HCL Technologies for the quarter ended Dec 2020 reported a revenue (in US dollar terms) of USD 2616.6 million, a growth of 4%QoQ and 3%YoY. But on constant currency terms the revenue growth was up 3.5%QoQ and 1.1%YoY. The growth in USD (on reported basis), Mode 1 services [(services aimed to offer leadership position or business competencies for its clients core business process products/services) (accounts for 61% of its HCLT's revenue)] registered a growth of 1%QoQ and -5%YoY. However, the Mode 2 services [(services that helps enterprise take the next digital leap) (accounts for 22.7% of HCL's revenue)] registered strong growth of 13%QoQ and 28%YoY. Similarly the Mode 3 services [Innovative IP's to help enterprises to be future ready) (or 16.3% of revenue)] registered a growth of 8%QoQ and 6%YoY.

Consolidated revenue for the quarter in rupee terms was up by 4%QoQ to Rs 19302 crore (from Rs 18594 crore in quarter ended Sep 2020) with USD revenue grew by 4% to Rs 2616.6 million. Higher revenue for the quarter was largely due growth by all business segment of the company in USD terms. The revenue of ITBS (IT & business services) was up by 4%QoQ. Similarly the revenue of P&P (Products & Platforms) as well as Engineering and R&D (ERD) was up by 3%QoQ and 9%QoQ respectively. While ITBS revenue stood at USD 1843 million, that of ERD and P&P stood at USD 405 million and USD 368 million.

As OPM expand by 160 bps to 29.1%, facilitated by higher revenue and higher OPM, the operating profit was up by 10% QoQ to Rs 5624 crore. The PBT was up by 8%QoQ to Rs 5666 crore after accounting for lower other income as well as higher interest and depreciation cost. With taxation stand lower by 50% QoQ to Rs 502 crore, the PAT was up by 26%QoQ to Rs 3977 crore. The MI was up by 167% QoQ to Rs 8 crore and thus the net profit was up by 26% QoQ to Rs 3969 crore.

Quarterly result YoY comparison

Revenue for the quarter ended Dec 2020 was up by 6% to Rs 19302 crore. Higher sales together with 360 bps expansion in OPM to 29.1%, the OP was up by 21% to Rs 5624 crore. The PBT was up by 22% to Rs 4479 crore gained further by higher OI and lower interest cost. After accounting for lower taxation (down 32% to Rs 502 crore), the PAT was up by 35% to Rs 3977 crore. Eventually the netprofit after MI was up by 35% to Rs 3969 crore.

Nine month performance

Revenue for the period was up by 7%YoY to Rs 55738 crore and with OPM expand by 390 bps to 27.8%, the operating profit was up by 24% YoY to Rs 15499 crore. After accounting for higher OI, lower interest and higher depreciation, the PBT was up by 24% YoY to Rs 12486 crore. With taxation stand higher by 10% to Rs 2428 crore, the PAT was up by 28% YoY to Rs 10058 crore. The net profit after MI was eventually up by 27% YoY to Rs 10043 crore.

Guidance for FY21

Expect revenue including DWS contribution, to register an average growth of 2-3%QoQ in CC for Q4FY21 and FY21. EBIT to be between 21-21.5% for FY21.

Other developments

HCL in Q3Fy21 won 13 transformational deals across industry verticals, including life sciences and healthcare, technology and financial services.

For FY20 HCL signed 53 transformative deals and USD100+ Mn clients increased by 5, from 10 to 15 (on YoY basis).

Management Comment

Shiv Nadar, Chief Strategy Officer said, The technology sector is in the midst of a massive digitization wave, with more global enterprises embracing digital transformation to address the disruption of these unprecedented times. Technology has been a key enabler during the pandemic, and as we stand at the cusp of the next phase of technological innovation, it is vital that we draw inspiration from each other's strengths and offer back our own to create a positive impact. From delivering cuttingedge, agile solutions to our partners, to creating people-first initiatives, to building a sustainable and resilient ecosystem, we at HCL are committed to become a catalyst of positive change and the creation of relationships beyond the contract.

C Vijayakumar, President & CEO, HCL Technologies said, We posted a strong financial performance in Q3 FY'21 with a constant currency revenue growth of 3.5% sequentially and 1.1% YoY and an EBIT of 22.9%. This solid performance was driven by a robust momentum in our Mode 2 and Mode 3 businesses led by Digital, Cloud and Products & Platform segments. Our results reflect the success of the strategic investments we have made over the years including unique ecosystem constructs with all Cloud Hyperscalers, organic and inorganic investments in a broad-based IP and Platforms portfolio and an enterprise digital transformation value proposition that is truly integrated and differentiated He further added, I am also delighted to share that we crossed $10 B in revenues in 2020. This is a pivotal milestone for us as a company and is a result of HCL's vision, our employees' passion and disciplined execution,

Prateek Aggarwal, CFO, HCL Technologies said, It feels good to have crossed the US$ 10 Billion Revenue milestone LTM. In CY20, we have delivered 3.6% growth YoY, both in US$ terms and in constant currency. For CY 20, we delivered EBITDA (as per Ind AS) at 27.4% and Net Income Margin at 17.8% ( ` 13 202 Cr) ; For the quarter Q3'FY21, it is noteworthy that our EBITDA (on Ind AS basis) stood at 29.1% and Net Income Margin at 20.6% ( ` ~3982 Cr) . Cash generation continues to be very robust. During CY 20, our Operating Cash generation was US$ 2,667 mn and Free Cash Flow was US$ 2407 mn, having increased 63.5% and 82.8% respectively on YoY basis. LTM EPS now stands at ` 48.7 and Cash EPS at Rs 62.2.

 HCL Technologies: Consolidated Financial Results

 

	2012 (3)	2009 (3)	Var. (%)	1912 (3)	Var. (%)	2012 (9)	1912 (9)	Var. (%)	2003 (12)	1903 (12)	Var. (%)
Sales	19302	18594	4	18135	6	55738	52089	7	70676	60427	17
OPM (%)	29.1	27.5		25.5		27.8	23.9		24.5	23.0
OP	5624	5118	10	4629	21	15499	12458	24	17316	13926	24
Other inc.	189	199	-5	157	20	683	442	55	589	943	-38
PBIDT	5813	5317	9	4786	21	16182	12900	25	17905	14869	20
Interest	147	80	84	158	-7	352	381	-8	505	174	190
PBDT	5666	5237	8	4628	22	15830	12519	26	17400	14695	18
Dep.	1187	1092	9	942	26	3344	2424	38	3420	2073	65
PBT	4479	4145	8	3686	22	12486	10095	24	13980	12622	11
Tax	502	999	-50	742	-32	2428	2210	10	2923	2502	17
PAT	3977	3146	26	2944	35	10058	7885	28	11057	10120	9
MI	8	3	167	0		15	0		0	0
Net Profit	3969	3143	26	2944	35	10043	7885	27	11057	10120	9
EPS (Rs)*	58.5	46.3		43.4		49.3	38.7		40.7	37.3
* On current Paid up equity capital of Rs 542.734 crore, Face value Re 2 Figures in crore EO: Extraordinary items EPS is adjusted after EO and relevant tax Source: Capitaline Databases

Powered by Capital Market - Live News