HCL Technology Reports better Q3FY12 numbers

HCL Technology, a leading global IT service provider, announced its result for the March quarter 2012. In spite of the various problems emanating from Europe and the US region the company has reported better than expected result. Also, after looking at the Infosys’ muted result and subdued guidance, one was not expecting much from the IT sector in the March quarter 2012. However, HCL seems to have done well during the quarter. Company reports its financials for the period July to June.

In dollar terms the company has done well and the consolidated revenue has grown by 2.5 per cent on a QoQ basis to USD 1,047.9 million while net profit has shown strong growth of 8.6 per cent to USD 121.1 million. This was mainly on account higher growth from Infrastructure and Enterprise application services which grew by 5.2% and 4.3% respectively.

In the previous quarter the company had said that rupee depreciation would lead to volatility in the coming quarter, further adding that the second half of the fiscal would be much better than the first half due to an improvement in its market share and effective expansion strategies. This is contrary to the guidance of Infosys that has painted a grim outlook for the coming quarter.

The company reported decent quarter numbers despite the pressure coming from its major business verticals such as financial services and the manufacturing industry which grew by -2.9 per cent and 0.7 per cent respectively. The other business verticals have reported decent growth on the revenue front. Energy & Healthcare verticals grew by 8.3% each while Media vertical grew by 6.5%. Also robust demand has helped the company maintain momentum in its topline over the last few quarters.

The revenue from the US and Europe market grew by -1.0 per cent and 5.5 per cent respectively. Financial services and the manufacturing sector continue to remain its top two major contributors, making up for almost 50 per cent of the total revenue

The volumes have helped the company to report marginally better-than-expected Q3FY12 numbers. The overall EPS of the company has improved by 5 per cent on a QoQ basis at Rs 34.9.  Moreover, in spite of the prevailing uncertainty the company added 32 new contracts in last six months and signed deals with a total value of more than USD 1.5 billion during the quarter.

The company has announced an interim dividend of Rs 2 per share for the 37th consecutive quarter of dividend payout. The total number of employees during the quarter has reduced from 83,076 to 82,464. 

The markets cheered HCL Technology’s second quarter performance and the stock was up by 3.06 per cent at Rs 495.50 on the BSE in today’s trade.