HCL Tech Q4 Results: Net profit rises to ₹3,986 cr, revenue up 7% YoY

India’s third-largest IT services company by market capitalization, HCL Technologies, reported a net profit of ₹3,986 crore for the fourth quarter that ended on March 31, 2024. This is slightly higher than the ₹3,983 crore reported a year ago. The company’s revenue during January-March 2024 stood at ₹28,499 crore, which is 7.11% higher than the ₹26,606 crore reported in the year-ago period.

On a quarterly basis, HCL’s net profit declined by 8.36% compared to ₹4,350 in the December 2023 quarter. The consolidated revenue from operations was reported at ₹28,499 crore, up 5.3% from ₹27,059 crore in Q4FY23.

The board declared an interim dividend of ₹18 per share equity share of ₹2 each of the company for the financial year 2024-25. The payment date for the interim dividend is set for May 15, 2024.

Read Also: 

• Infosys Q4 Results: Profit jumps 30% YoY to ₹7,969 crore
• TCS Q4 results: Profit rises 9% to Rs 12,434 crore, revenue up 3.5%
• Wipro Q4 Results: Profit falls 8% YoY to ₹2,835 cr, revenue dips 4% YoY

At a time when other IT majors like TCS, Infosys, Wipro, and Tech Mahindra are reporting a decline in net headcount, HCL Technologies added 2,725 employees during the January-March 2024 quarter. The attrition rate decreased from 12.8% in the December quarter to 12.4% at the end of March this year. It had previously been at 19.5% in Q4FY23. The headcount now stands at 227,481, with a net addition of 1,537 individuals. The company also reported that it had hired 12,141 freshers.

C Vijayakumar, CEO & Managing Director of HCLTech, said, "HCL Tech continues to lead the industry in FY24 with good USD revenue growth of 5.4% YoY during challenging times through our strong commitment to our clients and our people. More importantly, we have translated this growth into even higher value creation for our shareholders with our OCF coming at US$ 2,711 mn, up 21.6% YoY and FCF at $2,584 Mn, up 27.7% YoY.

“As we look ahead, global enterprise technology spending will only grow with the adoption of AI. We are well positioned to capitalize on this with our AI-led propositions, Global delivery model, and an ideal mix of technology services and products,” said Vijayakumar.

Biswajit Maity, Sr Principal Analyst at Gartner, mentioned that while Q4 results may have fallen short of market expectations, it's crucial to consider the broader perspective: the company maintains a promising outlook with a robust business pipeline. Delays in deal signings are attributed to reduced discretionary spending and extended decision-making cycles among customers.

However, Maity said that there are indications of recovery, especially with the anticipated rise in demand for IT services in 2024. “It's important to note that some client feedback suggests dissatisfaction with HCLTech's service quality, underscoring the need for HCLTech to address this to sustain its growth momentum,” he said.

Among the other top IT services majors who announced their Q4 results this week, India's largest software services exporter reported a 9% rise in net profit at ₹12,434 crore, compared to ₹11,392 crore in the corresponding period last year. The IT major's revenue from operations in the fourth quarter rose 3.5% to ₹61,237 crore, which missed estimates. Infosys posted a 30% YoY growth in its consolidated net profit at ₹7,969 crore for the quarter ending March 2024. This is compared to ₹6,128 crore in the same quarter the previous year.

Wipro’s net profit fell by 8% to ₹2,835 crore for the fiscal fourth quarter, compared to the same period last year when it stood at ₹3,074 crore for the Jan-March 2024 quarter. Wipro's consolidated revenue saw a decline of 4.2%, amounting to ₹22,208 crore, down from ₹23,190 crore in the same period last year.

Further, Tech Mahindra reported a 40.9% fall in net profit to ₹661 crore year-on-year for the fourth quarter that ended on March 31, compared to the corresponding period last year. LTIMindtree reported quarterly revenue of ₹8892.9 crore, increased by 2.3% year-on-year from the previous year while facing a decline of 1.3% sequentially.