Shares of HCL Technologies jumped over 7 percent to Rs 1,587 on April 23 after the IT giant posted January–March quarter (Q4FY25) results that were largely in line with expectations. While most brokerages maintained a neutral stance, they acknowledged that the company’s FY26 revenue guidance came in slightly ahead of estimates. However, the management’s cautious outlook and a soft performance in new deal total contract values (TCVs) during Q4 tempered overall optimism.
Citi retained a "neutral" rating on HCL Tech, setting a target price of Rs 1,510 per share. The firm noted that HCL delivered a reasonably good performance in a seasonally weak quarter, especially when compared with peers. It also noted that it had adjusted its earnings per share (EPS) estimates for FY26 and FY27 downwards by 2 percent each, reflecting expectations of slower growth.
"The management highlighted an environment filled with uncertainty and stated that it would continue to explore new opportunities,” Citi said. Based on the guidance, the company is essentially forecasting flat growth (0 percent CAGR) across the quarters of FY26, which led analysts tweak their EPS projections for the next two years.
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On the other hand, Nuvama took a more optimistic view, maintaining a “buy” rating on the stock with a target price of Rs 1,700 per share. The brokerage pointed out that HCL Tech’s revenue growth guidance for FY26 was above their expectations, which supported their bullish stance.
Meanwhile, analysts at Morgan Stanley assigned an “equal-weight” rating to the stock, pegging their target price at Rs 1,600 per share
HCL Tech reported a 6 percent year-on-year (YoY) increase in revenue from operations, rising to Rs 30,246 crore in Q4FY25 compared to Rs 28,499 crore in the same quarter last year. Net profit for the quarter came in at Rs 4,307 crore, up 8 percent YoY.
For the full fiscal year FY25, revenue rose 6.5 percent, while net profit registered a growth of 10.8 percent. The company reported an EBIT margin of 18.3 percent, which was within the guided range of 18–19 percent.
However, HCL Tech revised its revenue growth guidance for FY26, projecting a 2–5 percent increase in constant currency (cc) terms. This reflects a downward revision at the lower end, trimming the earlier guidance by 250 basis points compared to FY25.
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