Thread - HCL Technologies Ltd. concall Update (Not a buying recommendation)
Revenue expected to grow in double digits in constant currency for FY’22. EBIT margin expected to be between 19.0% and 21.0% for FY’22. Management has indicated that around 100 bps of margin impact in FY22 will be on account of investment in new geography.
The consensus EBIT margin expectation in FY22 21.2% as such will see some downgrade in earning or around 3-5%
• TCV is Strong -New Deal TCV hit an all-time high this quarter at US $ 3.1 B, increasing 49% YoY. For FY’21, New Deal TCV are US $ 7.3 B, which is 18% increase over FY’20. • CC QoQ came at 2.5% Dollar revenue came at $ 2695.9 Mn, (3% QoQ, 6% YoY)
• EBITDA Margin dipped by 224 bps QoQ and came at 25.9% which was impacted by Wage hike by (60) bps, Seasonal decline in revenue in BMp by (73 bps) Large no of fresher hiring by (61) bps and Forex by (21) bps. • Plans to hire 15000 entry level over the year in FY22
On segmental front: • IT and business Services – Grew by 5.2% QoQ. Going ahead this segment is Expected to have Strong growth with good demand from digital transformation deals.
• Engineering and R&D Services – Grew by 0.4% QoQ. The growth impacted by covid in auto and aerospace. Going ahead, this segment is expected to Low single digit
• Products and platform -75% of this segment is expected to have got strong double-digit growth in medium term. Remaining 25% is expected to have more of a sustain growth. • Adj. PAT came at Rs. 2962 Cr excluding bonus to employees of Rs.575cr.
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