HCLTech Q3 Results Review - Guidance Upgrade Dampens Enthusiasm; Motilal Oswal Reiterates 'Buy' On The Stock

HCLTech’s Q3 numbers and Q4 guidance were underwhelming. The implied organic growth rate for IT&BS in Q4 is approximately 0.6% in CC at the upper end of the guidance..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..Motilal Oswal Report.HCLTech Ltd. reported a revenue of $3.5 billion, up 3.8% QoQ and 4.1% YoY in constant currency, above our estimate of 3.7% QoQ CC growth (largely owing to one-month inorganic contribution from HPE CTG acquisition). Ebit margins came in at 19.5%, beating our estimate of 19.1%. New deal total contract value stood at $2.1 billion (down 5.5% QoQ) in Q3 FY25. For FY25, the revenue growth guidance has been upgraded to 4.5%-5.0% YoY cc (including a ~50 bp contribution from the HPE CTG acquisition, with organic growth at 4.0%-4.5%) from the earlier range of 3.5%-5.0%. For Q4 FY25, the implied organic growth for ITB&S is now in the range of -1.6% to +0.6% QoQ in cc, which is a downgrade, in our view. For 9MFY25, revenue/Ebit/PAT grew 6.6%/6.5%/11.7% compared to 9MFY24. We expect revenue/Ebit/PAT to grow by 7.3%/6.6%/7.3% YoY in Q4 FY25. We reiterate our Buy rating on HCLTech with a target price of Rs 2,400, implying a 21% potential upside..Click on the attachment to read the full report:.HCLTech Q3 Results: Net Profit Rises 8.4%, Meets Estimates.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 Q3 Results Review - Guidance Upgrade Dampens Enthusiasm; Motilal Oswal Reiterates 'Buy' On The Stock

Motilal Oswal expect HCLTech to deliver 18.2% Ebit margin in FY25, which should recover to 18.9% in FY26 as growth improves.

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HCLTech Q3 Results Review - Guidance Upgrade Dampens Enthusiasm; Motilal Oswal Reiterates 'Buy' On The Stock

Motilal Oswal expect HCLTech to deliver 18.2% Ebit margin in FY25, which should recover to 18.9% in FY26 as growth improves.

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