HCLTech beats Q2 estimates riding on strong software biz
HCL Technologies Ltd on Friday reported a 12.9% jump in consolidated net profit for the quarter ended September 2023 to Rs 3,859 crore. The company’s revenue grew by 14.4% to Rs 26,477 crore on a year-on-year basis, boosted by strong growth in the software business.
Analysts polled by Refinitiv had estimated the company’s net profit at Rs 3,585 crore and revenue at Rs 25,362 crore for the quarter ended September 2023. This means the company has beaten analysts’ estimates for both profit and revenue.
The IT major’s earnings before interest, tax, depreciation, and amortization (EBITDA) for the September quarter came in at Rs 6,319 crore, up 13% from the previous year. Its EBITDA margin expanded to 23.9% compared to 23.5% in the year-ago period.
“HCLTech continued its growth momentum in the second quarter, reflecting robust demand in key verticals such as financial services, manufacturing, and life sciences,” the company said in a statement. “Our strong performance in software services and sustained focus on digital transformation initiatives, underpinned by a clear commitment to sustainability, positioned us favorably to navigate the current economic environment.”
The company’s constant currency revenue grew by 7% sequentially and 16.1% year-on-year. This indicates a strong underlying performance despite headwinds from the global macroeconomic environment.
HCLTech’s software business revenue rose 14% year-on-year, while services revenue was up by 15.5% during the September quarter. This shows that the company is effectively capturing the growth opportunity in the software market. The company also stated that it continues to invest heavily in areas such as cloud computing, artificial intelligence, and data analytics.
The company has been experiencing strong demand for its digital services in the key verticals such as financial services, manufacturing, and life sciences. HCLTech’s focus on these verticals has helped it secure lucrative deals and grow its market share.
“Our continued focus on emerging technologies and the investments made in R&D are enabling us to be a preferred partner for digital transformation and innovation. Our commitment to sustainability through our initiatives is making a positive impact on our stakeholders,” said C Vijayakumar, Chief Executive Officer & Managing Director, HCLTech.
With a strong growth trajectory, HCLTech is well-positioned to benefit from the long-term growth opportunity in the technology sector. The company’s focus on emerging technologies and commitment to innovation have positioned it as a key player in the industry. The results for the quarter show HCLTech’s resilience and adaptability in a changing economic landscape, highlighting the company’s strategic vision and future outlook.
Overall, HCLTech’s Q2 results have been strong and in line with the positive trends observed in the tech sector. The company is poised to continue its growth journey driven by a robust software business and its focus on key verticals.
