Hold HCL Technologies: target of Rs 1150: ICICI Securities

ICICI Securities recommended hold rating on HCL Technologies with a target price of Rs 1150 in its research report dated April 22, 2022.

Broker Research

April 22, 2022 / 23:00 IST

26 Aug, 2025 12:21

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ICICI Securities research report on HCL Technologies

HCLT’s results exhibited a similar theme as the last three quarters: strong services growth, margin performance impacted by weak Products business, and a healthy TCV. HCLT reported a miss on revenue growth at 1.1% QoQ CC (vs Isec: +1.5%). Miss was on account of 24% QoQ CC decline in Products and Platforms but Services (ITBS and ERS) posted strong growth of 5% QoQ CC. We would like to highlight that since last three quarters, Services business has consistently grown organically at 5.0% CC QoQ or higher (highest amongst Tier-I). Among Services, IT services posted strong growth of 5.2% QoQ and ER&D posted 4% QoQ CC growth. Q1 is a seasonally weak quarter because of pass-through of productivity benefits and HCLT expects Q1FY23 to be no different. HCLT has guided for 12-14 YoY CC growth for FY23, and we expect revenue growth of 13%/12.3% YoY USD in FY23/24.

Outlook

We maintain HOLD rating with multiple of 19x on FY24E EPS of Rs61 to arrive at a target price of Rs1,150 (prior: Rs1,177).

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