HCLTech Q2 Results Review — Strong Bookings Underpin Revenue Visibility Says Systematix Maintaining 'Hold'

Systematix remains cautiously optimistic about HCLTech's sustaining growth in H2, supported by a healthy deal pipeline and reasonable visibility on revenue, while monitoring profitability trends..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Systematix Report.HCLTech Ltd. delivered a strong Q2 FY26 performance, with revenue growing 2.4% QoQ in constant currency and 2.8% in USD, ahead of expectations. HCLTech raised the lower end of its FY26 services revenue growth guidance to 4–5% (from 3–5%), reflecting steady momentum in the services business. However, it maintained overall company-level revenue growth guidance at 3–5%, citing continued softness in the software segment driven by a decline in perpetual license revenues. Bookings came in strong at $2.6 billion, marking the first quarter above $2.5 billion without any mega deal, supported by balanced wins across verticals. The pipeline is at an alltime high, driven by advanced AI propositions, with GenAI now embedded in nearly every deal. While manufacturing remains affected by the auto sector weakness, other verticals like financial services, life sciences, and technology continue to perform well. We remain cautiously optimistic about sustaining growth in H2, supported by a healthy deal pipeline and reasonable visibility on revenue, while monitoring profitability trends. Management retained its FY26 Ebit margin guidance of 17–18%, factoring in wage hikes expected in H2. We maintain our USD revenue CAGR estimate of 5.9% over FY25–27E. While our FY26E/FY27E margin assumptions remain largely unchanged, we have raised our INR revenue and earnings estimates by 2.6%/2.3% and 2.1%/3.4%, respectively. We reiterate Hold with a revised target price of Rs 1,610 (Rs 1,592 earlier), valuing the company at a lower multiple of 22.5x FY27E EPS (23x earlier). .Key risks: Sudden exits at the leadership level, sustained pressure on client discretionary spending in FY26/FY27, non-encouraging outcomes of cost saving programs, etc..Click on the attachment to read the full report:.HCLTech Q2 Results Review — Motilal Oswal Maintains 'Buy' Post A Standout Quarter, Sees 20% Potential Upside.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

HCLTech Q2 Results Review — Strong Bookings Underpin Revenue Visibility Says Systematix Maintaining 'Hold'

Systematix reiterates 'Hold' rating on HCLTech, as the stock does not offer much upside from current market price.

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