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HCL sees sequential revenue growth of 6.4%, ups margin guidance for FY21

HCL signed 15 transformational deals in Q2 in key industry verticals like life sciences and healthcare, public services (energy & utilities) and manufacturing

Rukmini Rao | October 16, 2020 | Updated 14:23 IST
HCL sees sequential revenue growth of 6.4%, ups margin guidance for FY21
HCL tech like its peers also announced the resumption of its salary increments effective 1 October to all junior level employees (upto E3 levels)

Noida-based IT company HCL Technologies posted $2,507 million dollars in revenues in September quarter, resulting in a sequential dollar revenue growth of 6.4 per cent. The company which resumed providing annual guidance last quarter upped its operating margin guidance for the full year FY21 from the earlier 19.5-20.5 percent to 20-21 per cent. However, it retained the revenue growth guidance to be in the range of 1.5-2.5 percent in constant currency terms for the remaining two quarters of the fiscal.

The company attributed the pickup to a broad-based growth, winning 15 transformational deals in the quarter. C Vijayakumar, President & CEO, HCL Technologies said, "Our new bookings remained very robust. It increased 35 per cent compared to the last quarter."

The company said that among other things that helped in the quarter's performance were better intensity of deals in the market, stickiness of the clients who were ramping up programmes, early leads in the digital (infrastructure) deals, continued focus in automation and cost optimisation.

Also read: HCL Tech profit rises 18.5% to Rs 3,142 crore YoY in September quarter

Vijaykumar further added that Mode1-2-3 businesses, all have registered growth and Mode 1( digital foundation) recovery is a reflection of increased traction. "We are close to the last year's number, in the next couple of quarters we should be able to reach the previous year's March number," he said.

HCL tech like its peers also announced the resumption of its salary increments effective 1 October to all junior level employees (upto E3 levels). Increments for other will be rolled out starting 1 January. "This is only a 1 quarter shift from our regular increment cycle that we give to our employees annually," said Vijaykumar. With wage hike expected to be around the same levels as last year, Apparao VV, Chief Human Resources Officer said that the company will ramp up its fresher hiring in the next two quarters.

"We have a significant number of lateral hiring that we have to do and a large number of recruitments to happen before December," he said. HCL also announced an interim dividend of Rs 4 per equity share with a face value of Rs 2.  

Also read: Uday Kotak suggests 5 'right sectors' for foreign investors to invest in India

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