The shares of HCL Technologies declined by over 3 per cent to Rs 969 per share on the BSE intraday trade today, as the company reported lower-than-expected Q1 results of FY22 on Monday.

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HCL Tech became the fourth IT heavyweight to report its June-ended quarter results yesterday, after TCS, Infosys and Wipro earlier this month. The IT major’s consolidated net profit marginally grew by 9.4 per cent to Rs 3,213 crore as against Rs 2,935 crore in the same period a year ago.

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Meanwhile, the information and technology company's consolidated revenue from operations stood at Rs 20,068 crore as against Rs 17,842 crore in the corresponding quarter last year. The company in a filing said that its revenue in constant currency is expected to grow in double digits in fiscal 2022.

The IT heavyweight also stated in its exchange filing that the company maintains FY22 EBIT margin guidance of 19-21 per cent.

At around 12:26 pm, the stock was trading at 2.37 per cent lower to Rs 977 per share, which is near the day’s low level, on the BSE as compared to a 0.86 per cent decline in the S&P BSE Sensex.

Despite missing estimates, the brokerages are bullish on the HCL Tech shares, as CLSA maintains a Buy rating, while Macquarie has an Outperform stance on the stock. 

CLSA says the second wave affects Q1 FY22 of the company and healthy deal wins and pipeline keeps hopes alive for the scrip. It mentions, HCL Tech’s problems appear transient not structural and has reduced their FY22/23EPS forecasts to 2/1 per cent. It sets a price target of Rs 1180 apiece.

While Macquarie expects the growth to pick up in coming quarters of HCL Tech and the IT major’s products and platforms hit by seasonal weakness. It sets a target price of Rs 1220 per share.

HCL Tech dragged both Nifty50 and Nifty IT Indices by being the top laggards today. The IT Index is overall weak except Infosys in heavyweights.