HCL Tech Q3 Results: Profit Beats Estimates, Lower End Of Revenue Guidance Raised
Net profit rose 14.6 percent sequentially to Rs 3,037 crore in the quarter ended December.
HCL Technologies Ltd. raised revenue guidance for the ongoing financial year as its net profit beat estimates.
Net profit rose 14.6 percent sequentially to Rs 3,037 crore in the quarter ended December, the software services provider said in its exchange filing. That compares with the Rs 2,758-crore consensus estimate of analysts tracked by Bloomberg.
Revenue in rupee terms rose 3.5 percent sequentially to Rs 18,135 crore, against the Rs 18,155-crore estimate. The company’s top line was aided by the acquisition of security and digital solution providers AppScan and BigFix from IBM in July. HCL Technologies has fully recognised the revenue from the deal in the reported quarter. Revenue in terms of dollar rose 2.3 percent to $2,543 million in the quarter.
WATCH | 5 key takeaways from HCL Tech’s Q3 earnings
The company also raised its revenue growth guidance to 16.5-17 percent in constant-currency terms for the financial year ending 2020 from 15-17 percent. In the last quarter, it had hiked the revenue growth guidance for FY20 to 15-17 percent from 14-16 percent.
Earnings before interest and tax rose 5 percent sequentially to Rs 3,670 crore, the filing said. Operating margin expanded at least for the second straight quarter to 20.2 percent from 20 percent. That was aided by a weaker rupee as software exporters bill most of their global clients in U.S. dollars. The Indian currency depreciated 0.42 percent against the greenback during the quarter.
In comparison, peer Infosys Ltd.’s quarterly net income beat the highest analyst estimates as Asia’s second-most valuable software services exporter also raised its sales-growth outlook for the financial year ending March 2020 to 10-10.5 percent. Wipro Ltd., too, reported a rebound in its margin during the third quarter.
Shares of HCL Technologies gained 0.91 percent before the results announcement. The stock has gained more than 24 percent in the last 12 months, outperforming the Nifty IT Index.
WATCH | HCL Tech management speak to BloombergQuint on Q3 earnings.