Forex losses drag down HCL Tech net to Rs 320 cr

Written by fe Bureaus | New Delhi | Updated: Oct 29 2009, 06:19am hrs
HCL Technologies, ranked among the countrys top five software services firms, on Wednesday reported a 10% decline in its net profit at Rs 320.1 crore for the quarter ended September 30 compared to the year-ago period. Forex losses, which were almost half of the companys net profit, pulled down HCL Techs profitability vis--vis its peers like Infosys Technologies, Wipro and TCS, which have reported positive numbers. On a sequential basis, the net profit was down 3.1%. HCLs forex losses during the quarter stood at Rs 151 crore compared to Rs 80 crore in the same period last year.

The company, which continues to maintain a cautious approach to the demand situation, reported revenues of Rs 3,031 crore, up 28% on a year-on-year basis and 4.2% sequentially. We definitely believe the worst is behind us, but not de-growth of some of our clients. So, we continue to remain cautious about future, said Vineet Nayar, CEO of HCL Technologies.

The companys share price on the Bombay Stock Exchange closed at Rs 313.50, down 1.91%. The company has decided to only hedge for the next four quarters in future. We have decided to take hedges no more than $500 million in future, which is around our total net flows for two quarters, said CFO Anil Chanana.

In line with other IT bigwigs, HCL Tech will give salary increments in the range of 0-10% to both its onsite and offshore employees effective October this year.

Chanana said that the salary hikes would lead to a 130 basis point impact on the companys margins for the next two quarters. At the end of the quarter, the company had 54,443 employees.