HCL Tech share price: Targets suggest limited upside; what JPMorgan, Jefferies, Citi say
HCL Tech: Nuvama Institutional Equities said HCL Tech’s services business is quite stable, but the Software business is dragging overall growth.
- Oct 13, 2026,
- Updated Oct 13, 2026 9:12 AM IST
HCL Technologies Ltd (HCL Tech) received rating upgrades from at least three brokerages following its September quarter results. Despite this, the 12-month consensus target for HCL Tech stands at Rs 1,277.55, implying limited upside ahead.
Ravi Menon of Axis Capital set a target price of Rs 1,530, the highest on the Street, while Surendra Goyal of Citi set a target of Rs 1,050, the lowest, according to 26 analyst targets compiled by Business Today from Bloomberg.
Analysts said while the FY27 guidance was raised, organic growth guidance stayed unchanged at the midpoint. They said large-deal ramp-up will support FY28 growth for HCL Tech.
Pipeline and bookings may support near-term growth outlook, even as macro uncertainty remained, MOFSL said.
Q2 hits & misses Nomura said HCL Tech's Q2 dollar revenue at Rs 3,724 million, up 2.3 per cent QoQ, came in below the consensus estimate of 2.7 per cent QoQ and included 97 basis points of inorganic contribution. It said net new deal wins at $3.3 billion was up 27 per cent YoY.
HCL Tech's EBIT margin came in at 18.2 per cent, up 130 basis points QoQ, above the consensus expectation of 17.6 per cent. It also declared a dividend of Rs 12 per share.
"We raise our FY27-28 EPS by 2-3 per cent to factor in the 2Q results. Our TP increases to Rs 1,330 (from Rs 1,310), set at unchanged 16 times FY28 EPS," it said.
HCL Tech revised its revenue growth guidance to 3-4 per cent YoY for services from 1.5-4.5 per cent previously and 2.5-4 per cent overall from 1-4 per cent previously. This includes inorganic contribution of 62 bps and 87 bps for services and overall company, respectively. HCL Tech clarified that the mega deal won in early July would ramp up meaningfully only in the March quarter of 2027.
AI revenue MOFSL noted Advanced AI revenue grew 28.4 per cent QoQ in constant currency (CC) terms and 78 per cent YoY CC to $219 million, equivalent to 5.9 per cent of quarterly revenue, with an annualized run rate of $876 million. Higher-margin AI services contributed 32 bps to sequential EBIT margin expansion, while management indicated that Advanced AI services margins are expected to be 7–10 percentage points above traditional services. Non-AI revenue remained subdued, declining 1 per cent YoY.
"We continue to like HCLT's all-weather portfolio. Its investments in Sarvam and the AI data center business strengthen its long-term AI positioning. We have increased our EPS estimates for FY28E by 1.9 per cent and reiterate our BUY rating with an unchanged TP of Rs 1,450 based on 18x FY28E EPS. We maintain HCLT as our preferred pick in the large-cap space," MOFSL said.
Margin guidance Nirmal Bang said the management has retained its EBIT margin guidance of 17.5-18.5 per cent, indicating limited improvement in its profitability outlook despite a strong Q2 performance. Although record H1 bookings and strong Advanced AI growth are positives, the brokerage remained cautious about the sustainability of organic growth and the extent to which AI-led opportunities can offset deflationary pressures across traditional services.
"We remain underweight on the sector as highlighted in our 1QFY27 Result Review. Accordingly, we maintain our ‘SELL’ rating on HCLT; valuation is based on unchanged 13x blended EPS of Rs78, translating into a target of Rs 1,014," it said.
Risk-reward unfavourable Nuvama Institutional Equities said HCL Tech’s services business is quite stable, but the Software business is dragging overall growth. An already high premium over TCS and Infosys, for similar growth, makes the risk-reward unfavourable.
"We tweak our FY27E/28E EPS. Retain ‘HOLD’ with unchanged target of Rs 1,250 valued at 16x average of FY28–29 PE—currently trading at 16x FY28 PE," it said.
HCL Technologies Ltd (HCL Tech) received rating upgrades from at least three brokerages following its September quarter results. Despite this, the 12-month consensus target for HCL Tech stands at Rs 1,277.55, implying limited upside ahead.
Ravi Menon of Axis Capital set a target price of Rs 1,530, the highest on the Street, while Surendra Goyal of Citi set a target of Rs 1,050, the lowest, according to 26 analyst targets compiled by Business Today from Bloomberg.
Analysts said while the FY27 guidance was raised, organic growth guidance stayed unchanged at the midpoint. They said large-deal ramp-up will support FY28 growth for HCL Tech.
Pipeline and bookings may support near-term growth outlook, even as macro uncertainty remained, MOFSL said.
Q2 hits & misses Nomura said HCL Tech's Q2 dollar revenue at Rs 3,724 million, up 2.3 per cent QoQ, came in below the consensus estimate of 2.7 per cent QoQ and included 97 basis points of inorganic contribution. It said net new deal wins at $3.3 billion was up 27 per cent YoY.
HCL Tech's EBIT margin came in at 18.2 per cent, up 130 basis points QoQ, above the consensus expectation of 17.6 per cent. It also declared a dividend of Rs 12 per share.
"We raise our FY27-28 EPS by 2-3 per cent to factor in the 2Q results. Our TP increases to Rs 1,330 (from Rs 1,310), set at unchanged 16 times FY28 EPS," it said.
HCL Tech revised its revenue growth guidance to 3-4 per cent YoY for services from 1.5-4.5 per cent previously and 2.5-4 per cent overall from 1-4 per cent previously. This includes inorganic contribution of 62 bps and 87 bps for services and overall company, respectively. HCL Tech clarified that the mega deal won in early July would ramp up meaningfully only in the March quarter of 2027.
AI revenue MOFSL noted Advanced AI revenue grew 28.4 per cent QoQ in constant currency (CC) terms and 78 per cent YoY CC to $219 million, equivalent to 5.9 per cent of quarterly revenue, with an annualized run rate of $876 million. Higher-margin AI services contributed 32 bps to sequential EBIT margin expansion, while management indicated that Advanced AI services margins are expected to be 7–10 percentage points above traditional services. Non-AI revenue remained subdued, declining 1 per cent YoY.
"We continue to like HCLT's all-weather portfolio. Its investments in Sarvam and the AI data center business strengthen its long-term AI positioning. We have increased our EPS estimates for FY28E by 1.9 per cent and reiterate our BUY rating with an unchanged TP of Rs 1,450 based on 18x FY28E EPS. We maintain HCLT as our preferred pick in the large-cap space," MOFSL said.
Margin guidance Nirmal Bang said the management has retained its EBIT margin guidance of 17.5-18.5 per cent, indicating limited improvement in its profitability outlook despite a strong Q2 performance. Although record H1 bookings and strong Advanced AI growth are positives, the brokerage remained cautious about the sustainability of organic growth and the extent to which AI-led opportunities can offset deflationary pressures across traditional services.
"We remain underweight on the sector as highlighted in our 1QFY27 Result Review. Accordingly, we maintain our ‘SELL’ rating on HCLT; valuation is based on unchanged 13x blended EPS of Rs78, translating into a target of Rs 1,014," it said.
Risk-reward unfavourable Nuvama Institutional Equities said HCL Tech’s services business is quite stable, but the Software business is dragging overall growth. An already high premium over TCS and Infosys, for similar growth, makes the risk-reward unfavourable.
"We tweak our FY27E/28E EPS. Retain ‘HOLD’ with unchanged target of Rs 1,250 valued at 16x average of FY28–29 PE—currently trading at 16x FY28 PE," it said.