Visit http://indiaer.blogspot.com/ for complete details HCL Technologies – 1QFY2011
HCL Technologies reported its 1QFY2011 results. At the revenue front, in dollar terms,
numbers were ahead of the street as well as our expectations. The company’s revenue
came in at US $803.8mn, with growth of 9% qoq (v/s our expectation of US $792.5mn) on
the back of 7.87% volume growth in core software as well as 7.6% qoq constant currency
growth in infrastructure services. Cross-currency movement further aided growth by 1.6%
qoq. EBIT margins at 12.9% were in line with our expectation. PAT came in at `300.5cr v/s
our expectation of `269cr on the back of stronger growth, lower forex loss (`63.8cr v/s
expectation of `74cr) and lower effective tax rate.
The company is expected to be the outperformer in Tier-I IT pack in terms of volume
growth because of strong deal pipeline spanning across higher value-chain services. The
company is one of our preferred picks in the IT sector. At the CMP of `426, the stock is at
attractive valuations of 13.6x FY2012 EPS. We remain positive on the stock. The stock is
currently under review.
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