HCL Technologies revealed its financial performance for the July-September quarter of fiscal year 2023-24 (Q2FY24) on October 12. The company reported a consolidated net profit of ₹3,832 crore, marking a 9.8% increase from ₹3,489 crore in the same period the previous year. This profit growth was bolstered by strong deal closures, despite ongoing macroeconomic challenges in the IT sector.
In the second quarter of the current fiscal year, the IT services company generated revenue from operations totalling ₹26,672 crore, marking an 8.04% increase from ₹24,686 crore recorded in the same period last year.
Ramachandran Sundararajan, the Chief People Officer at HCLTech, announced that the company plans to implement pay revisions starting from October. Senior management personnel will not receive pay hikes in FY24, but 90% of the workforce will be eligible for pay hike revisions. Additionally, HCLTech aims to hire 10,000 freshers in the fiscal year 2024 and will continue with campus placements, as per Sundararajan’s statement.
“Our revenue growth of 1 per cent QoQ and 3.4 per cent YoY on a constant currency basis, with a 154 bps QoQ improvement in operating margin and improving cashflows, reflect our ability to execute well in an evolving business environment and our commitment to operational efficiency,” said C Vijaykumar, CEO and Managing Director, HCL Tech.
HCL Technologies Segment Performance
In terms of segment performance, HCL Technologies experienced a notable increase in revenue for its IT and business services, reaching ₹19,898 crore in Q2FY24, marking a 4.6% growth compared to the previous year. Additionally, the revenue from engineering and R&D services displayed a modest growth of 2%, totaling ₹4,271 crore YoY, while HCL Software revenue saw a 3.6% YoY increase.
In terms of profitability, the EBIT margin for IT and business services reached 18.1%, showing significant improvement from the previous quarter’s 16.1%. Similarly, the EBIT margin for engineering and R&D services stood at 19.2%, indicating an enhancement from the previous quarter’s 16.8%. These positive trends underscore HCL Tech’s robust performance in its various segments during Q2FY24.
HCL Technologies’ Q2 results indicate a decrease in headcount by 2,299 during the September quarter, resulting in a total headcount of 221,139 employees. The company welcomed 3,630 new graduates while reporting a Last Twelve Months (LTM) attrition rate of 14.2%, a notable decline from the 23.8% recorded in the same quarter last year.
HCL Technologies, based in Noida, announced an interim dividend of ₹12 per equity share with a face value of ₹2 each for the fiscal year 2023-24. The Board of Directors confirmed the record date for this dividend as October 20, 2023. The payment of the interim dividend is scheduled for October 31, 2023, according to a regulatory filing made by HCL Tech to the stock exchanges.
Vijayakumar on Israel – Hamas War
Vijayakumar, the company’s CMD, stated that the ongoing Hamas strikes in Israel have not affected our business operations there. We currently employ around 100 staff members in the region.