India’s third-largest IT company HCLTech on Thursday reported a strong earnings performance for the October-December quarter. The company’s net profit rose 17.4% quarter-on-quarter to Rs 4,096 crore. Its revenue from operations rose 8.2% q-o-q to Rs 26,700 crore, surpassing analysts estimates.
An earnings poll by Bloomberg estimated the company’s revenue to increase to Rs 26,049 crore, and net profit to Rs 3,813 crore.
The company’s growth during the quarter can be attributed to healthy cash conversions and strong performance in the services segment, especially the software products business which grew 31% sequentially in constant currency terms.
The company, however, lowered its FY23 revenue guidance to 13.5-14% from 13.5-14.5%. Similarly, the company lowered its Ebit margin guidance to 18-18.5% from 18-19%. A reason for the lowering of guidance is on expectation of increase in furloughs in the telecom and hi-technology sectors.
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During the quarter, the company’s margins calculated on earnings before interest and taxes (Ebit) rose 160 basis points sequentially to 19.6% from 18% in the September quarter.
“We have delivered a strong performance this quarter across all key metrics — revenue growth, margin expansion, booking growth and people metrics,” said C Vijayakumar, CEO & MD of the company.
In the quarter, the company won 17 large deals including seven from the services business and 10 from the software business.
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New deals for the quarter were worth $2.35 billion, slightly lower than $2.4 billion in the preceding quarter. The company net added 2,945 employees during the quarter. The rate of attrition for HCL Tech narrowed to 21.7% from 23.8% in the preceding quarter.