Moneycontrol Bureau
Brokerage firm Nomura has retained its positive view on HCL Technologies despite the company sounding a cautious note on its March quarter margins because of cross currency pressure.
Tuesday evening the company informed stock exchanges that its margins would be impacted by 280 basis points because of the recent strength in the dollar.
"While the cross currency impact is slightly ahead of our calculation of 230 bps, we do not see this as a material incremental negative. We believe HCL Tech’s strong fundamentals and growth comfort should outweigh the margin cautiousness and we would look to add on dips," said the Nomura note, adding that HCL Tech would continue to grow faster than peers.
"We also have a high degree of comfort on HCLT being among the faster growing companies within tier-1 IT (around 14 percent USD revenue compounded growth over FY15-17F) by virtue of stronger positioning and higher contribution from faster growing service lines for the industry with around 58 percent of revenues coming from IMS, BPO and Engineering services and cheaper than peer group valuation at 14-15 times P/E on FY17F," the Nomura note said.
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