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HCL pegs FY23 revenue growth at 12-14%

HCL Technologies Ltd said that revenue for this fiscal year would grow between 12-14% in constant currency, following a positive market environment and strong growth momentum in the last three quarters, particularly in the services business, after a year of only providing directional guidance. For FY23, the company expects an 18-20% Ebit margin. 

HCL Technologies, situated in Noida, reported a net profit of ₹3,593 crores for the March quarter, up 24% from the previous year, discounting the impact of a one-time incentive paid to staff and tax charges. 

Revenue for the March quarter increased 15% year over year to ₹22,597 crores. The services industry, which has grown at a compound quarterly growth rate (CQGR) of 5.2% for three quarters, drove revenue. 

The company’s full-year revenue increased 13.6% to ₹85,651 crores, owing to excellent performance across all business areas, headed by its digital business, or ‘Mode 2,’ which increased 31.8% in constant currency. 

In constant currency, HCL’s dollar sales increased 13.3% to $2.99 billion in the third quarter, boosted by new deal wins and clients’ digital agenda acceleration.

“Over the last three quarters, our services business has been consistently growing organically at 5% and higher, delivering one of the highest CQGR in the industry. Our overall growth on YoY basis stands at 12.7%, which is better than the guidance, led by strong momentum in digital, cloud and engineering services. We continue to invest proactively to create a larger talent pool to address the demand,” said C. Vijayakumar, HCL’s chief executive and managing director.

Meanwhile, the company’s attrition rate increased to 21.9% in the March quarter, up from 9.9% a year ago and 19.8% in the December quarter, indicating that demand for IT expertise outweighs supply. However, the high attrition rate is predicted to decrease progressively during this fiscal year. 

During FY22, HCL added 39,900 people, bringing its total headcount to 208,877. It hired 22,859 freshers last year, and it expects that number to rise by 50% this year.

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