Indian IT services company HCLTech Ltd on Thursday reported a higher-than-expected profit for the December quarter helped by strong deal wins, but lowered its full-year revenue view citing seasonal challenges in the fourth quarter.
The company said it won 17 large orders across its services and software segments for the quarter ended March 31, with new deal wins valued at $2.35 billion, up 10% year-on-year. HCLTech forecast full-year revenue growth between 13.5%–14.0%, compared with an earlier view of 13.5%–14.5%.
The company also said it expects its annual services revenue in constant currency to be between 16%-16.5%, compared with the 16%–17% it had forecast earlier, citing seasonal factors in the fourth quarter. There was no indication of a slowdown and the company’s order book remained strong, chief executive C Vijayakumar said in a media conference.
However, he flagged delays in decision making in Europe, inline with comments from larger rival Tata Consultancy Services that had warned of challenges in the region due to rough economic conditions. Meanwhile, other rival Infosys on Thursday raised its annual revenue outlook after a strong deal pipeline.
Consolidated net profit for HCLTech jumped 19% to 40.96 billion Indian rupees, HCL reported in an exchange filing. Analysts on average expected the company to report a profit of 38.56 billion rupees, according to Refinitiv data.
Earnings before income tax (EBIT) margins for the third quarter ending Dec. 31 stood at 19.6%, up from 18% in the previous quarter. HCLTech narrowed its EBIT margins guidance for FY 2023 to 18.0% to 18.5% .
Revenue from operations jumped 19.56% to 267 billion rupees.