HCL Technologies Shares Decline After Q1 Profit Miss

Shares of HCL Technologies Ltd. declined after its first-quarter profit missed analysts' estimates.

Here's what the brokerages say about the company's Q1 results:

Citi

• Investors are worried about the guidance process and revenue
  visibility given the sharp deviation against expectations in the first quarter.

• “We expect the stock to be under pressure in the near term,” analyst Surendra Goyal said in the note.

• The weak results and the guidance will likely result in downgrades and a derating, Goyal says.

Jefferies

• The first quarter's performance is a reminder that IT firms can spring
  “unexpected negative surprises” when going through an
  “uncertain” demand phase, analysts Akshat Agarwal said in the note.

• “While the recent correction in the stock and 4.5% dividend
  yield limit downsides, upsides are capped as well,” Agarwal says
  in a note

Shares of the company fell 0.21% to Rs 1,108.20 apiece as of 10:19 a.m., compared to a 0.87% rise in the NSE Nifty 50. The scrip declined as much as 2.12%.

The total traded volume so far in the day stood at 13.2 times its 30-day average. The relative strength index was at 36.

Out of the 45 analysts tracking the company, 25 maintain a 'buy' rating, 15 recommend a 'hold', and five suggest a 'sell', according to Bloomberg data. The average 12-month consensus price target implies a potential upside of 7.3%.