HCL Tech Q2 Review - Total Contract Value, Headcount Suggest Acceleration: Dolat Capital
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Dolat Capital Report
HCL Technologies Ltd. reported revenue growth of 3.5% in constant currency terms (our estimate: 4%) as revenues got impacted in the products and platform segment due to poor closures (down 8% QoQ), while IT services business grew by 5.2% QoQ.
Operating profit margin at 19.0% were below our estimate (our estimate: 19.2%) largely on account of weak P&P revenues that led to its segment margins to decline from 23.7% to 19.4% while segment margins for IT services remained largely flat at 18.9%.
HCL Tech has retained operating profit margin guidance at 19%-21%.
Guided double-digit growth, which along with strong net new total contract value wins implies potential for improved growth performance hereon and potential acceleration in FY23 as well.
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