Why HCL Technologies Shares Are Up Despite Broader IT Sector Challenges

HCL Technologies, in its Q2 results for fiscal 2023-24, revealed a 9.8% jump in consolidated net profit, reaching ₹3,832 crore from last year’s ₹3,489 crore. This profit boost comes despite the broader IT sector’s economic challenges, thanks to strong deal momentum.

HCL Technologies Q2 Performance: For this quarter, the company’s operational revenue hit ₹26,672 crore, marking an 8.04% growth from the previous year’s ₹24,686 crore. HCL Tech’s CEO, C Vijaykumar, highlighted a revenue growth of 1% QoQ and 3.4% YoY, emphasizing the company’s adaptability and dedication to operational efficiency.

Breaking down the numbers, the IT and business services segment earned ₹19,898 crore, showing a 4.6% YoY increase. Engineering and R&D services grew by 2% YoY, reaching ₹4,271 crore, while HCL Software revenue rose by 3.6% YoY.

See also: Why Infosys Shares Are Slumping Even As Q2 Results Beat Estimates

HCL Tech announced an interim dividend of ₹12 per equity share for fiscal 2023-24, with a record date set for October 31, 2023.

However, the firm adjusted its FY24 revenue guidance, cutting it to 4-5% from the previous 6-7%. The EBIT margin projection stands between 18-19%.

In terms of deals, HCL Tech secured 16 major contracts, with a standout deal involving Siemens AG choosing HCL Tech for its global IT overhaul and cloud-driven digital transformation.

Price Action: HCL Technologies Ltd. shares were up 2.47% at ₹1,254.00 on Friday shortly after markets opened for trading.

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