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HCL Tech beats Wipro to be No 3 IT company

HCL Technologies' revenue rose 2.7% in constant currency to $2.06 billion in the June quarter compared to the preceding one, and 8.5% compared to the same period last year.

That's the second best performance among the top Indian IT companies. TCS' revenue rose sequentially by 4.1%, Infosys' by 2.3% and Wipro's by 0.1%. On a year-on-year basis, TCS grew by 9.3%, Infosys by 6% and Wipro by 2.4%.

HCL's net profit increased 3.4% to $356 million compared to the preceding quarter, and 5.7% compared to the same period last year.

HCL has overtaken Wipro to be the third-largest Indian IT firm. It had a narrow lead of about $30 million in the last quarter. But HCL has added only $16 million in incremental revenue in the June quarter, one of the lowest additions in the last five quarters.

Revenue from the banking and financial services vertical shrunk by 1.4% in the June quarter due to some of its clients insourcing work and reduction in outsourcing spends by a few clients. Manufacturing and retail, CPG revenue also fell.

The company has, however, maintained its guidance of 9.5% to 11.5% in constant currency for 2018-19.



HCL CEO C Vijayakumar said HCL signed 27 transformational deals in the June quarter, the highest in the history of the company. The momentum was led by telecom, financial services, retail, CPG and energy and utilities. He, however, didn't call out the total contract value of the deals signed.



Though the infrastructure management services segment had a muted growth, Vijayakumar said the second half of the year is looking up for the business as companies are modernising their infrastructure.



Recently, HCL won an over $500-million contract from its incumbent customer Nokia to transform and modernise its IT infrastructure and applications landscape. HCL said it will transition services from four incumbent vendors to establish an integrated IT services delivery and design framework and will implement a transformation road map.


Its newest growth engine, engineering services, grew by 3.1% sequentially and 24.2% on a year-on-year basis. The company added 4,040 employees to take the total headcount to 1.24 lakh employees.
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