HomeEarnings NewsHCL Tech says attrition stabilising and fresher hiring to be scaled up

HCL Tech says attrition stabilising and fresher hiring to be scaled up

HCL Technologies, on Thursday, posted a 226 percent jump in its net profit, beating Street expectations. However, its revenue dipped mainly dragged by its products and platform business. The company has guided for a revenue growth of 12-14 percent for FY23. In an interview with CNBC-TV18, C Vijayakumar, CEO & MD, and Prateek Aggarwal, CFO, HCL Technologies, shared their insights on the company's quarterly earnings as well as attrition and hiring outlook. The management has a target to get 30,000 plus freshers on board next year.

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By Reema Tendulkar  April 22, 2022, 1:10:33 PM IST (Updated)

HCL Tech says attrition stabilising and fresher hiring to be scaled up
HCL Technologies CFO Prateek Aggarwal told CNBC-TV18 that attrition is starting to stabilise for the company, and expected to ease further in the next few quarters.



"March quarter previous year was one of our lowest attrition quarters. So this quarter is actually just a shade lower than last quarter. And I think it's starting to stabilise and hopefully, it will come down next quarter onwards. So yes, that that should stabilise going forward, fingers crossed," he said.

His remarks come at a time when the IT space has been grappling with elveated recruitment costs on the back of high attrition rates. With the rise in the number of jobs in the IT space owing to growth even during the COVID-19 pandemic, employers within the space have found it tough to retain talent intact without compromising margins.

Also Read | HCL Tech is getting a lot of love from analysts — targets indicate at least a 20% jump hereon

Aggarwal explained that the company’s strategy has been to get more and more freshers on-board. In fact, the fresher intake has risen over 50 percent in the last 3-4 years, he mentioned. He reckons that freshers hiring will be a whopping 30,000 plus next year. The figure has risen from 9,000 in 2003 and was in the range of 22,000-23,000 in the last year.

"As a company we have been hiring more and more freshers every year and we have been increasing the number of fresher intake at something like 50 percent for the last two or three years. Last year, I think we did about 22,000-23,000, something like that. So we would target to meaningfully increase that. But at the same time, it is a balancing game between how many we take in and how many we are able to make productive and start billing. So that's the reason it's a moving target," he explained.

"I would certainly hope for a number nearer 30,000 or even beyond for the next year. Let's see how we how we go towards that number. It is a huge increase. I think a couple of years back, it was around 9,000. Then it became 13,000 and this year, we did 22,000. So it is a moving number and moving up fast," he added.

He also said the company has an agile model when it comes to salary hikes, and expects to bring down the cost by balancing hiring and making the new hires more productive in order to improve margins, going ahead.



IT major HCL technologies, on Thursday, posted its financial results for the January-March period. The company's stellar 226 percent jump in net profit to Rs 3,593 crore for the quarter ended March 2022 exceeded Street expectations. It had reported a net profit of Rs 1,102 crore for the corresponding period a year ago.

Its revenue from operations for the final three months of the year ended March 2022 came in at Rs 22,597 crore, up 15 percent on a year-on-year basis.

The company's products and platform business fared badly in Q4 dragging the overall revenue. CEO and Managing Director C Vijayakumar, said that this vertical will be volatile going forward. He explained that it will start to see gradual growth as it's still a new business.

"It's a new business so it's going to take some time to get to a good trend, and line. I think the fundamental aspect is that this lumpiness is likely to be there. It can be year-on-year (YoY) or quarter-on-quarter (QoQ) because 30 percent of the revenue depends on new product license sales and that can always move around a little bit.  We aren't too worried. We are staying the course," he said.

He mentioned that it is a strategic bet for the company, however services business will grow much faster than products business.



On the back of its performance, shares of HCL Tech were trading 2 percent higher in early trade on Friday. It is currently trading at Rs 1,119.40, up around 20 percent in the last one day alone, on the Bombay Stock Exchange (BSE).

On Thursday, the stock closed 0.92 percent higher at Rs 1,099.60 on BSE. Market cap of the firm rose to Rs 2,98,394.61 crore.

Watch the video for the full interview.

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