HCL Tech Q3 results: IT major records 5.4% increase in net profit at Rs 3,442 cr; revenue at Rs 22,331 cr

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The IT services company said its revenue, in dollar terms, grew 6.7% year-on-year, and a similar percentage quarter-on-quarter, handily beating Street expectations. At the end of trading on the BSE on Friday, HCL closed in the green at Rs 1,337,55 per share, a 0.35% increase.

HCL Technologies Ltd today reported a net profit at Rs 3,442 crore, which was up 5.4 percent quarter-on-quarter, and revenue at Rs 22,331 crore-- up 8.1 percent QoQ--in its earnings report for the quarter ended December 31, 2021, handily beating Street expectations.  
In dollar terms, the IT services company's revenue ($2,977 million) grew 6.7 percent YoY and QoQ, while the constant currency (CC) revenue witnessed 7.6 percent QoQ and 15% YoY increase
In a CNBC-TV18 poll, analysts had predicted a net profit of Rs 3,390 crore and revenue of Rs 21,674 crore, and a dollar revenue ($ 2,899 million) growth of 3.5 percent YoY and 2.6 percent QoQ. Further, the analysts polled predicted that HCL Tech's CC revenue would grow at 3.7 percent QoQ..
“We are in the disruption phase of our lives, and the world has been dramatically reshaped and transformed. Technology has become all pervasive, in our homes, and livelihoods, and is the epicentre of our lives. Our HCL family has been a catalyst in this change and is helping global enterprises embrace digital transformation," company Chairperson Roshni Nadar Malhotra said.
In its earnings report, the company said the 7.6 percent quarterly growth in CC revenue was its highest in 12 years. Its earnings before interest, taxes, depreciation, and amortisation (EBITDA) for the latest quarter grew 8.3% QoQ to Rs 5,242 crore, while its earnings before interest and taxes (EBIT) stood at Rs 4.251 crore, a QoQ increase of 8.5%.
At the end of trading on the BSE on Friday, HCL closed in the green at Rs 1,337,55 per share, a 0.35% increase.
“We have delivered all round stellar performance this quarter ... Our Products & Platforms segment led the growth with 24.5 percent followed by Engineering and R&D Services with 8.3 percent and IT & Business Services with 4.7 percent, all in QoQ. Our future looks bright," Chief Executive Officer C Vijayakumar said.
The company's IT and Business services raked in a revenue of Rs 2,103 crore, while Engineering and R&D services earned Rs 473 crore. Products and Platforms accounted for a revenue of Rs 402 crore.
"This was clearly a quarter of record growth," Prateek Aggarwal, Chief Financial Officer, HCL Tech, said.
According to the report, HCL Tech, as of December 31, 2021, had an operating cash flow of $584 million and free cash flow of $521 million. The company reported gross cash at $ 2,666 million and net cash at $ 2,140 million.
Guidance for FY22
The company said it expects revenue to grow in the double digits in constant currency in the fourth quarter of the ongoing fiscal, FY22, and said its EBIT margin would be between 19 percent and 21 percent for the rest of the fiscal.
On the employment front
In the report, the company claimed it was named among the world’s best employers by Forbes for the second consecutive year. "HCL has also emerged the top ranked company globally in the professional services sector and one of the top-five India-headquartered multinationals across all sectors," the company said. 
The company said it has a full-time head count of 1,97,777, with a net addition of 10,143. Women employees constitute 27.7% of the company's strength and 163 nationalities are represented among its workforce, the company said. Of its total workforce, 1,84,430 are technical employees and 13.347 are sales and support staffers.
The company said it had plans to hire 20,000-22,000 this fiscal and has already 16,000 freshers by Q3. HCL Tech  reported a last 12 trailing months attrition of 19.8 percent, which is a 3.1 percent increase QoQ. The company underscored that this does not include involuntary attrition and digital process operations.
"We added more than 10,000 to our employee strength this quarter. I believe we continue to be in a vantage position to address sustained demand momentum," CEO  Vijayakumar added.
According to the report, HCL Tech has plans to create 12,000 new jobs in the United States in the next five years and expects to recruit more than 2,000 graduates over the next 36 months as part of its US early career and training programme, Rise at HCL.
HCL Tech has had a rough couple of days after a November 2021 email was reported in the media, in which the company asked its exiting employees to return their bonus. After uproar from employees union, the company announced on Thursday that it was withdrawing the contentious policy.