HCL Tech net up 7.8% at Rs 2,070 cr

HCL Technologies, the fourth-largest IT company in India, on Tuesday posted a 7.8% jump in net profit at Rs 2,070 crore for the December quarter, helped by growth in public services business and infrastructure services. The stellar performance of HCL comes when its peers TCS and Infosys failed in the market. Revenues for HCL were up 14.2% at Rs 11,814 crore in the third quarter over the year-ago period. This is in line with the market expectation.

"We continue our robust financial performance with a revenue growth of 3% q-o-q in constant currency terms... We expect our 2016-17 revenues to be in the middle of this range,” said HCL Technologies President and CEO C Vijayakumar. HCL Technologies third quarter results for FY17 beat street estimates with US dollar revenue growth much ahead of what the markets had estimated. In dollar terms, the top line was higher by 11.4% at $1.74 billion while profits grew 5.2% to $306 million. The company also maintained that growth for FY17 will be in the range of 10% to 12%.

The US dollar revenue of TCS grew 0.3% and Infosys US dollar revenues declined by 1.4%. In dollar terms, the top line was higher by 11.4% at $1.74 billion while profits grew 5.2% to $306 million. The company has announced a dividend of Rs 6 per share. The Noida-based firm has maintained its revenue growth outlook of 12-14% for 2016-17 (based on average exchange rates for 2016-17) in constant currency. HCL Technologies' total headcount stood at 1,11,092 at the end of December 2016, with a gross addition of 8,467 people.

The attrition for IT services on LTM (last twelve months) basis stood at 17.9%. Commenting on the impact of new technologies like automation and artificial intelligence on future hiring, Vijayakumar said the headcount may grow only 5-6 per cent. "There is going to be some optimisation due to automation... Last 4 years, our revenues have grown at about 12 per cent CAGR, but headcount has grown only 6-7 per cent, which means it's non-linear. This year, we are growing at 12-14 per cent, but headcount may grow only 5-6 per cent," he said.

He maintained that hiring will be across categories, including laterals and freshers. HCL Technologies reported broad-based growth across all revenue segments with the Americas and Europe growing by 13.6 per cent and 17.6 per cent, respectively, year-on-year. For the quarter to December, HCL Technologies had cash and cash equivalents of Rs 2,214.5 crore. It signed nine transformational deals this quarter across service lines, industry verticals and geographies.