This post was originally published on this site
https://i-invdn-com.investing.com/news/LYNXNPEC0Q0MJ_M.jpg
Despite these strong results, HCL Tech followed in the footsteps of its rival Infosys (NS:INFY) by lowering its revenue outlook for FY24 from 6-8% to 5-6%, leading to some analyst concerns. Nevertheless, the company maintained its EBIT margin forecast at 18-19%.
Brokerages such as UBS, Kotak Institutional Equities, Motilal Oswal, Nuvama, and Choice Broking expressed a positive outlook on HCL Tech’s stock. However, JP Morgan rated the stock as ‘Underweight’.
A standout mega deal led to all-time high bookings for the company, which resulted in impressive cash conversion and margin expansion. The EBIT margin significantly exceeded forecasts. HCL Software’s recovery reached 16%, with an expected FY26E EPS of ₹76.5.
The company’s valuation was based on a 21x FY25E EPS multiple. It also made significant investments in digital capabilities. Management is guiding a 5-6% YoY cc growth for FY24E, with a focus on return on invested capital (ROIC) improvement.
However, due to slightly missed revenue growth, EPS estimates were lowered by 1.6% and 3.0%. Despite this adjustment, the overall performance of HCL Technologies in Q2FY24 demonstrates robust growth and resilience amidst market challenges.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.
