HCL Technologies rises 1% on acquisition of German based company

(Image: HCL)

Shares of HCL Technologies rose 1.5 percent intraday Wednesday as company is going to acquire a German based company.

The company has signed a definitive agreement to acquire Wolfsburg-based IT and engineering services provider, H&D International Group.

The acquisition is part of company’s long-term growth plan in Germany and this deal sees HCL attain significant in-country front office and delivery capabilities and will further enhance the company’s domain expertise in the global automotive sector, company said in release.

Ashish Gupta, Corporate Vice President at HCL Technologies said, "Germany is a critical market for HCL as we continue to expand our business in Europe. We feel the German market is at an inflection point and it is the right time for HCL to expand and make significant investments here."

According to Sharekhan the said acquisition will strengthen its presence in ERD space (contributes 24.1% of its total revenues).

The company’s CC growth guidance (9.5%-11.5%) for FY19 included 125bps from acquisitions in the pipeline.

The completion of transaction is expected to close in August 2018.

The H&D International Group is one of the largest IT service providers in the German automotive industry and operates in over 20 locations globally. The revenue for H&D International group stood at EUR 74.1 million in CY2017.

At 11:15 hrs HCL Technologies was quoting at Rs 921.60, up Rs 12.30, or 1.35 percent on the BSE.