HCL TECHONOLOGIES

The company did much better than expectations. Post its performance in Q1, it was as such widely expected that Q2 ended 31st Dec 2012 would be much better and it did not disappoint. It posted a consolidated net profit at Rs.965 crore, up 68% on YoY.  Revenues also jumped 20% at Rs.6,274 crore. Over the past five consecutive quarters, the company’s net margin has been on the improvement and even in current Q2, it grew to 15.4%, up 400 bps from 19.8% on YoY. Earnings before interest and taxes (EBIT) was at Rs.1,244 crore, up 50%.

The company’s revenues from the European rose 4.2% and that from American markets rose 3.4%. Among the verticals, financial services grew at 10.1%, followed by energy, utilities and public services at  4.7% and media publishing and entertainment at 4.2%. The total headcount as of December 31 stood at 85,194 people against 83,076 employees in the corresponding month previous year – there were gross additions to the tune of 5136 employees but on the net front, lost 395 employees. The company announced a dividend of Rs 2 per share, the fortieth consecutive quarter of dividends. Its utilisation is at 81.9% and attrition is stable at 13.6%. It has notched up a good performance for the first half, though there are apprehensions about the company being able to sustain this momentum. With infra and BFSI being its main growth drivers, it looks like this year for HCL could be much better.