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NEW DELHI: Shares of HCL Technologies were marginally lower on Tuesday ahead of its December quarter results scheduled for later in the day.
The IT major is likely to report 2.5-4 per cent YoY rise in constant currency (CC) revenue and expansion in margins to the tune of 30-70 basis points sequentially.
The management is expected to maintain revenue growth guidance of 9.5-11.5 per cent for FY19.
At 10.35 am, the scrip was trading 0.66 per cent lower at Rs 969.50.
Brokerage Edelweiss Securities expects HCL Tech to log 2.6 per cent CC revenue growth due to seasonal strength in its product business.
“Revenue growth will be hampered by 50 bps on account of cross currency headwinds, bringing down the dollar growth to 2.1 per cent.
Margin is expected to expand 70 bps QoQ on account of benefit of rupee depreciation, strong growth in product business and other operational efficiencies.
Growth rates in product business, commentary on ERD business, traction in IMS and update on products acquisition from IBM are key monitorables,” the brokerage said.
Jefferies expects the IT major to report 4 per cent QoQ constant currency growth led by contribution from large deal wins and favorable seasonality in mode and services including IP partnerships.
“EBIT margin is likely to improve 30 bps QoQ but remain within guided range of 19.5-20.5 per cent.
We do not expect any change to FY19E growth guidance of 9.5-11.5 per cent either.
Additional commentary on recent $1.8 billion acquisition of IBM products (see report) will be key,” it said.
Centrum Broking expects HCL Tech to report Ebitda margins of 23.8 per cent for the quarter, up 30 bps QoQ.
Third quarter is seasonally strong for the IBM IP business, which could aid overall margins for HCL Technologies, it said.
