HCL Tech reports strong Q2 numbers, surpasses expectations
Chandrakant / 17 Jan 2012
HCL Technologies, a leading global IT service provider, announced its Q2 FY12 results on Tuesday, Jan 17, 2012. The company's financial year ending is in June. Its consolidated revenues during the quarter have grown by 35% on a YoY basis and by 12.8% QoQ to Rs 5245 cr. The net profits have grown by 43% YoY to Rs 573 cr, with the margins improving by 60 bps to 10.9% YoY.
Further, the EBITDA margins of the company improved by 140 bps on a YoY basis to 18.5% during the quarter, aided by a near 11% average fall in the value of the Indian rupee against the US dollar. All the new contracts were signed at better rates, and a jump of 5.7% in the volumes has helped the company to report better margins than the expected Q2 FY12 numbers. The overall EPS has improved by 45.8% on a YoY basis to Rs 31.60. Moreover, beating the uncertainty, the company added 57 new clients and signed 18 contracts with a total value of more than US$ 1 billion during the quarter.
HCL's results have remained marginally better in spite of problems from the major economies like the US and Europe, which together constitute 83% of the overall revenue contribution. On a QoQ basis, the revenues from the US and European markets grew by 7.3% and 6.3% respectively. The Financial Services and Manufacturing sectors continued to remain the top 2 major contributors, bringing in almost 50% of the total revenues. The segments themselves grew by 6.1% and 4.6% respectively.
The company has announced an interim dividend of Rs 2 per share in its 36th consecutive quarter of dividend payout. The gross and net employee addition has been at 7,804 and 2,556 respectively, taking the total headcount to 83,076.
With regard to the results, HCL's CFO, Anil Chanana, stated that the sequential margins in this quarter is a result of the continued investment in the business that has resulted in higher returns for the shareholders.
On the rupee depreciation, the company said that the volatility will continue going forward. However, it will remain watchful and will hedge its position. Moreover, HCL expects the second half of the fiscal to remain much better than the first half on the back of an improving market share and its various expansion strategies.
The markets cheered HCL Tech's Q2 performance. The stock was up 5.28% at Rs 427.50 in today’s trade on the BSE.
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