Buoyed by strong growth across verticals, HCL Technologies, on Wednesday, posted better-than-expected 67.3 per cent jump in fourth quarter net profit.
The company, which follows July-June financial year, registered a net profit of Rs.854.10 crore in the April-June quarter of 2012 against Rs.510.50 crore in the year-ago period.
“We saw strong growth in key service offerings, led by infrastructure management services (9.2 per cent quarter-on-quarter growth), enterprise applications services (4.8 per cent) and engineering and R&D services (3.9 per cent),” HCL Technologies Vice-Chairman and CEO Vineet Nayar said.
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HCL Technologies total income rose by 37.7 per cent to Rs. 5,919.1 crore during the quarter from Rs. 4,299.5 crore in the same quarter last fiscal. Though the macro-economic environment continues to be weak, we continue to be bullish about increasing our market share,” he told reporters here.
The domestic IT industry is facing challenges in the U.S. and European markets, which accounts for over 80 per cent of their revenues, due to the uncertain economic and political climate.
Shares of HCL jumped to Rs.513.75, closing 6.68 per cent higher than Tuesday’s close on the BSE. Though HCL does not give revenue guidance, it is confident of maintaining its growth rate in the coming quarters.
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For fiscal 2011-12, HCL Technologies reported a 47.8 per cent jump in its consolidated net profit at Rs.2,526 crore, while revenues grew 31.2 per cent to Rs.21,031.2 crore.
“For the first time, we crossed $4 billion in terms of revenue,,” Mr. Nayar said.
In the fourth quarter, the Americas, Europe and Rest of the World (RoW) markets grew by 2.7 per cent, 7.1 per cent and 6.9 per cent, respectively.
The company signed eight multi-year, multi-million transformational deals, while in the fiscal 2012, it won 52 deals.
In terms of verticals, the growth was led by healthcare (quarter-on-quarter growth of 22.9 per cent); energy, utilities and public sector (13.1 per cent); financial services (5.2 per cent); and media publishing and entertainment (4.4 per cent).
“Our operating cash flows have continued to be in excess of net income. In the last five years, we have returned close to 60 per cent of the free cash flows generated to our shareholders as dividend and this fiscal we achieved 26 per cent return on equity, highest in the last five years,” HCL Technologies CFO Anil Chanana said.
Cash and cash equivalents stood at Rs.667.3 crore as on June 30, 2012.
“With increased thrust on industrialisation and profitable growth, HCL has promoted Anant Gupta as President and Chief Operating Officer,” the company said.
The ‘board of directors of the company has recommended a final dividend of Rs.4 per equity share of Rs.2 each for the year ended June 30, 2012.
During the quarter, HCL Tech added 7,008 people (gross) and 1,855 employees (net), taking the total headcount to 84,319. The attrition level stood at 14 per cent in the April-June 2012 quarter.
The company will give wage hikes to its employees in July and October. “Seventy per cent of our employees will be given hikes in July, while the remaining 30 per cent, majorly comprising the management, will get hikes in October,” Mr. Nayar said.