In the first quarter of FY2025, HCL Technologies saw a 20.45% rise in net profit, reaching ₹4,257 crore, while revenue from operations grew by 6.69% to ₹28,057 crore.
HCL Technologies (HCLTech) announced strong growth in its Q1 FY2025 results. The IT major reported a 20.45% rise in net profit to ₹4,257 crore, compared to ₹3,534 crore in the corresponding quarter of the previous year. Revenue from operations increased by 6.69% to ₹28,057 crore in Q1FY2025, up from ₹26,296 crore in Q1FY2024. The results surpassed market expectations, reflecting significant growth in both net profit and revenue during the April-June quarter.
Prateek Aggarwal, Chief Financial Officer at HCL Technologies, commented, “HCLTech achieved a 6.7% year-on-year growth in INR revenue, which is commendable given the global economic environment. Our EBIT margins stood steady at 17.1% compared to the previous year. We recorded a PAT of ₹4,257 crore for the quarter, marking a 20.4% year-on-year growth. Our cash flow generation remains robust, with LTM FCF amounting to ₹21,637 crore, which represents 133% of PAT and 88% of EBITDA.
“We are dedicated to enhancing our capital efficiency and are pleased to announce that the Last Twelve Month (LTM) Return on Invested Capital (ROIC) for the company has increased by 350 basis points year-on-year to 34.6%. For our Services business, LTM ROIC has risen by 476 basis points year-on-year to 42.8%,” he stated.
Here are the 5 key highlights from HCL Technologies’ Q1 performance:
P&L Account:
HCL Technologies reported a 20.45% increase in net profit, reaching ₹4,257 crore in the April to June quarter, compared to ₹3,534 crore in Q1FY24, with a focus on enhancing capital efficiency. The company’s income grew by 6.8% compared to the previous quarter of FY24.
Revenue from operations saw a year-on-year rise of 6.69%, amounting to ₹28,057 crore in the April to June quarter. However, INR revenue decreased by 1.6%, and USD revenue dropped by 1.9% quarter-on-quarter.
The company’s pre-tax profit or EBIT rose by 7.5% compared to Q1FY2024 figures but declined by 4.4% compared to the previous quarter.
Dividend announcement:
The third-largest IT company has announced an interim dividend of ₹12 per share of ₹2 each for FY25. The dividend will be issued to shareholders on July 23, as declared by the board of directors in an exchange filing.
Attrition rate in the last 12 months:
In the April to June quarter of FY2025, HCL Technologies reported an attrition rate of 12.8%. According to the filing, the company’s total employee count as of June 30, 2024, stands at 2,19,401. HCL Tech also recruited 8,080 employees, including 1,078 freshers.
Revenues by verticals:
The IT company experienced a 4.1% decline in revenue in its Lifesciences and Healthcare sector. Similarly, the Financial Services and Public Services segments, which include Energy and Utilities, Travel-Transport-Logistics, and Government, saw declines of 1.3% and 3.7% year-on-year, respectively.
Conversely, HCL Tech’s Telecommunications, Media, Publishing & Entertainment vertical witnessed a significant 69.2% increase in revenue compared to the previous year.
As of June 30, 2024, HCL Tech’s new deal wins amounted to $1.96 billion.
Guidance for FY2025:
HCL Technologies anticipates revenue growth of 3 to 5 percent year-on-year in constant currency (CC) terms. Service revenue is also projected to grow within the range of 3 to 5 percent year-on-year, with an expected EBIT margin between 18 and 19 percent, as stated in the company’s press release.
“We are optimistic about robust growth in the upcoming quarters, which positions us well to achieve our revenue guidance for the year, driven by client investments in GenAI and other emerging technologies,” commented C Vijayakumar, Chief Executive Officer of HCL Technologies Limited.
Following the announcement of the results after market hours, HCL Tech shares closed 3.20% higher at ₹1,560.60, compared to the previous close of ₹1,512.
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