HCLTech Q1 FY25 Preview Margins to Shrink 70 bps, Net Profit Down 4.7%

On July 12, HCL Technologies, a prominent Tier-I IT company with substantial exposure to the US market, is set to make its Q1 FY25 results announcement. For the April–June quarter, the massive IT services company headquartered in Noida is expected to report a muted performance. Analysts predict a 4.7% drop in overall net profit to Rs 3,800 crore from the Rs 3,986 crore recorded in the prior quarter.

HCLTech Q1 FY25 Preview Margins to Shrink 70 bps

HCLTech Q1 FY25 Preview Margins to Shrink 70 bps

Additionally, a 2% sequential decline in revenue is anticipated, from Rs 28,499 crore to Rs 27,930 crore. Revenue is predicted to decrease by 2.1% in US dollars, from $343 million in Q4 FY24 to $335.9 million. When quantified in Revenue is predicted to exhibit a 2.3% sequential fall in constant currency terms. This fall is attributed by InCred Equities to the seasonal pass-back of productivity gains.

It is anticipated that earnings before interest and taxes (EBIT) for the June quarter will be Rs 4,718 crore, a 6.1% sequential decrease from the previous quarter’s Rs 5,024 crore. Additionally, forecasts indicate that the company’s margins will decline, falling 70 basis points to 16.9% from 17.6% in the March quarter.

HCL Service sector, HCLTech Q1 FY25 Preview Margins to Shrink 70 bps

The IT services sector of HCL is expected to contract by 3% on a quarterly basis. The company is anticipated to retain its revenue and margin guidance for FY25 at 3-5% and 18-19%, respectively, in spite of these difficulties.

According to AnandRathi’s analysis on the IT services sector, companies are experiencing salary hikes and increased visa expenses, which is causing their Q1 margins to marginally decline. The sequentially lower profits anticipated in Q1 are partly attributable to the US’s approximately 70% rise in visa fees.

Principal Trackers in HCL’s Q1 FY25 Report:

  • FY25 forecast
  • Product/ERD business outlook
  • Deal Total Contract Values (TCVs) and pipeline

SBI and Apobank awarded HCL major deals during the reporting period. Investors will be eagerly monitoring HCL’s stock movement as the earnings release draws near.

Read more post…

  1. Groww Account- https://app.groww.in/v3cO/kyrp1zph
  2. Kotak neo Account https://kotaksecurities.ref-r.com/c/i/32531/109103906

Leave a comment