By India Today Business DeskNoida-based IT services company HCL Technologies reported its financial results for the fourth quarter of FY23 on April 20.
The company’s shares rose over 2 per cent in early trade after it performed better than its larger rivals, TCS and Infosys. Its net profit during the quarter stood at Rs 3,983, marking an 11 per cent rise year-on-year, while revenue grew 18 per cent to Rs 26,606 crore.
Following the results, several brokerages have shared their views on HCL and its future outlook.
Brokerages on HCL Tech’s Q4 performance
Brokerage firm Macquarie has given an ‘outperform’ rating on HCL Tech, saying that the IT company’s growth is better than peers, going by guidance. The foreign brokerage has set a target price of Rs 1,580.
Morgan Stanley is another foreign brokerage that was bullish on HCL Tech, maintaining its ‘overweight’ rating. However, the brokerage has cut the target price of the stock to Rs 1,160 from Rs 1,200. It said HCL Tech has missed revenue growth and margins expectation in Q4 and that its guidance for FY24 revenue seems aggressive.
JP Morgan was among brokerages that maintained an ‘underweight’ rating for HCL Tech, cutting its target price to Rs 880. It cited the company’s weak revenue guidance for FY24 as a reason behind its view.
Jefferies said HCL Tech’s dollar revenues were in line with estimates and at the lower end of the company’s guidance range. While the brokerage said EBIT margins were down, it said the profit at Rs 3,980 crore was ahead of estimates. It maintained a ‘hold’ rating on HCL Tech, with a target price of Rs 1,125.
Brokerage firm Normura maintained a ‘neutral’ rating for HCL Tech, with a target price of Rs 1,100. The brokerage has lowered its FY24-25F EPS estimates for HCL Tech by 4 per cent for the financial year 2024-25, citing the possibility of lower revenue, margin and higher taxes.
Keven Bayer
Emanuel Schmitt
Kraig Prohaska