HCL Tech Shares Jump Nearly 6% After Earnings Announcement

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HCL Technologies shares jumped over 5 per cent on Thursday, a day after the IT major reported a net profit of Rs. 2,230 crore in the April-June period. That meant a decline of 12.55 per cent from the company’s net profit in the previous quarter. In a regulatory filing after market hours on Wednesday, the IT company said its revenue from operations stood at Rs. 16,427 crore in the quarter ended June 30, marking a fall of 2.73 percent on a sequential basis.
On the Bombay Stock Exchange, HCL Tech shares opened higher at Rs. 1,029 apiece, and jumped as much as 5.06 per cent to Rs. 1074.00 during the session. On the National Stock Exchange (NSE), HCL Technologies shares jumped 5.63 per cent to touch an intraday high of Rs. 1,080.20.

In dollar terms, its revenue grew 3.8 per cent on a quarter-on-quarter basis to $2,364 million. In constant currency terms, HCL Tech said its revenue rose 4.2 per cent compared to the quarter ended March 31.

HCL Tech shares traded with high volumes and were the top percentage gainers on benchmark indexes Sensex and Nifty on Thursday.

At 2:03 pm, HCL Tech shares traded 5.54 per cent higher at Rs. 1,078.90 apiece on the BSE, outperforming the benchmark Sensex index which was up 0.62 per cent.

By then, 0.87 lakh shares had changed hands during the session, as against an average of 0.39 lakh over the past two weeks, data from the BSE showed.

The IT company maintained its guidance for financial year 2019-20, with revenues expected to grow between 14 per cent and 16 per cent in constant currency terms. HCL Tech said it expects its operating margin (EBIT) to grow in the range of 18.5-19.5 per cent.

The company’s revenue from its IT and business services operations increased 1.98 per cent to Rs. 12,364 crore in the first quarter of the current financial year. Revenue from engineering and R&D services rose 4.66 per cent to Rs. 2,783 crore, according to the regulatory filing.

HCL Tech’s board declared an interim dividend of Rs. 2 per share.

The company said it completed a previously announced $1.8-billion acquisition of select IBM products on June 30, 2019. The group had signed a definitive agreement to acquire business relating to select IBM software products for Rs. 12,252 crore.

The group has paid Rs. 5,608 crore ($812.5 million) till June 30, 2019, and the balance amount is payable in tranches till July 30, 2021, the company said.

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