The IT company has maintained its full year constant currency revenue growth guidance at 14-16 percent and also retained EBIT margin guidance at 18.5-19.5 percent
Software services company HCL Technologies has reported a 13 percent sequential decline in June quarter (Q1) profit at Rs 2,220 crore, dented by operating income, but maintained full year revenue growth guidance.
The profit in previous quarter was Rs 2,568 crore. The year-on-year profit fall was 7.6 percent.
Revenue was ahead of estimates at Rs 16,425 crore in the quarter ended June 2019, growing 2.7 percent sequentially and 18.7 percent year-on-year, the company said in its BSE filing.
Revenue in dollar terms increased 3.8 percent quarter-on-quarter (15 percent YoY) to $2,364 million and the same in constant currency grew by 4.2 percent QoQ (up 17 percent YoY).
"We have started FY20 on a very strong note with quarterly revenue growth of 4.2 percent QoQ and 17 percent YoY in constant currency. With our current momentum, we aspire to register an industry-leading organic growth in FY20," C Vijayakumar, President & CEO said.
"I am confident that our time-tested operating model will deliver margins within guided range this year," he added.
The IT company has maintained its full year constant currency revenue growth guidance at 14-16 percent and also retained EBIT margin guidance at 18.5-19.5 percent.
Revenue was expected at Rs 16,094 crore and dollar revenue at $2,309 million for the quarter, according to a poll of analysts conducted by CNBC-TV18.
Geography-wise, revenue from America increased by 11.7 percent QoQ in constant currency, but Europe business slowed by 8.1 percent and Rest of World segment registered a 10.6 percent fall.
Manufacturing, IT and business services, engineering and R&D services, and products & platforms categories grew by 18.4 percent, 3.6 percent, 5.6 percent and 7 percent QoQ, respectively, in constant currency.
Earnings before interest and tax fell 7.7 percent QoQ to Rs 2,806 crore and margin contracted 180bps QoQ to 17.1 percent in Q1, missing analyst expectations. EBIT was expected at Rs 2,843 crore and margin at 17.7 percent, according to a poll of analysts conducted by CNBC-TV18.
"Margins this quarter was muted in line with our investment strategy to leverage future growth opportunities," C Vijayakumar said.
During the quarter, HCL closed its previously announced $1.8 billion acquisition of select IBM products for security, marketing, commerce, and digital solutions.
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