HCL Tech Reported Muted Q1FY16 Quarter Numbers

HCL Technologies is India’s fourth-largest software services Provider Company has posted lower-than-expected quarter results for the quarter ending September 2015. The Company took a hit on its bottom-line due to a provision.

The company reported 3.2 per cent quarter-on-quarter (Q-o-Q) decline in consolidated net profit to Rs 1,726 crore for the quarter ended September 2015. Consolidated revenues grew by 3.3 per cent on sequential basis and recorded at Rs 10,097 crore.

In terms of USD, the revenue was up 0.50 per cent Q-o-Q at USD 1,545 million, while net income declined 5.4 per cent Q-o-Q at USD 264 million in July-September quarter, HCL Technologies said in a press release. HCL's profit fell as the company took an adjustment - related to a one time provision - on a project.

As per geographic segregation, revenues from Europe grew 18.2 per cent Y-o-Y (0.7 per cent Q-o-Q) while those from the Americas jumped 12.3 per cent Y-o-Y (5.6 per cent Q-o-Q) during the quarter. The rest of the world fell 8.4 per cent Q-o-Q.

Engineering services was the fastest growing line of business for the company, reporting a revenue increase of 3.6% sequentially. Application services barely grew, rising 0.1%.

It signed 10 transformational engagements with more than USD one billion of Total Contract Value this quarter.

The company has declared an interim dividend of Rs 5 per share on FV of Rs 2.

The company had said it expects revenues to get impacted by adverse currency movement and issues with a client in the public services vertical. Other large IT companies have also struggled in meeting growth expectations and forecast lower than expected full year growth on the back of increasing macro-economic uncertainty.

Currently, the stock was marginally up 0.21% to Rs 843.15 on the BSE. The stock hit a high of Rs 851 and a low of Rs 818.40 so far during the day. The stock hit a record high of Rs 1058.20 on 11 March 2015. The stock hit a 52-week low of Rs 725.18 on 15 December 2014.