After TCS, Wipro, Infosys and Mindtree, one of the other top Indian tech majors HCL Tech has announced its Q2 FY21 Results. HCL Tech’s Q2FY21 performance was marginally better than analysts estimates

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Revenue stood at US$ 2,507 mn; up 6.4% QoQ & 0.8% YoY while Revenue in Constant Currency; up 4.5% QoQ & down 0.4% YoY. EBITDA margin came at 26.6% while EBIT margin at 21.6%, Net Income at US$ 424 mn; up 9.7% QoQ & 12.7% YoY.

Revenue came at Rs 18,594 cr; up 4.2% QoQ & 6.1% YoY, Net Income stood at Rs 3,142 crores; up 7.4% QoQ & 18.5% YoY.

FY 2021 Guidance:
Revenue to grow QoQ by an average of 1.5% to 2.5% in constant currency for Q3 and Q4, FY 21 EBIT to be between 20.0% and 21.0% for FY 21.

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Key Highlights (for the quarter ending September 2020)

1. HCL signed 15 transformational deals, led by key industry verticals including life sciences and healthcare, public services (energy & utilities) and manufacturing.
2. Broad based performance in Q2 with all growth engines firing. All the Geographies / Segments / Verticals return to smart positive sequential growth.
3. Strong revenue growth at 4.5% QoQ in constant currency accompanied with expansion in margins on both YoY and QoQ basis. – EBITDA at 26.6% and EBIT at 21.6% expanded by 320 bps and 160 bps        respectively (on YoY basis).
4. Mode 2 revenue exceeds US$ 500 mn milestone; EBIT Margin at 18.5% expanding 450 bps (on YoY basis).
5. Declared Dividend of Rs 4 /- per share, being 71st consecutive quarter of dividend pay-out.
6. IT Services attrition (LTM basis) at 12.2%, down 470 bps YoY. 7. Cash Generation and conversion continues to be very robust:
7. Cash Generation and conversion continues to be very robust
8. Gross Cash stands at US $ 2,246 mn and Net Cash at US $ 1,826 mn at the end of September 30th, 2020.
9. EPS at Rs 45.2 registered healthy growth at 22.0% on LTM basis. Cash EPS Rs 60.3 also grew healthy at 36.3% on LTM (Last Twelve months) basis.

(Authored by Rahul Kamdar)