HCL banks on lucrative deals in the pipeline

HCL Tech founder and CEO Shiv Nadar. HCL Tech founder and CEO Shiv Nadar.

Strong growth in infrastructure services and financial and manufacturing verticals helped HCL Technologies post 59 per cent jump in net profit to  Rs 1,624 crore in the third quarter compared to  Rs 1,021 crore in the January-March quarter of 2012-13. HCL follows a July-June financial year. Revenue from infrastructure services grew 31.5 per cent year-on-year, the Noida-based firm said on Thursday.

Revenue increased 29.8 per cent to Rs 8,349 crore from Rs 6,430 crore a year earlier beating market expectations. HCL president and chief executive officer Anant Gupta said, "The application services business showed a robust performance." Though the company does not provide revenue forecasts, Gupta exuded confidence in aggressively winning deals especially in the rebid market. "There is significant momentum in the rebid market. We are competing with large international firms and winning deals. In Q3 alone, we have signed 12 transformational deals. The deal pipeline continues to be robust and should give us good momentum," Gupta said. In dollar terms, net profit grew 39.9 per cent to $264.2 million while revenue rose 14.3 per cent to $1.36 billion in Q3 of FY14 from a year ago. Sequentially, net profit climbed 8.5 per cent from Rs 1,496 crore and revenue was up two per cent from Rs 8,184 crore in the October-December quarter. The company announced an interim dividend of Rs 4 per equity share of face value of Rs 2.

During the quarter, HCL added 8,291 people (gross) and 1,858 (net) employees taking the total headcount to 90,190 as on March 31, 2014. Gupta added that while Europe continues to do well, the rest-of-theworld segment showed significant growth on the back of a large systems integration deal. HCL added two clients each in the $50-million and $30-million categories. Our success with the industrialised delivery model, increasing number of contracts moving into steady state, savings on G&A front, helped in improved net income margin of 19.4 per cent this quarter, up from 15.9 per cent in the corresponding quarter of last year, chief financial officer Anil Chanana said.

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