HCL Tech is weak today. The stock which has closed yesterday at Rs.1586.90, opened low at Rs.1574.10, going down to Rs.1552.70 and it continues to hover around Rs.1556 levels.

Like TCS and Mindtree, HCL Tech too revised its outlook downwards. The company, in its pre-earnings brief stated that the US dollar continued to strengthen against almost all global currencies like British Pound, Euro, AUD and so on. Since the company’s revenues are derived in multiple currencies, the revenues for the quarter to be reported in USDollar would have adverse impact of around 210 bps on account of strengthening of US$ against various global currencies.

At the beginning of the quarter, the company had estimated foreign exchange loss of US$ 2.5 million on account of cash flow hedges based on exchange rates prevailing as on September 2014 end. However taking into account the exchange rate as on December 18, 2014, the company now expects to post foreign exchange gain of US$ 2million covering the impact of both cash flow hedges and mark-to-market of the foreign currency assets and liabilities. This forex gain/loss would continue to be reported after EBIT.

For the first quarter ended 30th Sept 2014, the company had reported treasury income of $33.4 million. The treasury income is likely to be lower by about 5% in Q2 December 2014, HCL Technologies said. In Q1 September 2014, HCL Technologies had also recorded capital gains of $25.2 million on property sale. That being one off event would not be there in this quarter. The company said that it expects effective tax rate to be in the guided range of 21% to 22%.