HCL Tech delivers despite wage hikes [DNA : Daily News & Analysis (India)]
(DNA : Daily News & Analysis (India) Via Acquire Media NewsEdge) HCL Technologies surprised the market by posting a 58.4% growth in its net profit to Rs1,496 crore over the previous year as against analyst expectations of Rs1,453 crore. Because of a stable currency the company posted a much higher growth in dollar terms at 4% for revenues and 7.1% at net profit.
What is creditable is that the company's operating margins did not suffer despite a wage hike given during the quarter. During the quarter, the company added 1,136 employees. But more importantly utilisation was high at 84.1%.
Just a day before the result HCL Technologies announced a tie-up with Computer Science Corp to modernise the applications of enterprise clients and transition them to the cloud. It's still early days and the benefits of the tie-up will take time to be reflected on HCL Tech's financials. However, the deal signals is that HCL Tech is willing to tie up with a rival firm rather than compete with it or acquire it.
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