HCL Tech expects Q2 revenue to be meaningfully better

IT services major HCL Technologies on Monday said its revenue and operating margin for the September 2020 quarter is expected to be “meaningfully better” than the top end of its previous forecast.

The Noida-based company expects its revenue growth in constant currency terms to exceed 3.5 per cent quarter-on-quarter (q-o-q) for the July-September 2020 period, according to a regulatory filing.

Providing a mid-quarter update, HCL Technologies said it expects its revenue and operating margin for the current quarter to be meaningfully better than the top end of its guidance given in July.

“We have seen strong execution during the quarter to date, and continue to execute to the plan this month,” it said.

HCL Technologies said its sequential revenue growth for the current quarter in constant currency terms is expected to exceed 3.5 per cent, enabled by broad-based momentum across all service lines, verticals and geographies.

In July, while reporting its financial performance for the June 2020 quarter, HCL Technologies had said it expects its revenue to increase q-o-q by an average of 1.5 per cent to 2.5 per cent in constant currency for the next three quarters.

Also, it had guided for its operating margin to be between 19.5 per cent and 20.5 per cent for FY”21.

The EBIT (earnings before interest and taxes) percentage for the current quarter is expected to be between 20.5 per cent and 21 per cent, the filing said.

“Good booking momentum continues this quarter, led by life sciences and healthcare, telecom and media and financial services verticals,” it added.

The pipeline continues to look healthy across service lines, verticals and geographies, HCL Technologies noted.

HCL Technologies” revenue in the June quarter was up 8.6 per cent year-on-year (y-o-y) and down 4 per cent q-o-q to Rs 17,841 crore.

In constant currency terms, revenue was up 1 per cent y-o-y and down 7.2 per cent q-o-q in the June quarter. PTI