HCL Tech shares dip 6 per cent, m-cap down by Rs 8,322 cr

HCL Technologies shares ended 6 per cent lower on Monday, wiping out Rs 8,322 crore from its market valuation, after the company posted 2.8 per cent fall in consolidated net profit for June quarter.

The stock slumped 5.94 per cent to settle at Rs 937.40 on the Bombay Stock Exchange. During the day, it lost 6.37 per cent to Rs 933.10. At the National Stock Exchange, shares of the company dipped 5.95 per cent to Rs 938.85 at close.

Following the decline in the stock, the company's market valuation plummeted by Rs 8,322.58 crore to Rs 1,31,796.42 crore.

India's fourth-largest software services firm earlier in the day reported a consolidated net profit of Rs 1,783 crore for the April-June quarter against Rs 1,834 crore in the year-ago period, on account of higher selling, general and administrative (SG&A) expenses.

The firm follows July-June as the fiscal year.

Kotak Securities Head of Private Client Group Research Dipen Shah said the results were lower than expectations, both on the revenues and margins front. "There was a significant miss on the margin front. The relatively higher utilisation rates coupled with the need to increase sales, marketing investments and investing in emerging businesses may continue to impact profitability in the short term," he added.

For the full year ended June 30, 2015, HCL Tech's net profit moved up 13.9 per cent to Rs 7,254 crore against Rs 6,369 crore in the previous year. Revenues rose 12.6 per cent to Rs 37,061 crore during the year compared with Rs 32,917 crore in 2013-14.