Sharekhan's research report on HCL Technologies
HCL Technologies surprised positively with outstanding revenue growth performance, but profitability missed our estimates; Q3 saw healthy deal bookings, strong hiring, good cash flow conversion and client additions. The management reiterated its earlier guidance of a double-digit CC revenue growth. However, it lowered EBIT margin guidance to 19% from 19-21% earlier, owing to higher attrition, investments & normalisation of product business margins. HCL Tech is expected to narrow gap versus large peers in terms of revenue growth in FY2023 given continued strength in services business, strong deal intake and improvement in growth profile of products business.
Outlook
We maintain a Buy on HCL Technologies with a revised PT of Rs. 1,550, given strong growth momentum in services business, leadership in ERD market, robust hiring and reasonable valuations.
More Info
At 16:00 hrs HCL Technologies was quoting at Rs 1,258.80, down Rs 78.75, or 5.89 percent.
It has touched an intraday high of Rs 1,276.00 and an intraday low of Rs 1,244.00.
It was trading with volumes of 567,053 shares, compared to its thirty day average of 230,852 shares, an increase of 145.63 percent.
In the previous trading session, the share closed up 0.32 percent or Rs 4.30 at Rs 1,337.55.
The share touched its 52-week high Rs 1,377.00 and 52-week low Rs 890.00 on 24 September, 2021 and 24 February, 2021, respectively.
Currently, it is trading 8.58 percent below its 52-week high and 41.44 percent above its 52-week low.
Market capitalisation stands at Rs 341,596.16 crore.
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