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HomeUncategorizedHCL Tech Q4 net slips 2.8pc to Rs. 1,783 crore

HCL Tech Q4 net slips 2.8pc to Rs. 1,783 crore

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India’s fourth-largest software services firm HCL Technologies Monday posted 2.8 per cent fall in consolidated net profit at Rs. 1,783 crore for June 2015 quarter on account of higher selling, general and administrative (SG&A) expenses.

The company had posted a net profit of Rs. 1,834 crore in the year-ago period, it said in a statement.

However, its consolidated revenues rose 16.1 per cent to Rs. 9,777 crore in April-June as against Rs. 8,424 crore in the same period last year as per US GAAP accounting.

The firm follows July-June as the fiscal year.

“We have invested in delivery and co-innovation centres as well as roped in 100 senior leaders… The growth has been broad-based with all verticals posting strong double-digit performance in 2014-15,” HCL Technologies President and CEO Anant Gupta said.

The pipeline is bigger and buoyant and HCL remains positive on the way market is performing, he added.

Reacting to the results, the company’s scrip fell to Rs. 937.40, down 5.94 per cent from its previous close on the BSE.

Kotak Securities Head of Private Client Group Research Dipen Shah said the results were lower than expectations, both on the revenues and margins front.

“There was a significant miss on the margin front. The relatively higher utilisation rates coupled with the need to increase sales, marketing investments and investing in emerging businesses may continue to impact profitability in the short term,” he added.

Compared to Rs. 992 crore in the April- June 2014 quarter, the company’s SG&A spends stood at Rs. 1,248 crore, up 25.8 per cent.

Its total headcount was recorded at 1,06,107 with the gross addition of 9,448 people. The utilisation rate stood at 83.5 per cent in the said quarter.

For the full year ended June 30, 2015, its net profit moved up 13.9 per cent to Rs. 7,254 crore as against Rs. 6,369 crore in the previous year.

Revenues rose 12.6 per cent to Rs. 37,061 crore during the year compared with Rs. 32,917 crore in 2013-14.

“FY’15 also saw us signing of 58 transformational engagements with more than USD 5 billion of total contract value,” he said.

These bookings saw significant momentum driven by next-gen IT outsourcing, engineering services outsourcing, digital and modern apps deals.

These engagements reflected a broad-based spread across verticals, service lines and geographies.

Talking about capital expenditure in the coming year, CFO Anil Chanana said the company is expected to spend 3-4 per cent of the revenue on the same, compared to about 3 per cent in the past few years.

In the US dollar terms, HCL Technologies reported an 8.8 per cent decline in net profit for the June quarter to USD 278.7 million as against USD 305.4 million in the corresponding period a year earlier.

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