This quarter we also made significant progress in the execution of our digital system integration services strategy by signing new engagements and establishing dedicated centres of excellence to further strengthen our thought leadership and thrust on Gen 2 outsourcing,” chief executive Anant Gupta said in a statement.
The company’s strong results was primarily led by its infrastructure management business, the revenues for which doubled in three months ended December over the last year.
On Friday, larger peer Infosys Ltd trumped market expectations with a strong performance in a seasonally soft quarter for software services exporters and raised its guidance, buoying investor hopes of similarly robust results from other larger peers such as TCS and Wipro Ltd. TCS will report its third-quarter results later on Thursday.
“The top line (revenue) for the company remains in line with our expectations, while margins are better than expected. Constant currency revenue growth of 3% is modestly higher than our estimate of 2.7% growth. However, the main concern, the broad basing of the growth on the infrastructure management services, remains the same,” said a Mumbai-based analyst, declining to be named. “December is a seasonally week quarter. While infrastructure services grew healthily, software services remained muted.”
“The quarter also marked the fifth consecutive quarter of deal wins in excess of $1 billion. Headcount additions continued to remain muted with technical headcount up by just 1,035 employees, which comes as another area of concern,” he said. “In essence, the story broadly remains the same for HCL Tech. Infra is still the key bulwark for growth. Productivity is pulling margins up, consequently keeping the headcount growth muted. Deal wins and cash conversion continued to remain robust supporting revenue visibility and the multiples, respectively.”
The company’s total headcount stood at 88,332, having added 1,136 employees over the same period last year.
On Wednesday, HCL Tech inked a strategic partnership with US-based rival Computer Sciences Corp. to help clients upgrade their IT systems and transition to cloud computing as part of a broader attempt from the Noida-based firm to gain more market share in the US public sector and keep pace with other fast-growing top-tier Indian rivals.