HCL Tech Q1 Review - Absence Of Growth, Cheap Valuations: Prabhudas Lilladher
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Prabhudas Lilladher Report
HCL Technologies Ltd. reported big miss on revenue with growth of 0.9% QoQ U.S. dollar (our estimate: 1.5%, 2%) led by decline in products business (down 1% QoQ constant currency) and flattish growth in IT services (0.3% QoQ CC) which was impacted by pandemic related absenteeism, slippage of project milestones and closure of one professional services contract.
Engineering research and development vertical showed recovery (up 4.3% QoQ CC) after weak performance in past few quarters.
Unlike peers who raised growth guidance, HCL Technologies management maintained double digit growth guidance not giving specific growth number despite healthy new deal total contract value ($ 1.66 billion, up 37% YoY in Q1 FY22 and $3.1 billion in Q4 FY21) and strong pipeline.
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