HCL Technologies Limited Q1 FY23 – Earning Highlights | Globe Capital
12-Jul-2022
HCL Technologies Limited Q1 FY23 – Earning Highlights

The Company has posted earnings in line with the market expectations. .          

Q1 FY23 Overview and Verdict
CMP
Rs. 930
Verdict
In line with the market estimates

Q1FY23 Earning Key Highlights

  • Revenue for the quarter rose 16.92% YoY to Rs 23,464 crore compared with Rs 20,068 crore in the same quarter last year.
  • The Company reported a 2.4% year-on-year rise in consolidated net profit at Rs 3,283 crore in the June quarter compared with Rs 3,205 crore in the same quarter last year.
  • Ebitda margin stood at 21.2% against 22.4% in March and 25.2% in the June quarter of last year.
  • Ebit margin for the quarter came in at 17% compared with 18% in the March quarter and 19.6% in the year-ago quarter.
  • The Company has posted an EPS of Rs 12.13 as compared to Rs 11.81 last year.
  • New deal wins amounted to $2,054 million for the quarter, up 23.4% YoY. Out of this, Services’ total contract value (TCV) stood at $ 1,950 million, with included a net seven large deal wins. Products TCV stood at $ 104 million, which included nine net deal wins.
  • The Company has declared an interim dividend of 10/- per share.

 Management Takeaways

  • FY2023 Guidance – Revenue expected to grow between 12% to 14% in constant currency & EBIT margin expected to be between 18% to 20%.
  • Its new bookings grew 23.4% YoY, supported by a good mix of large and mid-sized deals, and pipeline remains near-record high. Its operating margin came in at 17%. It has put in place the right measures that will improve its profitability going forward.
  • Its cash generation continues to be robust at operating cash flow of $2,013 million and free cash flow (FCF) of $ 1,762 million, on last twelve-month basis, with OCF /NI at 112%.

Valuation & View

At the CMP of Rs 930, the stock is trading at annualised P/E multiple of 18.9 times with the annualised EPS of Rs 49.2, which is fairly valued.

 

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