In the June quarter, HCL Tech's revenue and people strength sequentially moderated in line with the demand environment. The firm's rupee revenue for the quarter came in at ₹26,296 crore compared to ₹26,606 crore in the March quarter. The dollar revenue for the company was at $3,200 million as against $3,235 million quarter-on-quarter.
Catch all live updates of HCL Tech Q1 Results here
"HCL Tech continues to be a partner of choice for global enterprises and is well placed to leverage opportunities in emerging areas such as AI and allied technologies despite the challenging global macro environment," said Roshni Nadar Malhotra, Chairperson at HCL Tech.
Let's take a look at the key highlights of HCL Tech's Q1FY24 scorecard:
The numbers
The company's consolidated revenue from operations jumped by 12.06 per cent to ₹26,296 crore in Q1FY24, as against ₹23,464 crore in Q1 of FY23. However, revenue dipped marginally by 1.2 per cent on a sequential basis. HCL Tech's EBIT, or earnings before interest and tax, a key metric of profitability, came in at ₹4,438 crore as against ₹4,836 crore in the previous quarter.
Segment performance
With regards to segment-wise performance, HCL Tech's IT and business services revenue stood at ₹19,642 crore in Q1FY24, up by 15.06 per cent YoY. While engineering and R&D services revenue saw a single-digit growth of 3.66 per cent YoY to ₹4,047 crore, and HCL Software revenue climbed by 4.7 per cent YoY.
EBIT margin of IT and business services stood at 16.1 per cent, and that of engineering and R&D services came in at 16.8 per cent in Q1FY24 versus 17.1 per cent and 18.8 per cent respectively in the previous quarter.
‘’We experienced double-digit YoY growth, in our largest verticals - Financial Services, Manufacturing, and Life Sciences and Healthcare fueled by large deals,'' said C Vijayakumar, CEO at HCL Tech.
‘’These large deals helped offset cuts in client discretionary spend in these verticals. We are expecting other verticals to pick up as well shortly. This combined with the strength of our record-high pipeline enables us to maintain our guidance for the year." added C Vijayakumar.
Dividend
In a board meeting held on Wednesday, the company's board of directors declared an interim dividend of ₹10 per share having a face value of ₹2 each for the financial year FY24. The record date to determine eligible shareholders for the dividend benefits is fixed on July 20, 2023. While the payment date for the said interim dividend is scheduled on August 1, 2023.
The company paid first interim dividend of ₹18 per share in April month for the fiscal FY24. In the financial year FY23, the company paid a total dividend of 2,400 per cent aggregating to ₹48 per share to its shareholders.
FY24 guidance
The company retained its guidance of 6-8 per cent constant currency revenue growth for FY24, and operating margin or EBIT margin at 18-19 per cent. According to the FY24 guidance, the constant currency services revenue growth is expected to be between 6.5-8.5 per cent.
Attrition
HCL Tech reported a further decline in its attrition rate to 16.3 per cent in Q1FY24 from 19.5 per cent in the preceding March quarter of fiscal 2022-23. The company's total headcount as of June 2023 was 2,23,438, down by 2,506 sequentially. The company's total headcount as of June 2023 was 2,23,438, down by 2,506 sequentially.
During Q1FY24, HCL Tech hired 1,597 freshers which was a significant drop from 4,480 it hired in the March quarter. The number of additions of freshers in the company has been inconsistent as it dropped from a high of 10,339 in September 2022 to 5,892 in December 2022.
On July 12, shares of HCL Tech settled 0.42 per cent lower at ₹1,110.05 apiece on the BSE.
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Updated: 12 Jul 2023, 08:25 PM IST
HCL Tech Q1 Results: 5 key highlights from the IT major's June quarter scorecard | Mint - Mint
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