HCLTech Ltd. shares are in focus heading into trade on Wednesday after the IT major reported a rather disappointing set of numbers for the fourth quarter of the financial year ending March 2026.
The IT firm reported a 10% surge on net profit, but revenue remained muted on low discretionary spend and a difficult demand environment. It was an all-round miss, largely due to client-specific factors and project pullbacks.
All of this led to a FY27 guidance that was underwhelming, according to brokerages, with the company expected to be hit by client-specific factors and AI-led deflation. This is not helped by an uncertain macro scenario.
In light of HCLTech's Q4 earnings, brokerages reined in on the IT major, cutting target price across the board.
Brokerages On HCLTech
Kotak Securities on HCLTech
- Maintain Reduce; Cut TP to Rs 1370 from Rs 1425
- Disappoints on all counts; guidance reflects a tougher reality
- All-round miss; client-specific factors and project pull-backs
- FY2027 revenue guidance—hit by client-specific factors, AI deflation
Morgan Stanely on HCLTech
- Maintain Equal-weight; Cut TP to Rs 1410 from Rs 1760
- P/E Premium to Normalize vs. Peers Given Growth Rates Converging
- Macro remains volatile, which could spring unexpected client-specific issues
- AI-led deflation in existing core business to affect growth rates while new services take time to bloom
- Incremental currency benefits to be reinvested
Citi on HCLTech
- Maintain Neutral; Cut TP to Rs 1385 from Rs 1400
- Weak Q4FY26 and FY27 revenue guidance
- Weak guidance will weigh on the stock in the near term
- Industry view remains bearish
- HCL continues to be relatively better placed medium term in the peer group context
Investec on HCL Tech
- Maintain Hold; Cut TP to Rs 1350 from Rs 1680
- A weak quarter and guidance
- Negative surprise was led by client specific issues across multiple segments
- These revenue headwinds are likely to continue into Q1FY27
- This leads to a weaker-than-anticipated revenue growth guidance of 1-4% vs est. 3-6%
ALSO READ: HCLTech Q4 Results: Profit Rises 10% To Rs 4,488 Crore, Revenue Flat On Low Discretionary Spends
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