HCL TECH PROFIT DROPS 4% TO ~22 BN IN JANUARY-MARCH

HCL Technologies on Tuesday reported a 4.3 per cent decline in net profit to ~22.27 billion for the quarter ended March

31, 2018, against ~23.25 billion a year ago when there was a onetime benefit from tax reversal. The company expects a better deal pipeline in 2018-19, backed by digital services. The IT services firm has given a growth guidance in the range of 9.5 per cent to 11.5 per cent on constant currency basis for 2018-19, slightly lower than last year.

HCL Technologies has posted a decline of 4.3 per cent in net profit to ~22.27 billion for the March quarter, against ~23.25 billion in the year-ago period. The results were in line with Street estimates. The company expects a better deal pipeline in FY19, backed by digital services.

The company has given a growth guidance in the range of 9.5-11.5 per cent on constant currency basis for FY19, which is slightly lower than last year. This, however, is higher than Nasscom’s growth guidance of 79 per cent for the industry.

HCL’s Mode 1, which include

core services in areas of applications, infrastructure, and engineering, among others, grew 5.7 per cent, whereas Mode 2 (nextgeneration digital services) grew 29.4 per cent and Mode 3 (products and platforms) grew 68.3 per cent in FY18. Revenues grew 9.3 per cent to ~131.8 billion as compared to ~120.5 billion last year.

For FY18, net profit stood at ~87.80 billion and revenues at ~505.7 billion.

HCL President and Chief Executive Officer C Vijayakumar said the company had a strong performance in the quarter and annually, backed by broad-based growth across verticals, robust client additions and accelerated revenues from Mode 2 and 3 services.

At the end of March 2018, HCL’s employee count stood at 120,081. The headcount in US stood at 14,000, of which 60 per cent were locals. For FY19, the company plans to hire 12,000 graduates in India and 1,000 in rest of the world, of which 500 would be in US.

Chief Financial Officer Anil Chanana said the company had earmarked a capex plan of about $250 million.