes, HCL is investing in vertical solutions in select high-spend areas, drawing on its proprietary solutions and commercial o3-the-shelf products to deliver digital business platforms of choice. These include open and contextual banking, payments, and next-generation claims. We’re seeing signs of a significant market for these solutions, based on wins in verticalized services and in leadership rankings by analysts.

Life Sciences and Healthcare

Your company’s Life Sciences and Healthcare (LSH) industry unit is well-positioned to cater to the surge in demand for digital transformation and modernization requirements by life sciences companies and healthcare enterprises, especially the healthcare provider and pharmaceutical segments. The demand is driven by virtual care needs, vendor consolidation, artificial intelligence/machine learning-driven decision making, and initiatives to convert internal products and services to marketed products.

HCL continues to support LSH clients with coronavirus pandemic-related activities, including those involved in vaccine R&D, testing, reporting, and post market support. Last year, the company launched a series of solutions and propositions targeted at helping its LSH clients under the theme "transcend today to thrive tomorrow".

HCL also expanded its solution portfolios in virtual care and remote health monitoring, decentralized clinical trials, digital workplace adoption, supply chain monitoring, cybersecurity, patient concierge services, and fast healthcare interoperability resource (FHIR), a standard for data formats that enables the exchange of electronic health records.

HCL’s LSH business is investing in helping clients through a number of initiatives including:

• Strengthening the digital foundation, which drives infrastructure modernization and cloud adoption

• Modernizing the digital core, which helps clients modernize applications to build a robust data backbone

• Enabling the digital frontier, which facilitates the adoption of next-generation technology in workflows – for example, intelligent automation to improve patient engagement, and new business models


The major disruption in the global supply chain ecosystem caused by the coronavirus pandemic, not only reshaped the proliferation of Industry 4.0 but has also pushed industry to decentralize their supply chain operations out of a handful of geographies. Manufacturers have started seeing the importance of digitally strong and connected value chains by adopting and investing in the key drivers of Industry 4.0 such as additive manufacturing, smart factories and assembly lines enabled by AR/VR/MR and IIOT (industrial Internet of Things) driven frameworks, and systems built on deep analytics to turn disruption into opportunities.

HCL’s Xpand 4.0 framework helps global manufacturers get the best out of their Industry 4.0 initiatives. It helps manufacturers expand into newer areas of growth by delivering phenomenal, connected experiences, powered by agile and smart digital ecosystems and convergence of data, process and insights. Xpand 4.0 enables immediate and tangible benefits of adopting Industry 4.0 by harnessing the power of existing industrial and enterprise data. By cutting through the four data silos – customer, product, operations, and ecosystem – the framework delivers insights and experiences that have a direct and significant impact on business and helps to achieve sustained competitive advantage. Xpand 4.0 is the company’s umbrella o3ering, encompassing Connected Design, Connected Factory and Connected Products and Services, in addition to its IP-based solutions portfolio.

The industry is undergoing a thorough examination of technical debt and many other problems caused by aging technology. The cost of obsolescence makes the need for digital transformation all the more clear. HCL is helping many of its clients through this journey using frameworks, methodologies, and solution accelerators. The company designed and formulated the FENIX 2.0 framework that helps clients look at their digital roadmap and applications that make up the value chain in a new perspective. It has developed an SAP digital acceleration solution through its own version of model companies called "Base 90" powered through "Rise with SAP" and "Move with SAP" outliners.

Your company has developed a number of industry-specific solutions helping clients fast track on the transformation journey in areas such as IT/OT (operational technology) collaboration at the plant level using HCL’s Plant Workblaze, which integrates IT and OT operations in manufacturing plants. It also developed solutions to exploit the tremendous amount of data collected in the plants through a Real Time Manufacturing Insights (RMI) solution to help organizations anchor, analyze and act on the insights derived from the various data points.

Public Services

HCL’s Public Services business helps clients across numerous industry groups that provide various types of critical societal infrastructure: oil, gas and natural resources; utilities; and travel, transportation, logistics and hospitality, among others.

The oil and gas industry is facing uncertainty due to supply and demand volatility. Oil was the worst performing commodity in 2020, lower than even coal. Taken with the underinvestment in the sector, the industry could face supply issues over a five-year horizon. To tackle these issues, companies will focus on variabilizing costs by accelerating digital transformation to reduce OPEX; this means having a platform-based approach to reduce custom solutions. Adoption of cloud, moving from full-time equivalent (FTE) to managed service provider (MSP) models, and adopting IT-as-a- Service models are key enablers.

HCL is working with clients on modernization and digitalization of customer facing internal systems and processes. The company’s Business Process-as-a-Service solution, specifically focused on Order to Cash within the downstream sector, is hinged on technology transformation driven by HCL Commerce to create an intuitive customer engagement platform.


In the utilities sector, the deep recession resulting from the coronavirus pandemic is only the latest disruption a3ecting the industry. Following decades of turmoil caused by deregulation, utilities now face growing pressure from governments and environmentalists to decarbonize their portfolios, by prioritizing areas such as clean gas, water conservation, and renewable energy. The decentralization and democratization of energy generation, with consumers not only buying but also selling electricity to the grid, is beginning to have an impact on the industry.

Over the last two years, HCL has helped utility clients address these challenges. With its "resilience at the edge" approach, it has built an extensive ecosystem of alliances and partners to deliver greater adaptability and help utilities on their transformation journeys. It is helping clients leverage cloud transformation, data and insight-driven operations, multi-channel customer engagement, and an integrated information technology/ operational technology model based on business outcomes to keep up with and stay ahead of rapid changes in their environment.

In the post-coronavirus era, travel, transportation, logistics, and hospitality companies are emerging from travel and supply chain disruptions against a backdrop of unprecedented acceleration in e-commerce adoption and severe stress on asset utilization. As HCL’s clients build an array of di3erentiated digital experiences across the value chain, it is helping them establish optimized supply chain platforms that scale to support HCL solutions like Connected Fleet, Warehouse of the Future, Advanced Control Towers, Cold-Chain Custody, and Hyper-Personalization. It is also strengthening its business consulting and transformation capabilities across the supply chain and e-commerce through a team of seasoned industry architects in the areas of data and cloud.

Retail and Consumer Packaged Goods

The COVID-19 pandemic precipitated not only a global health and humanitarian crisis but an economic one as well. And the retail and consumer packaged goods (CPG) sectors were among the a3ected, in ways both positive and negative. The sector experienced: skyrocketing demands for groceries, prescription drugs, and healthcare and other essential consumer products; unprecedented and unpredictable supply chain disruptions that forced companies to build resilience into their systems to meet current and present crises; government-enforced closures of retail outlets in non-essential sectors, forcing retailers to make tough choices about such issues as furloughing employees and optimizing the number of stores; sharp declines in discretionary consumer spending that crippled non-essential retail outlets; increased concerns for the health and safety of the workforce, and the need for retraining resulting from attrition; remote workforce enablement, coronavirus-safe practices, and associated cybersecurity concerns.

All these challenges led to fast-paced digital transformation programs, accelerated business processes, and adoption of emerging technologies to help organizations: reprioritize their investments, redesign their strategy, rethink client touchpoints, invest in data-led decision making, enable and train employees to work digitally in fulfilment centers, and deploy a resilient approach toward cybersecurity.

HCL has ready-to-deploy digital architectures to redefine business models based on industry experience in transforming business processes to achieve digital transformation. In the last 24 months, specifically during the onset of the COVID-19 pandemic, the company has delivered cutting-edge transformation to clients, leading to increased revenue, better client retention, and overall client satisfaction.

The top areas of investment by HCL’s Retail and CPG vertical are:

• Data and analytics-led solutions for insight-based decision-making, to drive hyper-personalized customer experiences across value chains, leverage data related to customer lifetime value, and improve recommendations for retailers/CPG companies on their brand perception

• Driving higher sales and post-sales processes through unified omni-channel commerce experiences and order management solutions

• Delivering innovative, business process-led digital transformation enabled by SaaS, PaaS and hybrid cloud-based technologies to deliver results faster, better, and with cost e3ectiveness

Technology and Services

The coronavirus crisis and the resulting market opportunities have strengthened the business fundamentals of the technology sector over the past year. Today, many technology companies are more prominent and enjoy a stronger network e3ect than ever before. Enhanced customer experience and accelerated innovation are at the center of many current and future digital initiatives and capabilities and are top priorities for technology and services companies.

HCL’s technology and services industry vertical works with most of the world’s leading technology companies to help them capitalize on business opportunities and navigate operating model challenges. It orchestrates core applications, infrastructure, engineering, and business services to enable desired outcomes for its clients.

HCL’s industry service o3erings are designed to help clients improve productivity and e3ciencies; o3er products as-a-service; e3ectively monetize user-generated content; build and support a digital front o3ce to enable sales across lead-to-cash areas; and enable sales across both sides of their platforms with users and developers to build strong communities.

The company also uses its engineering expertise to build and maintain products for technology clients – for example, product/platform engineering, sustenance, and testing for technology enterprises including implementation of Industry 4.0 practices within product development and original equipment manufacturing (OEM) lifecycles.

The top areas of focus and investment in this vertical are designed to enable clients to make significant positive changes in their businesses.

• Help enable and redefine go-to-market strategies to o3er everything as a service: This trend has helped HCL launch a new service o3ering that enables product companies to self-fund transformation initiatives to o3er products as a service

• System integration and next-generation operating models: HCL enables system integration and new operating models for companies with new age o3erings for edge computing/5G enabled use cases

• Streamline supply chains through technology-led, digital interventions: HCL helps global enterprises transform themselves through projects that span transformation roadmap evaluation, business process re-engineering, continuous business process improvement, process optimization and automation and more

• Use of intelligent automation: HCL’s intelligent automation o3ering, available across business functions such as manufacturing management, supply chain/planning, procurement, and quality, can help reduce costs by 25–30 percent

• Divesting non-core aspects of businesses: Technology and services companies are using mergers and acquisitions to sustain profitability, create new sources of revenue and build a diversified portfolio of products. HCL helps software and other technology companies divest non-core business areas, such as back o3ce operations and customer-facing functions, to improve EBIT margins and raise their Net Promoter Scores through structured carve-out deals

• Enhance and scale SaaS operations: HCL enables infrastructure reliance and stability for SaaS operations. It is sharply focused on building hyper-scaled operations capabilities to help cloud/SaaS organizations build and operate scalable architectures

Telecommunication, Media, Publishing, and Entertainment

The telecommunications, media, publishing, and entertainment industries are undergoing disruptive transformation fueled by a series of mergers and acquisitions; the convergence of telecom and media; adoption of 5G/multi-access edge computing; growth in direct-to-consumer businesses; and an explosion in streaming media (especially during the COVID-19 pandemic). Overall, a new telecom, media, and entertainment ecosystem is emerging. Globally, technology players, including global service providers like HCL, are partnering with telecom companies to improve access to market, grow enterprise revenues, and build marketplace platforms. Industry 4.0 promises to reshape sectors ranging from automotive to healthcare, enabling an array of benefits such as predictive monitoring, waste elimination, and enhanced customer experience – all on the backbone of a telecom infrastructure that is being transformed by 5G. Evolving industry trends are forcing cable companies to create new revenue via high-speed broadband and home gateway services. Media is focused on improving collaboration, from content creation to distribution of content. New content formats, streaming direct to home, contextual advertising, and new digital products will become enablers of growth. E-sports is revolutionizing the gaming industry.

HCL’s sharp focus on "convergence" of industries within the telecom ecosystem like gaming, manufacturing, healthcare, retail, finance and media is accelerating new revenue and cross-industry play for clients. With a heritage in device/product/platform engineering and excellence in operations and automation, the company is successfully scaling the business objectives across the communication service providers.

Core to the company’s growth strategy has been a deep industry focus; acceleration of innovation via investment in industry solutions, proprietary solutions, labs, partnerships; and acquiring, renewing, and retaining long-term strategic clients for technology-led business transformation.

This strategy has been supported with a number of key investments. To help clients accelerate 5G modernization and network transformation, HCL acquired Cisco SON technology, which optimizes performance of the radio access network (RAN) portion of mobile solutions. To capitalize on industry discontinuities such as over-the-top media services, the Internet of Things, content monetization, online education, and technology-infused "smart spaces," HCL is establishing 360-degree partnerships (in which partners, for example, service each other’s customers) with hyper-scalers, original equipment manufacturers (OEMs), and independent software vendors (ISVs), to generate new joint revenues.

Key Focus Markets

Your company continues to explore additional growth opportunities across geographies. As a $10B global enterprise, the organization’s business development ambitions extend beyond large geographies, into growth and frontier geographies for the next wave of growth. Beyond the larger markets where HCL is well present – United States, United Kingdom, Nordics etc, it is evident that organizations in Continental Europe and Asia Pacific are looking for partners to help them develop and implement a digital roadmap for the future. Some of these markets for HCL are largely untapped by Indian IT outsourcing companies and represent significant growth opportunities.

The company has identified certain geographies, including Germany, Australia, Canada, France and Japan, as markets poised to play a significant role in its growth strategy. Plans for these regions include creating new onshore/nearshore delivery capabilities, engaging with the local communities, and building e3cient and seamless ecosystems of clients, partners, and employees.


Germany is Europe’s largest economy and ranks fourth in the world by nominal GDP. Driven by industrial leadership, Germany is evolving to become a leading digital transformation hub. After the initial business reaction to the COVID-19 pandemic, a second digital optimization wave is opening up new business opportunities. That wave is characterized by a more strategic approach towards make-or-buy decisions, sourcing and outsourcing preferences, and cloud-first strategies.

HCL has invested heavily in the German market through acquisitions, including Geometrics and Hnigsberg & Dvel (H&D). The company has significantly grown its local talent, broadening its expertise and footprint in the manufacturing and automotive industries. A strengthened local leadership team has helped expand the company’s business partnerships with several large German-headquartered organizations across multiple sectors.

Despite the impact of the global health crisis, HCL Germany witnessed its most successful year on record. Services such as Digital Workplace, Hybrid Cloud Transformation and Operation, Digital Transformation (including SAP S/4HANA), enabled critical digital business transformation, next generation application management, and cybersecurity initiatives.

Clients choose HCL as a trusted partner because of its industry-leading functional and technical expertise, highly collaborative communication and working style, and commitment toward total cost of ownership (TCO) optimization. The company o3ers an optimal mix of onsite-nearshore-o3shore delivery capabilities and the willingness to assume risks and accountability.

As Germany emerges from the global health crisis, HCL is well prepared to work with German companies as they reset their business and operating models in the new post-pandemic reality.


France is the seventh largest global economy and the third largest IT services market in Europe, one with a high propensity to outsource IT services, traditionally to local French companies. Global players, especially those from India, have found it di3cult to establish a presence at scale in France, as they have done in the U.K, the Nordics and other European countries.

France is a high-priority growth opportunity for HCL. Over the last few years, HCL has significantly grown its French team and invested in operations there, including the creation of a digital delivery center in Lyon that delivers innovative industry solutions for clients.

The COVID-19 pandemic increased the growing ambition of French companies to invest in the digital transformation of their organizations to support greater resilience, agility and new ways of working though cloud, digitization, and IoT. HCL France has always focused on large French multinational companies seeking a partner that can service them locally and globally in growth markets. A strategy based on this helped win some significant brands and global organizations. HCL France was ranked first for Cloud Integration Capability and second overall in Whitelane’s 2020 French IT Sourcing Study.

Recruiting local talent has been crucial. Several key leadership positions, including country manager, client partners and head of marketing, have been filled in the past two years by local hires. HCL’s local talent in the region now stands at 85 percent. For the second year in a row, the company was recognized as a Top Employer in France by the Top Employers Institute.

As a global organization, HCL understands the importance of investing in the communities where it operates, and over the past year it has partnered with Apprentis D’Auteuil to support the Coders of Tomorrow program for disadvantaged students. HCL was also the winner of the Choose France – Indian Investment in France Award 2020, presented at an event organized by the Indo-French Chamber of Commerce and Industry in partnership with Business France and the French Ministry of Economy and Finance. HCL France has also established a local corporate social responsibility (CSR) council that helps employees set up projects in support of causes they are passionate about.


Your company began its journey in Australia in 1999 with the opening of regional o3ces in Sydney. Since then, it has created a remarkable ecosystem of employees, partners, customers and communities, transforming the business landscape. The company has earned the trust of more than 50 clients in Australia through its unwavering focus on customer-centricity, disruptive thinking and next- generation IT delivery.

HCL is emerging as the partner of choice for leading firms in Australia, including financial enterprises, supermarket chains, telecommunications companies, and Australia’s largest city council. Strong business capabilities, di3erentiated market and growth strategy, and commitment to the local communities have helped HCL foster trusted and deep-rooted relationships with Australia’s leading brands.

On 5 January 2021, HCL confirmed the o3cial completion of its acquisition of the DWS Group. Established in 1991, DWS is an Australian IT, business and management consulting services company. DWS provides a wide-ranging and flexible suite of services including human-centered design and digital transformation, program and project management, business analytics and data, customer-driven innovation, strategic advisory and productivity services, application services, and robotics process automation. DWS is headquartered in Melbourne with o3ces across the country.

HCL employs more than 2,200 experienced, talented and culturally diverse professionals throughout Australia and is increasing local hiring and talent with the acquisition of the DWS Group. The acquisition boosts HCL’s local digital capability and enriches the local talent pool while expanding the company’s portfolio.

HCL is also taking a lead on diversity and inclusion, ensuring existing and future workforces represent the entire community. To this end, the company launched its flagship Women Lead Australia program in 2015. The one-to-one mentorship program has helped advance the careers of more than 90 women across the HCL ecosystem of partners and employees. HCL is committed to developing a robust ecosystem to support Australia’s current and emerging business needs for the decades ahead.


Canada represents a strategic market for HCL for business growth and creating onshore and nearshore delivery capabilities. As a multicultural region with 145 spoken languages and a diverse global population, Canada o3ers HCL a high-quality talent pool with an abundance of skills.

The coronavirus pandemic has compelled Canadian organizations to rethink their business and operational strategies, pivot to new strategies, embrace new ways of working, and accelerate digital transformation.

Canadian organizations continue to invest heavily in cybersecurity from the data center to the cloud to better support remote work and adopt innovative models, such as screen recording, for highly regulated deliveries in financial services and healthcare.

The pace of cloud adoption in Canada is increasing, with initial project delivery timelines compressed from 12 to 15 months to six to eight weeks. Cloud native solutions accelerate digital transformation and enable businesses to o3er an optimized digital pathway toward market relevance, business agility, and customer-centricity.

Customers are turning to HCL as a trusted partner that o3ers di3erentiated value and ease of doing business. HCL’s core values – trust, transparency, value centricity, and flexibility – equal relationships that extend beyond the contract. HCL, featured as a Leader in the IDC Cloudscape report for the Canadian market, boasts pedigree, maturity, and capability in both the cloud and digital arenas.

The company has increased its investment in Canada, scaling the organization to more than 1,200 people with plans to continue to expand the local workforce by an additional 2,000 people over the next three years. It is creating global development centers in multiple cities across Canada, including a 350-employee center in Mississauga, just outside Toronto, with more centers opening in other key cities.


Japan is the world’s third largest economy and is among the top three countries in R&D spending. Japan is hailed for its manufacturing leadership and e3ciency, as well as its hardware product excellence. However, in the context of an increasingly digital world, software platforms are dominating the market. In response, Japanese organizations are transforming their business models into software-defined and platform-centric enterprises. New talent and capabilities are needed to support this transformation, and businesses are augmenting their existing workforces by sourcing skills externally.

HCL’s focus on digital engineering and platform engineering makes it an ideal partner to support Japanese companies as they transition into digital entities surrounded by a platform ecosystem. In support of Japan’s service delivery requirements, HCL has opened a Vietnam-based delivery center, which represents a critical achievement that advances its ability to provide the expertise and capability needed to support digital transformation in the region.

HCL is the largest India-oriented global engineering service provider in Japan. With its cost advantage, next-generation engineering and technology, and signature "Relationship Beyond the Contract" culture, it is an ideal partner to support Japanese companies throughout their digital transformation journeys.

New Frontier markets

Apart from the above focus geographies, your company has identified the next set of countries for investment in the near term to take advantage of their growth in the medium term. These countries have been chosen on a variety of criteria including IT services market size and growth, propensity to partner and transform digitally and long-term socio-economic stability. The first set of countries identified include Brazil and Mexico in the Americas, South Korea, Vietnam, and Taiwan in Asia Pacific, South Africa and UAE in Africa and Middle East, and Italy, Spain and Portugal in Europe. This growth strategy would be driven by local geographic leadership coordinating the ongoing e3ort of the vertical sales, technology practice and service-led delivery organizations. This would be well supported through various other initiatives including local delivery centers, talent localization and local market partnerships with consultants and other service providers.

Building the HCL Brand

Engagement in the New Normal

Your company’s four decades of experience helping clients grow, innovate, and reimagine their businesses for the digital age kicked into overdrive in 2020 as the coronavirus pandemic accelerated clients’ digital transformation timetables. This allowed the company to showcase its ability to help clients quickly solve their most vexing and important problems with innovative solutions. The tumultuous year was also marked by HCL reaching the milestone of $10B in annualized revenue, as it continued its industry-leading growth. Such business highlights were among the key messages communicated to highlight the quality and value of the work HCL does. But HCL also positions itself in a more holistic manner that reaches beyond the goal of generating new business to tell the larger story. Its marketing programs also increase HCL’s brand value; enable its sales professionals to improve their skills and maximize their potential; and deepen relationships with stakeholders, including clients, ecosystem partners, industry analysts, employees and prospective employees, and the communities where the company operates.

A number of HCL general brand initiatives have been directed at furthering these goals including: a refresh of brand assets, a mergers and acquisitions (M&A) driven brand integration framework, a crisis management framework and policies, and the development of new social media policies. In response to the COVID-19 pandemic, under the #OneHCL banner, the company executed additional brand programs to communicate its priorities and plans, reassuring clients and other stakeholders of its ability to achieve business continuity with minimal disruption.

Among those stakeholders are the industry analysts and advisors who provide third-party assessments of HCL and its competitors and advise clients and prospects on their choices of service provider. During the year, HCL successfully engaged with more than 450 analysts and advisors through various platforms, including its first virtual Analysts and Advisors Day. HCL was the subject of 16 dedicated analyst reports and was positioned as leader in more than 190 competitive assessments.

Women technology executives are another important stakeholder group, and HCL runs or sponsors various programs built around their interests and designed to increase the number of women technology leaders. Building on HCL’s successful Women Lead Australia program, a one-to-one mentorship program for women technology executives begun in 2015, Nordic countries launched their own Women Lead program, with 18 up-and-coming women leaders graduating in November 2020. The company also partnered with International Women’s Day to host a high-profile series of global panel discussions, Tweetchats and interviews.

Employees have always been a key stakeholder for HCL, with its philosophy of putting employees first and fostering grassroots innovation by its 168,000+ "ideapreneurs". The company demonstrated this commitment and built a deeper connection with employees through programs to communicate with and support them during the COVID-19 pandemic (see the Talent section).

Whatever the stakeholder group, external or internal, HCL’s engagement with them was often digital and virtual during the past year. Among the initiatives:

• Branded interactions for virtual client and lab visits, analyst day presentations, and employee onboarding and town halls

• Virtual events, including the launch of HCL’s first European Cybersecurity Fusion Center in Sweden, the opening of new delivery centers in Sri Lanka and Vietnam, and a series of six live events in collaboration with Cricket Australia with 600 clients participating

• The HCL BetterHealth Hackathon, the world’s largest crowd-sourced event around COVID-19 pandemic (#CodeforCovid19), in which more than 40 client stakeholders and 7,500+ innovators from 1,000+ organizations and academic institutions in 50+ nations generated more than 250 ideas to address problems resulting from the pandemic

• Sales training initiatives, involving more than 600 HCL sales and pre-sales professionals, to increase virtual marketing and social selling capabilities and to enhance understanding of next-generation technologies

• Nineteen HCL Straight Talk Tweet chats – focusing on various business topics related to the coronavirus pandemic, and featuring HCL clients, executives and industry thought leaders – garnered an average of 47 million Twitter impressions per Tweet chat

Awards and Recognition

• Your company has been recognized as part of the Top15 leaders in the outsourcing marketplace by the leading global technology research and advisory firm, ISG. This recognition positions HCL for further growth and confidence in its ability to deliver excellent value and service to both existing and new clients around the globe. The ISG IndexTM is recognized as the authoritative source for marketplace intelligence on the global technology and business services industry

• HCL Technologies was given the highest governance quality score of 1st decile from Institutional Shareholder Services (ISS). The score of 1st decile indicates higher quality and relatively lower governance risk. The score is derived after reviewing four key tenets of board structure, shareholder rights, compensation, and audit and risk oversight

• Your company’s customer satisfaction (CSAT) scores are at an all-time high with Experience Index at 74.9. This performance, even in the toughest of times, reflects the confidence clients have in the company and the depth of its partnership with them in their digital transformation journey. HCL passed the 70 mark on Experience Index (EX) across all service lines and three out of four customers polled are delighted in each of the services provided by HCL

Taken together, these marketing and sales enablement initiatives help further HCL’s aim of being a partner of choice and an employer of choice worldwide.

Talent Management

In calendar 2020, your company’s revenue exceeded $10B, making the company one of the top 10 technology services companies in the world and capping o3 a momentous year for the company. What brought HCL to this significant milestone little more than two decades after HCL’s Stock Exchange listing in December 1999? The answer is simple: HCL employees’ collective passion, energy, and e3orts.

In grateful acknowledgement of this, all employees with one year of service or greater received in February a one-time monetary bonus that was the equivalent of 10 days of their monthly salary.

Employees’ continuous contributions to HCL’s success made it natural for their health and safety to be the centerpiece of HCL’s response to the coronavirus pandemic. The #TakeCareHCL initiative has consistently shared information about the pandemic among HCL’s 168,000+ employees to educate them about prevention strategies and numerous specific initiatives to support employees and their families. A dedicated coronavirus portal provides consolidated information about topics such as testing and one-point access for families facing a health emergency. In partnership with HCL Healthcare, an extensive employee outreach program in India continues to track employees’ health status and provide additional support to them and their families.

The world continues to witness a staggered and uncertain post pandemic recovery pattern. The secondary wave of the COVID-19 pandemic in the U.S and Europe, as well as recent localized spikes in infection in India, have led to regular re-evaluations of a return-to-o3ce strategy, which includes a calibrated plan based on vaccine availability and local government guidelines in each geographic location.

In recognition of what it calls a duty of care commitment to employee health and safety, HCL has become the first India-based IT company to achieve the PROTEK certification from Intertek, the global quality assurance leader. The PROTEK certification program has been designed based on the POSI – prevention of spread of infection – approach and o3ers audits along with training, inspection, verification and certification solutions.

Talent by the Numbers

Your company had a workforce of 168,000+ from 157 nationalities at the end of the financial year. Women comprise 27.2 percent of this global workforce.

A commitment to talent localization continues. HCL believes this strategy provides a competitive advantage in a tightening regulatory environment that sometimes limits workforce mobility. For example, in the United States, the localization rate is 70.4 percent of the total workforce in the country.

Your company is also in the process of expanding its o3shore delivery centers globally. The company announced the commencement of its operations in Sri Lanka in June 2020. Within the first 18 months of kick-starting its operations in Colombo, HCL plans to create more than 1,500 new local employment opportunities for both early career hires and experienced professionals in Sri Lanka’s capital.

Your company announced its entry into Vietnam in December 2020. A local entity, HCL Vietnam Company Ltd., plans to work with local IT and engineering institutions to foster economic growth and provide new skills for the nation’s talent pool, with a goal of hiring more than 3,000 local university graduates and experienced professionals over the next three years.

Your company continues to focus on tapping the unique advantages of Tier 2 cities in India, which enable enhanced operational resilience, stability and scalability. Employee headcount in the cities under the company’s New Vistas category (Lucknow, Madurai, Nagpur, and Vijayawada) is up nearly 43 percent from the last fiscal year.

Talent Development

Your company’s Talent Development Center of

Excellence (COE) seeks to create a culture of continuous learning through business-focused education solutions, with the aim of helping to realize the vision of building a leading global organization. The key emphasis is on developing current and future business competency requirements within a rapidly changing landscape.

For example, the need to work in a virtually connected mode because of the COVID-19 pandemic has led the Talent Development COE to develop training in new competencies that have become an integral part of the portfolio of learning solutions being deployed globally. Training in these new skills was also translated into micro-learning nuggets to engage HCL sta3 and provide them the necessary leadership perspective during these trying times.

38,400+ employees participated in various talent segment-based learning journeys in professional, behavioral, cultural, and leadership skills development worth 140,000+ learning hours during the year.

During the fiscal year, 120,652 employees availed themselves of 6.64 million hours of training for enhancing their current skills and learning new skills. 47,232 unique employees also trained in digital skills during this period.

Talent Diversity and Inclusion

Your company is committed to hire talent from diverse backgrounds across the globe to create a unique culture based on a variety of values and traditions.

Based on four decades of experience building and scaling a multinational enterprise, HCL believes that diversity and inclusion in the workplace is an asset for both businesses and their employees. Diversity helps foster innovation, creativity and empathy in ways that homogeneous environments seldom do.

However, creating a diverse and inclusive environment takes careful nurturing and conscious orchestration. HCL has crafted multiple initiatives for its diverse employees to realize their potential, while striking a good work-life balance. The company is consciously dedicated to creating and sustaining a culture of equality, self- awareness, authenticity, and accountability in the realms of gender, ethnicity multiculturalism, disabilities and LGBTQ+ inclusion.

E3orts toward creating an inclusive environment should translate into people feeling valued, being treated equally and with respect, being able to safely express their opinions, and feeling empowered to make decisions and do their best. An Inclusion Lab and an Inclusion at Scale initiative have been launched for all employees to foster inclusive work environments.

These targeted initiatives have helped HCL make tremendous progress over the years in fostering gender diversity and inclusion. As noted above, women now account for more than one-quarter – 27.2 percent – of the global workforce, while 12.6 percent of senior leaders at the company are women.

Your company hired 55 persons with disabilities as employees in current FY. In FY21, Pride@HCL has expanded its footprint to four new geographies and with a steady increase in enrolments of self-identified LGBT+ employees and their employee allies to the Employee Resource Group (ERG).

But these diversity initiatives are only a start. The company’s near term goal is to improve gender diversity by five percent through targeted talent acquisition over the next three years, and increase the percentage of women in senior leadership roles by one percent year-on-year. More broadly, there will be a focus on underrepresented ethnicities and other groups, including persons with disabilities and those who identify as LGBTQ+ groups, for all new positions to be filled.

Talent and HR Awards

To reinforce the alignment of HCL’s core beliefs and actions, the company continues to transform its policies, processes and practices. Its distinctive people practices continue to win accolades across the globe.

• HCL has been recognized as a Top Employer 2021 for its exemplary HR performance by Top Employers Institute. HCL has been awarded this status in France, Germany, the Netherlands, Australia, New Zealand, Philippines, Poland, Singapore, South Africa, Sweden, and the United Kingdom – in the U.K, for the 15th straight year

• HCL has been ranked No. 30 in Forbes’ fourth-annual list of the World’s Best Employers 2020 and ranked No. 1 among multinational companies headquartered in India

• HCL’s e3orts in recognizing diversity have received several awards and recognitions:

› Brandon Hall Gold Award for Best Inclusion and Diversity Strategy

› Brandon Hall Gold Award for Best Unique or Innovative Learning and Development Program

› Bloomberg Gender-Equality Index

› 2020 Working Mother & Avtar 100 Best Company for Women in India recognitions:

– One of the Top 100 Best Companies for Women in India

– Exemplar of Inclusion award in the Working Mother & Avtar Most Inclusive Companies Index (MICI)

• The Stevie Awards

› Most Innovative Work from Home Plan–All Other Nations: Gold

› Most Valuable Employer–Asia Pacific: Silver

› Most Valuable HR Team (recognizing an organization’s work during COVID-19) – Asia Pacific: Silver

Risk Management

Integrated risk management combines strategic and operational practices to support risk-enabled decision-making that is intrinsic to HCL’s culture. The company’s Enterprise Risk Management framework uses a top-down approach to categorize risk in order to shape organizational strategy and achieve key business objectives, including distilling insights and providing clarity on the key risks shaping company performance; supporting risk-informed decisions at the board of director (Board), executive management, and operational management levels; ensuring a risk dialogue among the management team; and enabling proper risk oversight by the Board.

Supply Side Risks

Clients rely on technology players to drive their business outcomes from transformation initiatives to expand revenue and optimize cost. On the supply side, the technology players have become part of a fragmented market, with a few large players and the arrival of many boutique players, resulting in tighter SLAs and competitive pricing. Failure to meet these standards by technology players may result in loss of market share and lead to reduced growth across the top-line and bottom-line.

HCL has robust governance in place to continuously assess clients’ expectations and work on proactive measures to deliver committed value. Its sales and delivery teams engage on a regular basis with clients to ensure seamless execution of engagements, within the SLAs. And its delivery capabilities are equipped with a set of rich frameworks, IP, and accelerators to enable this execution.

To address future demand, HCL continuously invests in next-generation technology and skill development to stay relevant to clients’ ecosystems. Product and platform roadmaps are created and constantly updated based on feedback from clients, market trends, emerging technologies, and other parameters. Di3erentiated full-stack o3erings help maintain and enhance customer mindshare.

Pandemic and Infectious Disease Risks

The ongoing Coronavirus pandemic or the outbreak of new variants and other infectious diseases could impact HCL’s service delivery and business execution across geographies. The specific risks related to various parts of the organization are listed below:

1. Service Delivery and Client Commitments: HCL could experience disruptions in operations and service delivery due to subsequent waves of Coronavirus or other infectious diseases leading to government lockdowns, restricted mobility, and reduced availability of the workforce. As a result, service level agreements with clients could be impacted causing clients to impose penalties in their contracts with HCL.

2. Future Business Prospects and Sales: HCL could possibly see a decline in sales due to the global economic slowdown, especially from sectors significantly impacted by the Coronavirus pandemic, such as oil and gas, travel and hospitality, high-end retail, and manufacturing.

3. Employee Health and Wellness: The Coronavirus pandemic may produce long-term consequences on mental and physical health leading to loss in productivity and emotional availability among HCL employees. As the economic downturn continues, further tangential e3ects stemming from the pandemic may arise.

4. Adapting to New Operating Models: With 90 percent of HCL’s workforce working remotely for the past year, the Coronavirus pandemic is shaping a long-term shift in operating models. Inability to manage timely structural and cultural transformations to transform its operating model may inhibit HCL’s ability to unlock new value in a post-Coronavirus world.

As part of business continuity management, HCL has established a pandemic response policy and plan to oversee its global response and to monitor pandemic situations in locations in which it operates.

The company initiated its pandemic response plan on 26 January 2020, one of the earliest across the globe, to oversee its response around five key focus areas: safeguarding employees, minimizing impact to clients, reducing financial impact to HCL, maintaining supply chain resilience, and providing support to communities in which it operates. Crisis governance under the company’s executive crisis management team, guidance from the Board, and engagement with external experts enabled a timely and e3ective response.

Very early in the outbreak, 150,000 employees were seamlessly enabled to work remotely. Appropriate steps were taken to ensure secure work from home procedures and environments for employees. As lockdowns eased, the transition back to o3ce was made voluntary and implemented in a secure, staggered way. A 24/7 global helpline provided free well-being services for employees and their families. An empathetic and bespoke communication plan named #TakeCareHCL reinforced the company’s commitment to people. A Coronavirus resource hub on the intranet kept employees advised on safety, remote working risks and policies, and strengthened communal bonds to restore confidence. Virtual events and well-being programs fostered meaningful connections between leaders and teams, employees and families in the era of social distancing. Predictive analytics on the impact of the pandemic, discussed and analyzed in a virtual situation room, helped leaders make real-time decisions.

More than 90 percent of HCL’s employees said they were "very satisfied" with the company’s initiatives to care for them. HCL enabled 3.5 million client employees to work remotely and 99 percent of the clients polled across 600+ key engagements rated HCL’s pandemic response as "very e3ective" or "e3ective".

The world continues to witness a staggered pattern of returning to o3ces, due to secondary waves of infection in India, the United States, and Europe. In line with HCL’s strategy to ensure a safe return to o3ce, a calibrated plan based on vaccine availability and government guidelines by geography is being evaluated. This strategy is supported by innovative technology solutions to ensure safe and secure workplaces in line with global best practices and emerging Coronavirus guidelines.

Business Continuity Risks

HCL’s reputation as a leading technology company is measured by its threat resilience and how e3ectively it can respond to disruptive events in a complex and fast-changing global risk landscape. The company faces business continuity risk if the organization is unable to ensure continuity of its operations across clients, delivery locations, and enabling functions.

The pandemic has drastically changed the paradigm of crisis and resilience planning. This has resulted in organizations transforming Crisis and Resilience (C&R) into a Board-level concern. This development has prompted HCL to re-imagine its program in line with the new normal, in which multiple large-scale global events which last for extended periods of time are to be expected.

In line with its philosophy of continual improvement, HCL is upgrading its C&R program to become a more robust, comprehensive, and future-focused C&R program that will help it respond to the evolving threat landscape. The company continues to focus on integrating resilience as an intrinsic part of its business operating model and seeks to embed resilience by design across the dimensions of work, workforce, workplace, business operations, technology, supply chain, and leadership.

Information and Cybersecurity Risks

With the ever-evolving technology landscape, there is continuous risk to the confidentiality, integrity and availability of HCL client and company data which, if adversely a3ected, has the potential to impact HCL’s corporate mission.

HCL places high importance on information and cyber security by implementing a comprehensive governance program across the company and 3rd party partners. The program includes proactive detection and response to incidents that are managed through resolution and reported to management, as well as continuous awareness training to increase e3ective cybersecurity skills for all sta3. The Information and Cybersecurity program ensures a strong security posture for HCL and its clients. HCL’s security posture has been validated by independent, industry-recognized certifications including quarterly oversight by the Board. HCL also has cyber insurance that covers di3erent types of breaches and cyber events. The company has not experienced any material cyber breaches in the past three years.

Geopolitical Risks

Instability and uneven growth in the global economy has had an adverse impact on the growth of the IT industry in the past and may continue to impact it in the future. Any future global economic or political uncertainties may result in the reduction, postponement, or consolidation of IT spending, contract terminations, deferrals of projects, or delays in purchases by clients. Such uncertainties can impact industries that drive a substantial portion of HCL’s revenue, such as financial services, manufacturing, life sciences and healthcare, and public services. Heightened geopolitical situations among the major economies may also impact HCL’s ability to grow holistically across regions.

HCL has set up a geopolitical framework to assess geopolitical risks on an ongoing basis. The program continuously assesses and improves HCL’s brand narrative for clients and employees worldwide. The company has been expanding its business across various countries to minimize dependence on any single country for revenue growth and service delivery. HCL also continues with the strategy of hiring local talent through various internal programs to avoid adverse impact on business due to various restrictions on free mobility of sta3. HCL strategically invests in a flexible workforce model of onsite, onshore, near shore, and o3shore resources to address these concerns and empower the best talent to solve client business challenges.

Regulatory Compliance Risks

HCL operates in a continuously expanding list of countries and industry sectors, resulting in an increased risk of non-compliance with regulatory requirements that are relevant to its business. To mitigate this risk, HCL has established dedicated functions that review and monitor regulatory requirements across geographies and industries. HCL’s comprehensive global regulatory compliance framework is designed to identify, assess, mitigate, and monitor regulatory risks impacting HCL. The framework prevents not only the violation of laws and regulations, but also protects the company’s reputation, employees, and clients. Regulatory assessments are carried out and detailed checklists are maintained to ensure compliance. Where required, mitigation plans are put in place to address any identified non-compliances. In addition to this, quarterly compliance certificates are presented to the Board by the respective functions with responsibility for such compliance.

Privacy Risks

HCL’s scope of processing personal data of individuals, enterprises, vendors, and contractors has further increased with the response to the Coronavirus pandemic. Most countries have stringent and dynamic privacy laws, especially in regard to health and medical data, and the privacy landscape is continually shifting as further case law or privacy actions are brought by individuals. An example is the recent Schrems II decision that has tested most organizations’ privacy programs. This further increases the risk of non-compliance with privacy and data protection laws and regulations.

HCL has an established framework in place that includes global oversight by way of governance, policies and procedures, training and awareness programs, global privacy impact assessments, privacy by design, data mapping, third-party contractual oversight, incident management, and a mechanism for monitoring regulatory compliance for every geography. This ensures capabilities exists to support global privacy compliance in a dynamically evolving space requiring support of regional privacy compliance variances. HCL is further supported by industry-recognized certifications and accreditations as well as oversight from an external global data protection o3cer who has accountability and reports directly to the Board.

Talent Management Risks

As HCL continues its growth journey, talent management and meeting the ever increasing demand for new talent poses a significant continuing risk. The company’s strategy is to focus on building the workplace of tomorrow, one which promotes a collaborative and transparent culture. HCL deploys a robust training strategy designed to meet the development needs of employees across leadership levels. This includes professional, functional, technical, and leadership development learning solutions. The HR team continuously aims to reach every employee to support their growth and provide employees with progressive career paths through internal opportunities. This allows them to fulfill their aspirations through comprehensive career development and skill development plans. The Career Connect program helps guide succession planning strategies through both vertical and horizontal advancements.

Acquisition-Related Risks

From time to time, HCL acquires other companies or businesses, and the success of these acquisitions depends upon several factors. These include the e3ective integration of acquired employees with the rest of the company and the optimum realization of synergies between acquired business and the company. Such transactions expose the company to the risk of impairment of goodwill and other intangibles. HCL has pioneered a strategy to successfully gain significant value from acquisitions through a unique inorganic growth model which identifies value assets that can be enhanced through creative synergies. Following an acquisition, there is an ongoing integration and performance management program to enable acquired businesses and HCL to get the maximum returns on these investments. Board committees periodically review the performance of acquired businesses, and take corrective action when needed. Impairment of goodwill and other intangibles are evaluated at least once at the end of the year.

Tax-Related Risks

HCL is subject to taxes in numerous jurisdictions worldwide and enjoys tax benefits in India on its software exports under the Special Economic Zone scheme of the Government of India. Any changes in tax laws in India and other countries where HCL has significant presence can have adverse impacts on the e3ective tax rate of the company. Since HCL operates in several jurisdictions, transfer pricing arrangements among legal entities in these jurisdictions are always subject to review by various tax authorities. HCL’s strategy for tax- related risk is to employ specialized tax teams that keep abreast of latest tax developments in di3erent countries and implement appropriate tax planning strategies based on changes in tax laws. HCL also makes advance transfer pricing arrangements in several countries and has the transfer pricing arrangements reviewed by external consultants periodically.

Foreign Exchange Risks

HCL derives the majority of its revenues from clients based outside India and accordingly more than 97 percent of its revenues is realized in foreign currencies. Its delivery teams are also based across various countries, and more than 72 percent of the company’s costs are denominated in foreign currencies. This exposes the company to any adverse movement in foreign currency exchange rates. HCL manages this risk by using foreign exchange forward contracts and options to mitigate the risk of movements in foreign exchange rates associated with receivables and forecast transactions in certain foreign currencies. This is governed by policy and processes determined by the Board, which defines the period of hedges, the percentage of risk to be covered, and the counterparty risk to be taken.

Consolidated Results

This part of the Management Discussion and Analysis refers to the consolidated financial statements of HCL ("the Company" or "the Parent Company") and its subsidiaries referred to as "the Group". The discussion should be read in conjunction with the financial statements and related notes to the consolidated accounts of HCL for the year ended 31 March 2021, prepared in accordance with the Indian Accounting Standard (referred to as "Ind AS"), prescribed under Section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standard) rules as amended from time to time.

Performance Trends

Revenue has increased from Rs.50,569 Crores in FY18 to Rs.75,379 Crores in FY21, with a compounded annual growth rate (CAGR) of 14.2 percent over the last three years.

The net worth of the Company has increased from Rs.36,386 Crores in FY18 to Rs.59,913 Crores in FY21, with a compounded annual growth rate (CAGR) of 18.1 percent over the last three years.

Financial Performance

Results of Operations (Consolidated):

(in Crores)

Year Ended
31 March 2021

31 March 2020

Particulars Amount % Revenue Amount % Revenue % Increase
Revenues from operations 75,379 100.0% 70,676 100.0% 6.7%
Other income 927 1.2% 589 0.8% 57.4%
Total income 76,306 101.2% 71,265 100.8% 7.1%
Purchase of stock-in-trade 1,698 2.3% 1,536 2.2% 10.5%
Changes in inventories of stock-in-trade (3) 0.0% 0.0%
Employee benefit expense 38,853 51.5% 34,928 49.4% 11.2%
Finance costs 511 0.7% 505 0.7% 1.2%
Depreciation, amortization and impairment expense 4,611 6.1% 3,420 4.8% 34.8%
Outsourcing costs 10,158 13.5% 10,700 15.1% (5.1%)
Other expenses 4,625 6.1% 6,196 8.8% (25.4%)
Total expenses 60,453 80.2% 57,285 81.0% 5.5%
Profit before tax 15,853 21.0% 13,980 19.8% 13.4%
Tax expense:
Current tax 3,719 4.9% 2,821 4.0%
Deferred tax charge 965 1.3% 102 0.1%
Total tax expense 4,684 6.2% 2,923 4.1% 60.2%
Profit after tax 11,169 14.7% 11,057 15.7% 1.0%
Non-controlling interest (24) 0.0%
Profit for the year 11,145 14.7% 11,057 15.7% 0.8%


Revenues from operations

Comprises revenue from sale of services and the sale of hardware and software.

Revenue from operations in the year ended 31 March 2021 increased by 6.7 percent to Rs.75,379 Crores from Rs.70,676 Crores in the year ended 31 March 2020. This increase is mainly due to business growth in the IT and Business Services (ITBS) segment and Products & Platforms (P&P) segment. The growth of our ITBS business was strong in a post-pandemic world due to accelerated global enterprise demand for digital transformation programs, including zero-touch client interactions and remote workforce management solutions like digital workplace, cybersecurity etc. The growth also resulted from ongoing technology programs like hybrid cloud adoption, cost optimization initiatives, and tail vendor consolidation programs. The growth in the P&P segment was primarily due to the full-year impact of the acquisition of select IBM software products, which was consummated on 30 June 2019.

The following table sets forth the revenue generated from each of our business segments and their respective percentage of our total revenue for the year indicated:

(in Crores)

Year Ended
31 March 2021 31 March 2020
Particulars Amount % of total Amount % of total % Increase
IT and Business Services 53,401 70.8% 50,742 71.8% 5.2%
Engineering and R&D services 11,745 15.6% 11,819 16.7% (0.6%)
Products & Platforms 10,233 13.6% 8,115 11.5% 26.1%
Total Revenue 75,379 100.0% 70,676 100.0% 6.7%

Geographic breakup of revenues

The Group also reviews its business on a geographic basis. The following table classifies total revenue by geographic areas:

(in Crores)

Year Ended
31 March 2021 31 March 2020
Geographical Mix Amount % of total Amount % of total % Increase
America 42,468 56.4% 40,798 57.8% 4.1%
Europe 20,884 27.7% 19,397 27.4% 7.7%
India* 2,297 3.0% 2,354 3.3% (2.4%)
Rest of the world 9,730 12.9% 8,127 11.5% 19.7%
Total Service Revenue 75,379 100.0% 70,676 100.0%

* includes revenue billed to India based captive of global customers

Other Income

The details of Other Income are as follows:

(in Crores)

Year Ended

Other Income 31 March 2021 31 March 2020 % Increase
Interest Income 648 466
Profit on sale of investments carried at fair value through other comprehensive income 3 16
Income on investments carried at fair value through profit and loss
– Income from mutual funds 92 123
– Share of profit in limited liability partnership 10 1
– Fair value changes on equity instruments (5) (30)
Profit on sale of property, plant and equipment 102
Exchange di3erences (net) 46
Others 31 13
Total 927 589 57.2%

Other income increased by 57.2 percent to 927 Crores in the year ended 31 March 2021 from 589 Crores in the year ended 31 March 2020. This increase is mainly due to

(a) profit on the sale of property, plant and equipment of 102 Crores and

(b) an increase in interest income of 182 Crores due to additional investments made during the year from the cash flows generated by operations.


Purchases of stock-in-trade

Purchases of stock-in-trade increased by 10.5 percent to 1,698 Crores in the year ended 31 March 2021 from 1,536 Crores in the year ended 31 March 2020. This increase is mainly due to higher sale of hardware and software.

Employee benefits expense and outsourcing costs

"Employee benefit expense" includes salaries, which have fixed and variable components, and contributions to retirement and pension schemes. It also includes expenses incurred on sta3 welfare.

(in Crores)

Year Ended
31 March 2021

31 March 2020

Particulars Amount % Revenue Amount % Revenue % Increase
Salaries, wages and bonus 34,090 45.1% 30,599 43.3% 11.4%
Contribution to provident fund and other employee benefits 4,574 6.1% 4,185 5.9% 9.3%
Sta3 welfare expenses 189 0.3% 144 0.2% 31.3%
Total 38,853 51.5% 34,928 49.4% 11.2%

Employee benefits expense has increased by 11.2 percent to 38,853 Crores in the year ended 31 March 2021 from

34,928 Crores in the year ended 31 March 2020. The increase is mainly due to

(a) a one time special bonus of 728 Crores paid to employees in recognition of the Group achieving the $10B revenue mark in 2020,

(b) an increase in the number of employees (168,977 as at 31 March 2021 as compared to 150,423 as at 31 March 2020) and

(c) an increase in the average cost per employee due to normal salary revisions.

Finance costs

"Finance costs" comprises interest on loans from banks, interest on a loan from senior notes issued on the Singapore stock exchange, interest on lease liabilities, interest on direct taxes, other interest, fair value changes on liabilities carried at fair value through profit and loss, and bank charges.

Finance costs marginally increased by 1.2 percent to 511 Crores in the year ended 31 March 2021 from 505 Crores in the year ended 31 March 2020.

Depreciation, amortization, and impairment expenses

Depreciation, amortization, and impairment expenses increased by 34.8 percent to 4,611 Crores in the year ended 31 March 2021 from 3,420 Crores in the year ended 31 March 2020. This increase is mainly due to (a) increase in depreciation by 213 Crores on computers and networking equipment and (b) amortization by 617 Crores on customer relationship, 191 Crores on licensed IPRs (including impairment of 116 Crores), and 79 Crores on technology. The higher charge on customer relationship and technology is due to the full year impact of acquisitions consummated during the previous year; the higher amortization charge on licensed IPRs is due to new licensed IPRs acquired during the year.

Outsourcing expenses

"Outsourcing expenses" include (a) outsourcing of several customer-related activities such as hosting services, facilities management, disaster recovery, maintenance and break fix services and (b) hiring of third-party consultants from time to time to supplement the in-house teams.

Outsourcing expenses decreased by 5.1 percent to 10,158 Crores in the year ended 31 March 2021 from 10,700 Crores in the year ended 31 March 2020. This decrease is mainly due to rebadging of certain customer employees, which resulted in the transfer of such customer employees from our customers’ payroll to our payroll which in turn resulted in the shifting of costs from outsourcing costs to employee benefit expenses.

Other expenses

(in Crores)

Year Ended
31 March 2021

31 March 2020

Particulars Amount % Revenue Amount % Revenue % Increase
Software license fee 1,071 1.4% 902 1.3% 18.7%
Repairs and maintenance 644 0.9% 722 1.0% (10.8%)
Legal and professional charges 597 0.8% 553 0.8% 8.0%
Communication costs 457 0.6% 364 0.5% 25.5%
Travel and conveyance 362 0.5% 1,849 2.6% (80.4%)
Power and fuel 275 0.4% 307 0.4% (10.4%)
Expenditure toward corporate social responsibility activities 197 0.3% 178 0.3% 10.7%
Insurance 105 0.1% 85 0.1% 23.5%
Rent 83 0.1% 99 0.1% (16.2%)
Others 834 1.1% 1,137 1.6% (26.6%)
Total 4,625 6.1% 6,196 8.8% (25.4%)

Other expenses decreased by 25.4 percent to 4,625 Crores in the year ended 31 March 2021 from 6,196 Crores in the year ended 31 March 2020. Reduction in costs is primarily due to lower travel and conveyance expenditures incurred by the Company during the current year, which was impacted by the spread of the COVID-19 pandemic.

Tax expenses

"Tax expenses" comprises current tax and deferred tax.

(in Crores)

Particulars 31 March 2021 31 March 2020
Profit before tax 15,853 13,980
Total tax expense 4,684 2,923
E3ective tax rate 29.5% 20.9%

Tax expenses include current tax and deferred tax expense. The e3ective tax rate ("ETR") for the year ended 31 March 2021 has increased mainly due to deferred tax expense of Rs.1,222 Crores, being the deferred tax liabilities recognized by the Company on the di3erence between book basis and tax basis of goodwill consequent upon enactment of new tax provision discontinuing the amortization of goodwill for tax purposes w.e.f. 1 April 2020.

Financial position

(in Crores)

Particulars 31 March 2021 31 March 2020
(a) Property, plant and equipment 5,642 5,494
(b) Capital work in progress 312 400
(c) Right-of-use assets 2,410 2,648
(d) Goodwill 17,192 16,154
(e) Other intangible assets 11,901 13,194
(f) Other non-current assets 5,686 6,596
(g) Current assets 43,051 38,420
Total assets 86,194 82,906
(a) Equity share capital 543 543
(b) Other equity 59,539 50,878
Total equity 60,082 51,421
(a) Non-current liabilities 8,729 7,755
(b) Current liabilities 17,383 23,730
Total equity and liabilities 86,194 82,906

"Other equity" comprises other equity attributable to shareholders of the Company and non-controlling interest.

Property, plant and equipment and capital work in progress

Property, plant and equipment net of depreciation as at year ended 31 March 2021 was 5,642 Crores (compared with 5,494 Crores as at 31 March 2020). The increase was primarily due to addition of 1,610 Crores (mainly computer and networking equipment is 1,227 Crores, and balance other assets) o3set by depreciation for the year of 1,419 Crores.

Capital work in progress as at year ended 31 March 2021 is 312 Crores (compared with 400 Crores as at the year ended 31 March 2020).

Right-of-use assets

Right-of-use assets as at year ended 31 March 2021 is 2,410 Crores (compared with 2,648 Crores as at 31 March 2020).

Goodwill and intangible assets

Goodwill as at year ended 31 March 2021 is 17,192 Crores (compared with 16,154 Crores as at 31 March 2020). The increase was primarily due to addition of 1,034 Crores for acquisitions consummated during the year (for details refer to Note 2 to the consolidated financial statement).

Intangible assets as at year ended 31 March 2021 is 11,901 Crores (compared with 13,194 Crores as at 31 March 2020). The decrease was primarily due to amortization of 2,504 Crores, o3set by the addition of licensed IPRs of 769 Crores and other intangible assets of 456 Crores acquired through acquisitions consummated during the year.

Treasury investments

The guiding principles of the Group’s treasury investments are safety, liquidity and return. The Group has e3ciently managed its surplus funds through careful treasury operations.

The Group deploys its surplus funds in fixed deposits with banks, inter-corporate deposits, and investments in debt mutual funds and debt securities, with a limit on investments in any individual bank/fund.

Breakup of treasury investments is given below

(in Crores)

Particulars 31 March 2021 31 March 2020
Debt Mutual Funds 1,024 3,298
Debt Securities 5,749 3,691
Deposits with Banks 5,277 968
Deposits with HDFC Limited, Bajaj Finance and LIC Housing Finance 4,841 3,420
Total 16,891 11,377

Current and other non-current assets excluding Treasury investments

"Other non-current assets" comprises deferred tax assets (net), and non-current financial and other assets. "Current assets" comprises inventories, current tax assets (net), and current financial and other current assets.

(in Crores)

Particulars 31 March 2021 31 March 2020
Other non-current assets 5,686 6,596
Current assets 43,051 38,420
Total 48,737 45,016
Less: Treasury investments 16,891 11,377
Total 31,846 33,639

Current and other non-current assets, excluding treasury investments, decreased by Rs.1,793 Crores to Rs.31,846 Crores in the year ended 31 March 2021 from Rs.33,639 Crores in the year ended 31 March 2020. The decrease is primarily due to decrease in deferred tax assets of Rs.1,136 Crores. This decrease was primarily due to Deferred Tax Liabilities of Rs.1,222 Crores recognized by the Company on the di3erence between book basis and tax basis of goodwill consequent upon enactment of new tax provision discontinuing the amortization of goodwill for tax purposes w.e.f. 1 April 2020; and a decrease in other receivables of Rs.777 Crores and trade receivables of Rs.468 Crores, which was partly o3set by an increase in finance lease receivables of Rs.579 Crores, deferred contract cost of Rs.239 Crores, and unbilled receivables of Rs.136 Crores.

Shareholders’ Fund

During the financial year, pursuant to the Scheme of Amalgamation e3ective 13 July 2020 between the Company and its four wholly owned subsidiaries, the authorized share capital of the erstwhile Transferor Companies aggregating to 3,40,00,000/- has been clubbed with the authorized share capital of the Company. Consequently, as on 31 March 2021, the authorized share capital of the Company was 603 Crores divided into 3,01,70,00,000 equity shares of face value of 2 each.

The equity attributable to shareholders of the Company was Rs.59,913 Crores as of the year ended 31 March 2021 (compared with Rs.51,267 Crores as of the year ended 31 March 2020). The increase is primarily due to profit during the year of Rs.11,169 Crores, partly netted o3 by payment of a dividend of Rs.3,257 Crores.


(in Crores)

Particulars 31 March 2021 31 March 2020
Long-term borrowings
– From banks 207 2,848
– From senior notes 3,621
Short-term borrowings 1,845
Current maturities of long-term borrowings 79 399
Total 3,907 5,092

Borrowing of the Group has decreased by 1,185 Crores to 3,907 Crores in the year ended 31 March 2021 from 5,092 Crores in the year ended 31 March 2020.

On 10 March 2021, the Group issued USD 500 million in unsecured senior notes due 2026 (the ‘Notes’) for 3,656 Crores. The Notes will bear interest at a rate of 1.375 percent per annum and will mature on 10 March 2026. Interest on the Notes will be paid semi-annually on 10 March and 10 September of each year, commencing 10 September 2021. The Notes are listed on Singapore Exchange Securities Trading Limited (SGX-ST). The Notes are issued at a price of 99.510 percent and have an e3ective interest rate of 1.58 percent per annum after considering the issue expenses and discount of 35 Crores. A significant portion of these funds has been used for repayment of long-term and short-term borrowings from banks.

Non-current and current liabilities

"Non-current liabilities" comprises non-current provisions, deferred tax liabilities (net), non-current financial and other liabilities.

"Current liabilities" comprises current provisions, current tax liabilities (net), current financial and other liabilities.

(in Crores)

Particulars 31 March 2021 31 March 2020
Non-current liabilities 8,729 7,755
Current liabilities 17,383 23,730
Less : Borrowings 3,907 5,092
Total 22,205 26,393

Current and non-current liabilities, excluding borrowings, decreased by Rs.4,188 Crores to Rs.22,205 Crores in the year ended 31 March 2021 from Rs.26,393 Crores in the year ended 31 March 2020. The decrease is primarily due to payment of Deferred consideration of Rs.6,488 Crores related to acquisition of select IBM Software products partly o3set by an increase in trade payables of Rs.560 Crores, provision for employee benefits of Rs.542 Crores, contract liabilities of Rs.522 Crores, employee accrued cost of Rs.532 Crores and capital account payable of Rs.374 Crores.

Cash Flows

A summary of the cash flow statement is given below:

(in Crores)

Year Ended
31 March 2021 31 March 2020
Net cash generated from operating activities (A) 19,618 13,359
Net cash used in investing activities (B) (5,742) (12,374)
Net cash flows used in financing activities (C) (11,180) (3,168)
Net increase (decrease) in cash and cash equivalents (A+B+C) 2,696 (2,183)
Cash and cash equivalents at the end of the year (see note below) 6,521 3,760

Note: "Cash and cash equivalents at the end of the year" consists of the following for the purpose of the cash flow statement:

(in Crores)

Year Ended
31 March 2021 31 March 2020
Cash and cash equivalents 6,521 4,848
Bank overdraft (1,088)
Cash and cash equivalents as per cash flow statements 6,521 3,760

Net cash flow from operating activities

Net cash generated from operating activities was 19,618 Crores during the year ended 31 March 2021, consisting of profit before tax of 15,853 Crores, adjusted for

(a) non-cash and non-operating items, which are mainly depreciation, amortization and impairment expenses of 4,611 Crores, and interest income of (645) Crores, and

(b) cash flow from net working capital of 3,041 Crores, which was primarily driven by movement in financial and other assets and liabilities; and cash used to pay taxes (net of refund) of 3,445 Crores.

Net cash generated from operating activities was 13,359 Crores during the year ended 31 March 2020, consisting of profit before tax of 13,980 Crores, adjusted for

(a) non-cash and non-operating items which are mainly depreciation and amortization of 3,420 Crores, and interest income of (441) Crores, and

(b) cash used in net working capital of 1,560 Crores which was primarily driven by movement in financial and other assets and liabilities; and cash used to pay taxes (net of refund) was 2,558 Crores.

Net cash flows used in investing activities

Net cash used in investing activities was 5,742 Crores for the year ended 31 March 2021. This primarily consisted of the net amount of placement and maturity/redemption of bank and corporate deposits of 3,661 Crores, payment for business acquisitions of 1,211 Crores, and net amount of purchase and sale of property, plant and equipment and intangibles of 1,753 Crores, partially o3set by proceeds from the sale and purchase of mutual funds and debt securities of 317 Crores (net).

Net cash used in investing activities was 12,374 Crores for the year ended 31 March 2020. This primarily consisted of payment for business acquisitions of 6,091 Crores, net amount of purchase and sale of mutual funds and debt securities of 4,635 Crores, and net amount of purchase and sale of property, plant and equipment and intangibles of 1,829 Crores, partially o3set by proceeds from bank and corporate deposits on maturity/redemption of 55 Crores.

Net cash flow used in financing activities

Net cash used in financing activities was 11,180 Crores for the year ended 31 March 2021, primarily consisting of the payment of deferred and contingent consideration of 6,518 Crores, payment of dividends including corporate dividend tax of 3,256 Crores as well as payment of lease liabilities including interest of 1,016 Crores.

Net cash used in financing activities was 3,168 Crores for the year ended 31 March 2020, primarily consisting of the payment of dividends including corporate dividend tax of 1,625 Crores as well as payment of lease liabilities including interest of 866 Crores.

Key Financial Ratio

Year Ended

Units 31 March 2021 31 March 2020
Profitability Ratios
– Operating Profit Margin % 20.5 19.7
– Net Profit Margin % 14.7 15.7
– Return on Net Worth % 20.1 23.9
Liquidity Ratio
– Current Ratio Times 2.5 1.6
Management E3ciency Ratio
– Debtors Turnover Ratio Times 5.4 5.5
– Inventory Turnover Ratio Times 18.2 16.9
Leverage Ratio
– Interest Coverage Ratio – Borrowings Times 128.8 106.1
– Debt Equity Ratio Times 0.1 0.1

In addition to return on net worth, variations have been explained for ratios with significant variations.

Return on Net Worth

Return on net worth is at 20.1 percent in FY21 as compared to 23.9 percent in FY20. Finance Bill 2021 was enacted in March 2021, whereby goodwill was taken out from depreciable assets w.e.f. 1 April 2020. This change has required the Company to record a one-time non-cash deferred tax of 1,222 Crores. Also during the current year, the Company has paid a one-time special bonus amounting to 728 Crores (net of tax 575 Crores) to employees in recognition of the Group achieving the $10B revenue mark in 2020. Both these one-time costs had an adverse impact of 2.9 percent points on Return on Net Worth.

Current Ratio

Current ratio has increased from 1.6 times in FY20 to 2.5 times in FY21 primarily due to payment of deferred consideration on the acquisition of select IBM software products during the year.

Standalone Results

Standalone results of HCL excludes the performance of its subsidiaries.

The discussion in the paragraphs which follow should be read in conjunction with the financial statements and related notes relevant to the standalone results of HCL Technologies Limited (herein referred to as "HCL" or "the Company") for the year ended 31 March 2021, prepared in accordance with the Indian Accounting Standard (referred to as "Ind AS"), prescribed under Section 133 of the Companies Act, 2013, read with the Companies (Indian Accounting Standard) rules as amended from time to time.

The Hon’ble National Company Law Tribunal (NCLT) of New Delhi and Bengaluru have approved the Scheme of Amalgamation providing for the merger of four direct/step-down wholly-owned subsidiaries engaged in providing IT and IT related services viz. HCL Eagle Limited, HCL Comnet Limited, HCL Technologies Solutions Limited and Concept2Silicon Systems Private Limited (the "Transferor companies") with and into HCL Technologies Limited (the "Transferee company") with e3ect from 01 April 2019, the appointed date. The scheme has become e3ective on 13 July 2020 on filing of the certified true copy of the Orders of the Delhi and the Bengaluru NCLT with the Registrar of Companies on 13 March 2020 and 13 July 2020, respectively. Since the Transferor Companies are the wholly-owned subsidiaries of the Transferee Company, there will be no issue and allotment of shares as consideration. The di3erence between the amounts recorded as investments of the Company (Transferee Company) and the amount of share capital of the aforesaid amalgamating subsidiaries (Transferor Companies) has been adjusted in the Common Control Transaction Capital Reserve. The comparative results have been restated for all periods presented as per guidance under Appendix C of Ind AS 103 "Business Combinations".

The impact of the scheme is not material on the standalone financial results of the company.

Results of Operations (Standalone)

(in Crores)

Year Ended
31 March 2021

31 March 2020

Particulars Amount % Revenue Amount % Revenue % Growth
Revenue from operations 35,673 100.0% 32,666 100.0% 9.2%
Other income 965 2.7% 613 1.9% 57.4%
Total income 36,638 102.7% 33,279 101.9% 10.1%
Expenses :
Purchase of stock-in-trade 142 0.4% 151 0.5% (6.0%)
Change in inventories of stock-in-trade (3) 0.0% 3 0.0%
Employee benefit expense 11,749 32.9% 9,955 30.5% 18.0%
Finance cost 177 0.5% 240 0.7% (26.3%)
Depreciation, amortisation and
impairment expense 2,813 7.9% 1,959 6.0% 43.6%
Outsourcing costs 7,515 21.1% 7,215 22.1% 4.2%
Other expenses 1,835 5.1% 2,578 7.9% (28.8%)
Total Expenditure 24,228 67.9% 22,101 67.7% 9.6%
Profit before tax 12,410 34.8% 11,178 34.2% 11.0%
Tax expense:
Current tax 2,480 7.0% 1,968 6.0% 26.0%
Deferred tax charge 1,187 3.3% 241 0.7%
Total tax expense 3,667 10.3% 2,209 6.7% 66.0%
Profit after tax 8,743 24.5% 8,969 27.5% (2.5%)

Financial Position (Standalone)

(in Crores)

31 March 2021 31 March 2020
(a) Property, plant and equipment 3,608 3,549
(b) Capital work in progress 245 311
(c) Right-of-use assets 894 1,036
(d) Goodwill 6,549 6,418
(e) Other intangible assets 9,854 11,640
(f) Other non-current assets 6,497 7,040
(g) Current assets 27,714 23,844
Total assets 55,361 53,838
(a) Equity share capital 543 543
(b) Other equity 43,010 37,003
Total equity 43,553 37,546
(a) Non-current liabilities 1,789 2,287
(b) Current liabilities 10,019 14,005
Total equity and liabilities 55,361 53,838

Current and other non-current assets excluding Treasury investments

"Other non-current assets" comprises deferred tax assets (net), non-current financial and other assets.

"Current assets" comprises inventories, current tax assets (net), current financial and other current assets.

(in Crores)

Particulars 31 March 2021 31 March 2020
Other non-current assets 6,497 7,040
Current assets 27,714 23,844
Total 34,211 30,884
Less: Treasury investments 16,334 11,053
Total 17,877 19,831

Current and other non–current assets, excluding treasury assets, decreased by 1,954 Crores to 17,877 Crores in the year ended 31 March 2021 from 19,831 Crores in the year ended 31 March 2020; the decrease is primarily due to decrease in trade receivables of 2,308 Crores, deferred tax assets (net) of 1,362 Crores (primarily due to Deferred Tax Liabilities of 1,222 Crores recognized by the Company on the di3erence between book basis and tax basis of goodwill consequent upon enactment of new tax provision discontinuing the amortization of goodwill for tax purposes w.e.f. 1 April 2020), partly o3set by increase in unbilled receivable by 2,072 Crores.

Non-current and current liabilities

"Non-current liabilities" comprises of non-current provisions, deferred tax liabilities (net), and non-current financial and other liabilities.

"Current liabilities" comprises of current provisions, current tax liabilities (net), and current financial and other liabilities.

(in Crores)

Particulars 31 March 2021 31 March 2020
Non-current liabilities 1,789 2,287
Current liabilities 10,019 14,005
Less: Borrowings 225 181
Total 11,583 16,111

Current and non-current liabilities, excluding borrowings, decreased by 4,528 Crores to 11,583 Crores in the year ended 31 March 2021 from 16,111 Crores in the year ended 31 March 2020; the decrease is primarily due to payment of Deferred consideration of 6,197 Crores related to acquisition of select IBM Software products, partly o3set by an increase in Contract liabilities of 860 Crores, liabilities for expenses of 648 Crores and trade payables of 435 Crores.

Cash Flows (Standalone)

A summary of the cash flow statement is given below:

(in Crores)

Year Ended
31 March 2021 31 March 2020
Net cash generated from operating activities (A) 15,765 9,911
Net cash flows used in investing activities (B) (4,548) (11,140)
Net cash flows used in financing activities (C) (9,649) (1,997)
Net increase / (decrease) in cash and cash equivalents (A+B+C) 1,568 (3,226)
Cash and cash equivalents at the end of the year 2,876 1,294

Net cash flow from operating activities

Net cash generated from operating activities was 15,765 Crores during the year ended 31 March 2021, consisting of profit before tax of 12,410 Crores, adjusted for

(a) non-cash and non-operating items, which are mainly depreciation and amortization expenses of 2,813 Crores, and interest income of (551) Crores, and

(b) cash flow from net working capital of 3,530 Crores, which was primarily driven by movement in financial and other assets and liabilities; and cash used to pay taxes (net of refund) of 2,350 Crores.

Net cash generated from operating activities was 9,911 Crores during the year ended 31 March 2020, consisting of profit before tax of 11,178 Crores, adjusted for (a) non-cash and non-operating items, which are mainly depreciation and amortization of 1,959 Crores, and interest income of (426) Crores, and (b) cash used in net working capital of

1,205 Crores, which was primarily driven by movement in financial and other assets and liabilities; and cash used to pay taxes (net of refund) of 1,705 Crores.

Net cash flows used in investing activities

Net cash used in investing activities was 4,548 Crores for the year ended 31 March 2021. This primarily consisted of the net amount of placement and maturity/redemption of bank and corporate deposits of 3,602 Crores, investment in subsidiaries of 887 Crores, net amount of purchase and sale of property, plant and equipment and intangibles of 685 Crores and payment for business acquisitions of 367 Crores, partially o3set by interest received of 585 Crores and proceeds from net of purchase and sale of mutual funds of 408 Crores.

Net cash used in investing activities was 11,140 Crores for the year ended 31 March 2020. This primarily consisted of payment for business acquisitions of 5,340 Crores, net amount of purchase and sale of mutual funds and debt securities of Rs.4,619 Crores, and net amount of purchase and sale of property, plant and equipment and intangibles of 929 Crores, partially o3set by proceeds from bank and corporate deposits on maturity/redemption of 5 Crores.

Net cash flow used in financing activities

Net cash used in financing activities was ? 9,649 Crores for the year ended 31 March 2021, primarily consisting of the payment of deferred consideration of ? 6,216 Crores, payment of dividends of ? 3,256 Crores, as well as the payment of lease liabilities, including interest of ? 217 Crores.

Net cash used in financing activities was ? 1,997 Crores for the year ended 31 March 2020, primarily consisting of the payment of dividends, including corporate dividend tax of ? 1,625 Crores as well as payment of lease liabilities including interest of K198 Crores.

Key Financial Ratio (Standalone)

Units Year Ended 31 March 2021 31 March 2020
Profitability Ratios
- Operating Profit Margin % 32.6 33.1
- Net Profit Margin % 24.5 27.5
- Return on Net Worth % 21.6 26.3
Liquidity Ratio
- Current Ratio Times 2.8 1.7
Management Efficiency Ratio
- Debtors Turnover Ratio Times 5.6 4.7
- Inventory Turnover Ratio Times 8.7 9.6
Leverage Ratio
- Interest Coverage Ratio - Borrowings Times 3,103.5 932.5
- Debt Equity Ratio Times 0.0 0.0

In addition to return on net worth, variations have been explained for ratios with significant variations.

Return on Net Worth

Return on Net Worth is at 21.6 percent in FY21 as compared to 26.3 percent in FY20. Finance Bill 2021 was enacted in March 21, whereby goodwill was taken out from depreciable assets w.e.f. 1 April 2020. This change has required the Company to record a one-time non-cash deferred tax of ? 1,222 Crores. Also during the current year, the Company has paid one-time special bonus amounting to ? 243 Crores (net of tax ? 192 Crores) to employees in recognition of the Group achieving the $10B revenue mark in 2020. Both these one-time costs had an adverse impact of 3.0 percent points on Return on Net Worth.

Current Ratio

Current ratio has increased from 1.7 times in FY20 to 2.8 times in FY21 primarily due to payment of deferred consideration on the acquisition of select IBM software products during the year.

Interest Coverage Ratio

Interest coverage ratio has increased during the year mainly due to reduction in interest cost.