Most brokerages stay bullish on HCL Tech after robust Q4 show

Mumbai: Most brokerages have retained bullish view on HCL Technologies as the company’s March quarter consolidated net profit beat street expectations.

Shares of HCL Technologies ended up 1.3 per cent at Rs 518.30 on Friday.

The company reported a consolidated net profit of Rs 3,154 crore, up 22.8 per cent from year-ago level and, sequentially, higher by 3.8 per cent.


“HCLT delivered solid revenue growth of 0.8 per cent quarter-on-quarter and 13.5 per cent YoY. EBIT margin expanded, helped by absolute decline in costs on a sequential basis,” said Kotak Institutional while raising earnings estimates by 6-8 per cent and target price to Rs 570. “New bookings were strong. HCLT has impressed with execution, expansion of digital competencies and flow of large and mega deal wins,” said Kotak.

Jefferies revised target price higher to Rs 510 from Rs 480 and Morgan Stanley raised it to Rs 480 from Rs 460. Nomura raised target price to Rs 590 from Rs 570. However, some brokerages have also cut target prices after the result. Haitong Securities has cut target price to Rs 600 from Rs 660 as it has lowered its FY22 dollar revenue estimates by 13.9-17 per cent to factor in weak demand environment.

Macquarie has lowered estimates by 13-16 per cent and cut target price by 13 per cent to Rs 633. The brokerage said HCLT has entered FY21 with a strong order book though the near-term demand environment remains challenging.