HCL Tech Q4 Results
HCL Technologies Ltd announced a 226 percent increase in its consolidated PAT to Rs 3,593 crore on April 21, compared to Rs 1,102 crore in the previous quarter. The adjusted net profit for the same period last year was Rs 2,962 crore due to the effect of deferred tax credit and the one-time milestone bonus given during Q4FY21.
The Noida-based IT firm’s consolidated sales increased by 15% to Rs 22,597 crore from Rs 19,642 crore the previous year. Revenues climbed 1.2 percent year over year, to Rs 22,331 crore, from Rs 22,331 crore the prior quarter. The IT services and ERD businesses contributed to the quarter’s revenue increase, but HCL’s P&P segment declined to owe to seasonality.
PAT climbed by 21.1 percent to Rs 13,499 crore for the entire year from April to March, compared to a profit of Rs 11,145 crore in the previous financial year. Consolidated sales increased by 13.6 percent to Rs 85,651 crore in FY22, compared to Rs 75,379 crore in FY21. In financial terms, revenue for the quarter was $2,993 million, an increase of 11% year over year and 0.5 percent sequentially. Revenue increased 13.3% year over year and 1.1 percent quarter over quarter in CC. The company’s dollar sales climbed 12.8 percent year over year, while CC revenues increased 12.7 percent.
Verticals and regions that generate revenue
Services revenue for the whole year surpassed $10 billion, representing a 14.9 percent YoY increase in CC for FY’22. HCL’s services business gained 5% QoQ in CC and 17.5 percent year over year during the quarter, with a CQGR of 5.2 percent for the third quarter in a row.
Engineering and R&D Services climbed 23.7 percent year over year and 3.9 percent quarter over quarter, with momentum in digital engineering and IoT Works driving the growth. During the quarter, IT and Business Services expanded at a strong 16.2 percent year over year and 5.2 percent quarter over quarter, owing to increased cloud transition and application and data modernization. In terms of geography, Europe increased by 13.6 percent, the Americas expanded by 13%, and the rest of the world grew by 15%.
On a year-over-year basis, the firm was able to enhance its adjusted EBIT margins for both the quarter and the entire year. EBIT margins for the quarter were 18 percent, up 1.5 percent year over year but down 4.4 percent quarter over quarter.
The firm had an EBIT margin of 18.9% for the whole year, up 0.2 percent from the previous year. The quarter’s net margin was 15.9%, up 24 percent year over year and 4.4 percent quarter over quarter. In comparison to the previous year, full-year net margins increased by 4.3 percent to 15.8 percent.
Dealing with TCV
The total contract value of new deal wins in FY22 was $8,308 million, up 14% year over year. The new transaction TCVs for the quarter was $2,260 million, up 6% from the previous quarter. During the quarter, there were ten net new contract wins, with six of them being new big services transactions with a total value of $2,216 million. Apart from a considerable number of lesser sales, there were four big product contract wins totaling $54 million in TCV.
Human Resource Management
The company’s overall personnel count was 208,877, with net hiring of 11,000 individuals internationally in the third quarter and 39,900 for the whole year. During the year, the firm employed 23,000 entry-level freshers, with women accounting for 28 percent of the company’s worldwide workforce.
Localization was 70.9 percent in the United States, 80.5 percent in Europe, and 88.9 percent in APAC and the rest of the globe. On an LTM basis, attrition increased to 21.9 percent, up from 19.8 percent in the December quarter and 9.9 percent in the same quarter the previous year.
With a record date of April 29, 2022, HCL Technologies announced an interim dividend of Rs 18 per equity share of Rs 2 apiece. On May 11, 2022, the dividend will be paid.
Guidance for Fiscal Year 23
For FY23, the business predicts sales growth of 12 to 14 percent and EBIT margins of 18 to 20 percent. On April 21, the HCL technologies share price finished at Rs 1,099.20, up Rs 9.8 or 0.9 percent, on the National Stock Exchange. It has returned 14.35 percent over the last year, but the stock has been down 5.9 percent in the last month.
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