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Another big announcement day has arrived for investors and on this one, they will have the entire weekend to chew things over. Today, HCL Technologies Q4 result is expected to be declared. Notably, HCL Tech has been one of the biggest Indian IT services providers for decades alongside the likes of Tata Consultancy Services, Infosys and Wipro. It is indeed a much-storied company. For today, investors should ideally look at the performance numbers for the fourth quarterly period, but over and above that, focus should be on the management commentary about how the company sees the demand scenario unfolding, and the deal wins. These two are amongst the most crucial aspects for future growth.
HCL Tech Q4 result: Investors should know what to keep an eye out for.(REUTERS) Read More: Alphabet Q1 results: Google parent company's revenue at $67.6 billion
Notably, TCS, Infosys and Wipro have reported very tough quarterly numbers even though the Tata company had some positives to show. HCL Tech Q4 results are expected to indicate a rough time too for its March quarter. Analysts have it that HCL Tech Q4 results will reflect, on a quarter-on-quarter (QoQ) basis, a decline in profit, revenue and margin. Whether it will span all three remains to be seen.
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However, on Dalal Street, HCL Technologies has been doing all right in the March quarter. HCL Tech share price beat both the Nifty IT index and Nifty 50. Notably, HCL Tech share price jumped 5% over the period, Nifty IT actually dropped 2% even as Nifty 50 was 3% in the green, LiveMint reports. After the result announcement, investors should expect the stock to react.
HCL Tech Q4 result: What to watch
Analysts have revealed the key metrics that investors should check thoroughly.
Brokerage Motilal Oswal Financial Services says it expects HCL Tech's Q4 revenue (rupee terms) may go up 7.9 per cent YoY. However, sequentially, it may well announce it flat for the quarter. The brokerage also said adjusted Profit after tax (PAT) increasing 6.8 per cent YoY. However, quarterly performance may actually show a drop of 2.3 per cent.
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On HCL Tech EBIT, the brokerage says the company may report an increase of 10.4 per cent YoY, but on a QoQ basis, it may drop 5.4 per cent. The brokerage also indicates a 120 bps QoQ fall in EBIT margin may be announced.
Brokerage Nirmal Bang sees the company’s revenue (rupee terms) jumping 7.6 per cent YoY. There may be a flat QoQ rise of 0.6 percent. As for PAT, the company may announce a growth of 6.2 per cent YoY. Quarterly performance is expected to drop 2.8 per cent.
Eye on future
As far as growth guidance is concerned, Motilal Oswal sees HCL Tech providing an initial FY25 revenue guidance of approximately 10 per cent. For EBIT margin it is expected to announce a stable-to-improving numbers.
Broker Nirmal Bang has reminded that HCL Tech had revised its CC growth guidance down from the earlier 6-8 per cent to 4-6 per cent for FY24 after a weak first half of FY24. The company had also lowered the upper end of the guidance to 5-5.5 per cent in Q3.
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As far as growth expectations for today go, Nirmal Bang sees the company announcing a revenue growth guidance (CC terms) of 4-7 per cent for FY25.
