HCL Tech Q1 results: Net profit rises 2.4% to Rs 3,283 cr, revenue up 16.9%

HCL Technologies reported a net profit of Rs 3,283 crore, up 2.4 per cent year-on-year (YoY), but was down 8.6 per cent sequentially.

Revenue for the quarter stood at Rs 23,646 crore, up 16.9 per cent YoY. The growth was 3.8 per cent sequentially.

The revenue met Bloomberg estimates but missed the net income target. Bloomberg had estimated the net income to be Rs 3,320 crore.

In dollar terms, revenue grew 11.2 per cent YoY and 1.1 per cent sequentially. The company also maintained its FY23 revenue guidance at 12-14 per cent growth.

HCL Tech had a total contract value (TCV) of new deals worth $2 billion, a growth of 23.4 per cent YoY.

Of this, the services business had a TCV of $1.95 billion and product TCV was at $104 million.

Growth driver for the company was its engineering and R&D segment, which grew 23 per cent YoY and 3.7 per cent sequentially. The IT and services business grew by 18.1 per cent YoY.

“The TCV that we have signed is the highest ever and this also gives confidence for a strong note to start FY23 on. Our services business continues to have robust growth momentum, growing at 2.3 per cent quarter-on-quarter and 19 per cent YoY in constant currency. It was driven by our digital engineering and digital application services with Cloud adoption being a horizontal theme across all services and verticals,” said C Vijayakumar, chief executive officer (CEO) & managing director (MD), HCL Technologies.

Margins of the company were impacted due to salary increases. Earnings before interest, taxes, depreciation, and amortisation (EBITDA) came in at 21.2 per cent, down 1.7 per cent YoY and down 1.5 per cent sequentially.

Attrition for the quarter was up at 23.8 per cent. Attrition was at 21.9 per cent in Q4 of FY22 and 11.8 per cent in Q1 of FY22. The company plans to add 30,000-35,000 freshers for FY23.