HCL Tech Q4FY23 results this week: Revenue may grow in double digit on healthy deal pipeline; dividend awaited

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Key Points

According to analysts and brokerage firms, HCL Tech is expected to clock a profit rise in the range of 3.5-15.9 per cent on-year during the fourth quarter and net sales will register an increase by around 17.6 per cent...

IT company HCL Tech is expected to report a double-digit growth in revenue for the fourth quarter ended March 31, 2023, with estimates going as high as around 20.4 per cent, aided by ramp up of deals, well distributed across large and medium sized deals..

We expect the pipeline to remain healthy, the brokerage firm said.. While the IT firm is expected to guide for 4-6 per cent revenue growth for FY2024, Kotak Institutional Equities expects implied services growth guidance of 5-7 per cent..

We expect HCLs IT services business to report 1 per cent CC revenue growth for the quarter aided by ramp up of deals but at the same time weakness mentioned by the company in their recent analyst meet in Hi-Tech and Media & Entertainment verticals are likely to have some impact in Q4..

Kotak Institutional Equities said, We expect investor focus on: 1) revenue growth guidance for FY2024 and whether growth can be among industry leaders, 2) impact on discretionary businesses, i.e., products and ERS in the event of recession, 3) exposure to impacted verticals/clients and when revenue will bottom out in these segments, 4) outlook on revenue growth in Europe, 5) levers to increase margins to normalized band, 6) large-deal activity in the market, especially noting HCLTs higher dependence on large deals for growth, and 7) changes to hiring plans in FY2024 in a deteriorating macro environment..

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