HCL Technologies Q2 profit up 7% at Rs 2,711 crore, raises FY20 revenue guidance to 15-17%

IT major HCL Technologies on Wednesday reported 6.9 per cent year-on-year (YoY) growth in consolidated net profit at Rs 2,711 crore for the second quarter ended September 30, 2019. The profit was 21.6 per cent higher compared to Rs 2.230 crore in the March quarter.

"The Noida-headquartered company had posted consolidated net profit of Rs 2,534 crore in the same quarter last year," HCL Technologies said in a filing to the Bombay Stock Exchange.

Consolidated revenue from operations grew by 18 per cent to Rs 17,527 crore in Q2FY20 as compared to Rs 14,860 crore in Q2FY19, helped by the acquisition of security and digital solution providers AppScan and BigFix from IBM in July. HCL Tech's revenue stood at Rs 16,427 crore in the June quarter.

During the quarter under review, operating margin or EBIT (Earnings before interest and tax) jumped 17.9 per cent YoY to Rs 2 3,497 crore.

In US dollar terms, HCL Tech's consolidated profit rose 5.5 per cent YoY to 376 million, while revenue jumped 18.4 per cent YoY to 2,486 million. EBIT surged 18.8 per cent to USD 496 million.

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The company has raised its revenue growth outlook to 15-17 per cent in constant currency for the financial year 2019-20, from its previous forecast of 14-16 per cent growth. The operating margin (EBIT) range is expected to be between 18.5-19.5 per cent.

HCL Tech said that it has added 3,223 jobs during the July-September period, taking total headcount to 147,123, from 143,900 at the end of June quarter. The attrition rate declined to 16.9 per cent as compared to 17.3 per cent during June quarter and 17.1 per cent in the year-ago period.

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"A wave of unprecedented disruption is underway and it is going to define the next era of business and technology landscape. The times are changing and newer ideas & opportunities are constantly evolving. Thus, it is imperative for us to work together with the larger ecosystem to develop sustainable solutions and contribute towards socio-economic and sustainable development for a better future," said Shiv Nadar, Chairman & Chief Strategy Officer, HCL Technologies.

"I am confident that this momentum combined with our diversified portfolio of services and software will deliver great value to our clients, our shareholders and most importantly, our employees," said C Vijayakumar, President & CEO, HCL Technologies.

The board of HCL Technologies has declared an interim dividend of Rs 2 per equity share on face value of Rs 2 per equity share of the company, for the financial year 2019-20. The board has also approved and recommended issue of one bonus share for every one equity share held by the equity shareholders of the company, subjected to requisite approval.

In a separate development, the company said it has appointed Shikhar Malhotra as an additional director on the board of the company with effective from October 22, 2019.

Ahead of Q2 results, shares of HCL Technologies closed 2.93 per cent higher at Rs 1,095.65 apiece on the BSE on Wednesday.

Edited by Chitranjan Kumar