HCL Tech, the country’s third largest Indian IT firm missed estimates on the net profit and revenue front in its April-June quarter earnings. The company’s net profit at Rs 3,534 crore was down 11.2% sequentially. Revenues during the period was down 1.1% quarter-on-quarter to Rs 26,296 crore.
Earnings before interest and taxes (EBIT) during the quarter was Rs 4,460 crore against Rs 4,836 crore in the preceding quarter.
The company has maintained the guidance for the full financial year on both revenue and EBIT front. C Vijayakumar, CEO and MD, HCLTech, said, “We continue to maintain our revenue guidance of 6 – 8 % for FY24 in constant currency. And we continue to maintain our guidance for operating margin for FY24 that is between 18-19 %”.
He said that bookings for the last seven quarters have been in the range of $2 billion and above, but in the June quarter, bookings for the company fell to about $1.6 billion. The stress also got reflected in the number of $20 million clients that fell from 131 in the March quarter to 127 in June quarter.
The board of directors has declared an interim dividend of Rs 10 per equity share of Rs 2 each for the fiscal 24. The record date of July 20, 2023 is being fixed for the payment of the interim dividend. And the payment date of the said interim dividend shall be August 1, 2023.
The total headcount of the company declined marginally by 2,506 to 2,23,438 in June quarter. The company stated that it has not backfilled some of the positions left open after attrition. In contrast, the company’s net addition in the March quarter was 3,674.
The IT firm added 1,597 freshers in June quarter, the least in the last five quarters. Even the attrition is at 16.3% for June quarter, the least in the last five quarters.
Ramachandran Sundararajan, chief people officer, HCLTech, said, “Attrition level continues to be a positive story. We have taken a decision to defer our annual review by a quarter”. He added that the decision has been taken after taking past years’ hiring and compensations into consideration.
Sundararajan added that for the last two years the company has been making investments to add freshers who go through cycles of training before they get productive. Now that they are getting added to the company’s productive capacity, the company didn’t backfill positions left out of attrition.