HCL Technologies witnessed 14% growth in FY 2017 and continued to perform steadily in double digits in rupee terms. Like the entire services sector, the company is also facing challenges from digitalization and automation. Contributing to its woes has been the policies of the Donald Trump administration which tightened the noose on outsourcing and barred foreign workers for entry level jobs in the IT industry. The decision of the Trump administration is expected to affect the top line in the coming year as the locals come at a hefty price for Indian companies in the US.
HCL Technologies witnessed a few key changes in its management in FY 17. One among them has been the exit of Anant Gupta from CEO’s post. Gupta was replaced by C Vijayakumar, an existing HCL veteran who’ve been at the helm of affairs at different levels in the company. Gupta moved out to try his luck in his own venture that will focus on startup innovation.
C Vijaykumar is known for his grip on the US market and strengthening relations with clients. Under his leadership, HCL has been able to meet the forecasts due to increased deals even though the deal sizes have been low. The company has witnessed greater traction in digital technologies such as cloud, IoT and IP-based offerings.
HCL also saw significant opportunity in its lifesciences and healthcare verticals. However, healthcare in the US is right now a sticky issue with President Donald Trump’s administration mulling a repeal of the Obama administration’s health care law called Obamacare. It might affect the company’s business. A number of projects which were stalled in the past also picked up pace in this year and helped the company move forward.
In the Q4 earnings call the company’s CEO said: “From an industry sector perspective, FY’17 saw four of our key verticals deliver a doubledigit growth — Public Services grew by 31.3%; Retail CPG grew by 21.4%; Life Sciences and Healthcare 11.1% and Manufacturing by 17%. The remaining two verticals also recorded good growth. Telecom, Media and Entertainment grew 5.8% followed by Financial Services at 4.9%. In terms of geographies, America recorded 15% YoY growth, Europe and rest of the world recorded 18% YoY growth.
In terms of service lines, Infrastructure grew by whopping 27.4%, Engineering Services grew by 11.7% and Applications Services grew by close to 6%. Over the year, HCL also successfully established our clientpartner program to deliver “One HCL to Top 150 Client Partner Accounts” This initiative is successful and HCL is seeing good traction in pipelines as well as bookings in the cross-sell opportunities. This year also saw the company emerge as the fastest growing IT Services brand in the world as testified by Brand Finance Survey. The company’s brand value increased by 38% over last year.
—C VIJAYAKUMAR CEO