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HCL Tech: Core concerns remain!

(Oct 26, 2004)

HCL Technologies has announced poor results for the first quarter of FY05. The company has reported a sequential decline in profits on the back of a marginal growth in the topline. Lower other income and high tax outgo has dented the company’s profits in the quarter. Operating margins have remained steady.

HCL Tech: Is it turning around?

(Mar 23, 2004)

HCL Technologies is one domestic software company that has not only borne the brunt of poor performances during the slowdown but has also suffered on account of its inorganic growth strategy going sour on a number of occasions. In this write-up, we would briefly discuss about the company’s present situation and see where it is likely to be headed going forward.

HCL Tech: Organic growth

(Nov 1, 2003)

HCL Tech (on a consolidated basis) announced its 1QFY04 results yesterday, reporting a sequential topline growth of 19%. Notably, this significant growth in the company's revenues has come about after a string of poor performances in the recent past. Increased taxation liability has, however, caused the company's bottomline to decline by a marginal 1% sequentially. Notably, HCL Tech managed to improve upon its operating margins for the quarter (rise of 70 basis points).

HCL Tech 3QFY03 net down 25%

(Apr 28, 2003)

HCL Technologies has posted a negative growth of 25% in its consolidated net profit for 3QFY03, while consolidated revenue growth has been flat sequentially. For the nine months ended March 2003, the company saw its consolidated topline grow by 16%, but continuing pressure on operating margins brought down its net profit by 38%. Operating margins have fallen by 400 basis points in 9mFY03.

BPO: Hurt by protectionism?

(Mar 11, 2003)

BPO (business process outsourcing) is expected to be the next growth engine for the IT industry that is passing through a rough patch. In the recent past, expectations of a swift growth in the industry have been tarnished by moves in the US to block jobs being outsourced to India. While Nasscom and IT services companies have maintained that such a move is unlikely to have an impact on the sector, we feel that this could slower the rate of growth in outsourcing.

Software: R&D - slow outsourcing

(Feb 17, 2003)

Not so long ago, the top rung Indian software companies could be divided into two groups. One that focused on technology solutions and the others that were more focused on business related solutions. At one time, revenues from the telecom vertical were taken as an indication of the company doing high-end work. However, post the technology meltdown, the same is being termed as ‘exposure’, very much the same way that dot-coms are referred to today.

HCL Tech: The favoured child

(Dec 18, 2002)

In a surprise move, HCL Technologies has announced plans to acquire the software exports business of a group company, HCL Infosystems. The acquisition will be made by issuing 7 m shares of HCL Technologies to shareholders of HCL Infosystems. For every seven shares of HCL Infosystems held, shareholders will get 2 shares of HCL Technologies.

HCL Technologies: Disappointing performance

(Oct 22, 2002)

HCL Technologies numbers are disappointing. The company’s revenues have grown by just 2% sequentially. The bottomline has grown by 10% on a QoQ basis. However, the numbers for 4QFY02 include a write off of Rs 367 m. Excluding the write-off from 4QFY02 numbers, HCL Technologies’ net profit has infact fallen by a steep 28% sequentially.

HCL Technologies: A lot to come?

(Sep 11, 2002)

HCL Tech pleased the markets with its performance for 4QFY02. The software major recorded a 6% sequential growth in revenues. However, the net profit figured almost halved as compared to 3QFY02. This is due to a write off amounting to Rs 367 m and a decline in operating margins. While the company finally saw volumes growing in 4QFY02, falling realisations to eroded margins.

HCL Tech: Bottomline blues…

(Aug 30, 2002)

HCL Tech, the fourth largest software company in the country, has announced an encouraging 16% topline growth in FY02. Bottomline has however, disappointed with an 11% dip, on account of a Rs 612 m write off for doubtful debts and markdown in investments.

HCL Tech: Reading between numbers

(May 29, 2002)

Infosys’ practice of telling all to its shareholders has created a race amongst its peers to disclose more and more. Post the quarter-ended December it was Satyam that started dramatically improving the level of disclosure. The latest to join the list is HCL Technologies, which has joined the list of ‘bare all’ from quarter ended March.

HCL Technologies: Inorganic growth

(Apr 23, 2002)

HCL Technologies’ inorganic growth model is paying off. The company for 3QFY02 posted a 2% sequential rise in topline. However, the rise in net profits has been steeper at 6% based on a significant rise in other income.

HCL Tech: Below expectations

(Jan 22, 2002)

The 2QFY02 consolidated numbers for HCL Technologies and its subsidiaries are below market expectations. On a sequential basis, the topline has grown by 8% and the net profits have jumped by 25%. The growth in net profits is including an extraordinary write off in 1QFY02. Excluding this, the growth would have been 1%. On a YoY basis, the results indicate a 17% growth in revenues and a 4% growth in bottomline.

HCL Tech: Margins under pressure

(Jan 22, 2002)

HCL Technologies Ltd. that accounts for about 55% of the consolidated revenues of HCL Technologies and its subsidiaries has posted a 1% sequential growth in topline and a 7% decline in net profits for 2QFY02. The decline in net profits is due to operating margins falling and a lower other income figure. On a YoY basis, the revenues have declined by 4%, while the drop in bottomline is steeper at 12%. The operating margins have decline very sharply compared to 2QFY01. The figure has reduced from 5

HCL Tech: In line with expectations

(Oct 23, 2001)

HCL Technologies has posted a 0.9% sequential growth in topline for 1QFY02. However, the bottomline has dipped by 26%. This is including extra-ordinary expenses of Rs 240 m. Excluding the extra-ordinary income and non-cash sales incentives the bottomline has dipped by 9% QoQ. The extra-ordinary item of Rs 240 m is a write off for doubtful debts and diminution in the value of investments. On a YoY basis the topline has grown by 17% and the bottomline has grown by 20% excluding extra-ordinary expe

HCL Tech: Strengthening service offerings

(Sep 27, 2001)

HCL Technologies has picked up a 51% stake in Deutsche Software Ltd., the IT services subsidiary of Deutsche Bank in India. HCL Tech will acquire the remaining 49% at the end of 3 years through the issuance of HCL Tech's equity shares to Deutsche Bank. Currently, the valuations for the deal are not available.

HCL Tech: Steady performance

(Aug 7, 2001)

For the year FY01, the company added 71 new clients taking the total number of clients to 340. Of the 71 clients added, 14 were Fortune 500 companies. HCL Tech's revenues from top 5 and top 10 clients stood at 21% and 31% respectively. These figures are comparable to other top rung software majors.

Where emerging technologies is the buzzword

(May 12, 2001)

Every industry has a story to tell. The software industry in India is the story of middle class Indians, who broke free from the shackles of "babudom". Working hard on the only wealth they had i.e. knowledge, they have successfully managed to create world-class organisations. Organisations that have broken all myths and have established that the true wealth of a nation are its people, their entrepreneurial spirit and knowledge.

HCL Tech: Value added growth

(Apr 19, 2001)

HCL Tech posted a sequential (QoQ) growth of 6% in revenues (consolidated numbers). The rise in net income is just 2.7%. On a YoY basis the growth in the topline is 53% while the rise in net profit is 96%. The company has beaten market expectations with the financials it has posted.

HCL Tech: Beats expectations

(Apr 19, 2001)

HCL Tech has reported growth in revenues by 85% and the rise in net profit by 117.5% (YoY). However, the company has posted a flat revenue growth of 1.7% and a marginal dip of 2% in net profits on a QoQ basis for 3QFY01.


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