HCL Technologies fell 2.19% to Rs 907.70 after the company reported 8.6% fall in consolidated net profit to Rs 3,283 crore despite a 3.8% rise in revenue to Rs 23,464 crore in Q1 FY23 over Q4 FY22.
Compared with Q1 last year, net income rose 2.4% while topline jumped 16.9% in the first quarter.
HCL expects revenue to grow between 12% to 14% in constant currency terms and the EBIT margin to be between 18% to 20% in FY2023.
EBITDA fell by 1.5% to Rs 4,975 crore in Q1 FY23 from Rs 5,053 crore in Q4 FY22. EBITDA Margin in Q1 FY23 was 21.2% as against 22.4% in Q4 FY22.
In dollar terms, the company's revenue stood at $3,025 million, up 1.1% QoQ and up 11.2% YoY. In constant currency terms, revenue growth in Q1 FY23 was 2.7% QoQ and 15.6% YoY.
For Q1 FY23, total contract value (TCV) of new deal wins was at $2,054 million, registering 23.4% YoY.
During Q1, Services business has grown at 2.3% QoQ cc and 19.0% YoY cc. Engineering and R&D Services grew at robust 3.7% QoQ cc (23.0% YoY cc) driven by traction in digital engineering and IoT Works. IT and Business Services grew at healthy 2.0% QoQ cc (18.1% YoY cc), driven by acceleration in cloud transformation and application and data modernization.
All round growth in Services (ITBS and ERS) across verticals and geographies YoY in constant currency for the quarter. Growth momentum led by Technology & Services (34.2%), Telecom, Media, Publishing & Entertainment (29.2%), Manufacturing (19.1%), Financial Services (16.4%), Lifesciences & Healthcare (15.7%) and Public Services (15.2%).
Geography growth powered by Europe (22.5%), Americas (17.5%) and ROW (18.2%).
Employee benefits expense in Q1 FY23 stood at Rs 12,978 crore, up 3% QoQ and up 21.2% YoY.
Total headcount at 210,966, up 1% QoQ and up 19.5% YoY. Attrition (on the last 12-month basis) was at 23.8% in Q1 FY23 as against 21.9% in Q4 FY22 and 11.8% in Q1 FY22.
C Vijayakumar, CEO & Managing Director, HCL Technologies, said: We have started FY'23 on a strong note with an overall growth of 2.7% QoQ and 15.6% YoY in Constant Currency. Our services business continues to have robust growth momentum, growing at 2.3% QoQ and 19.0% YoY in constant currency, driven by our digital engineering and digital application services with cloud adoption being a horizontal theme across all services and verticals.
Our new bookings grew 23.4% YoY supported by a good mix of large and mid-sized deals and our pipeline remains near record high. Our operating margin came in at 17%. We have put in place the right measures that will improve our profitability going forward.
Prateek Aggarwal, Chief Financial Officer, HCL Technologies, said: The key highlight of the quarter is the stellar growth in Services at 19% YoY in CC. Products & Platforms was 1.4% up YoY in CC, excluding the divested/discontinued business. Our cash generation continues to be robust at operating cash flow (OCF) of US$ 2,013 million and free cash flow (FCF) of US$ 1,762 million, on LTM basis, with OCF /NI at 112%. The board has approved a dividend on INR 10 per share in accordance with our Capital Allocation Policy.
The record date of 20 July 2022, fixed for the payment of the aforesaid interim dividend has been confirmed by the board of directors. The payment date of the said interim dividend shall be 2 August 2022.
HCL Technologies (HCL) empowers global enterprises with technology for the next decade, today. HCL offers its services and products through three business units: IT and Business Services (ITBS), Engineering and R&D Services (ERS) and Products & Platforms (P&P).
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