HCL Tech: Stock Gains Ahead Of Q1, 2nd Interim Dividend; Will The IT Player Report Better Earnings Than Peers?

HCL Technologies, an IT giant backed by Shiv Nadar, will report its first quarterly results for the financial year 2024-25. Ahead of Q1, HCL Tech's share price traded on a bullish note. In the early trade, the stock rallied by at least 1.3% with an intraday high of Rs 1,532 apiece on BSE.

At the time of writing, HCL Tech traded at Rs 1531.25 apiece, near the day's high, up by 1.27% with a market cap of Rs 4,15,529.97 crore. The stock's 52-week high and low is at Rs 1,696.50 apiece and Rs 1,087.75 apiece respectively.

On July 12, HCL Tech's board of directors will meet to consider the unaudited Financial Results of the Company for the quarter ending June 30, 2024. Also, the company's board will consider the payment of a second interim dividend for FY25.

Earlier, for FY25, HCL Tech paid its first interim dividend of 900% amounting to Rs 18 per share for which it turned ex-dividend on May 7, 2025. In FY24, the company paid dividends of 2,600% worth Rs 52 per share.

At the current market price, HCL Tech has a dividend yield of 3.42%.

In Q1FY25, Axis Securities expects HCL Tech to report revenue de-growth of 1.6% QoQ in rupee terms and an operating margin contraction of 55bps. Key factors to watch out for are a) Deal TCV/deal pipeline, b) Pricing scenario, and c) Outlook on growth, operating margins, and P&P business."

Axis Securities expects revenue of Rs 28,623 crore for HCL Tech in Q1FY25, which is likely to record growth of 0.6% QoQ and 7.6% YoY, aided by the ramp-up in the previous deals and stronger IT Product & Platform business. While the brokerage expects a contraction of 39 bps in EBIT margins to 19.3% sequentially, due to higher onsite expenses. However, the brokerage expects normal deal wins in the quarter. PAT is factored at Rs 4,290 crore, which is likely to be down by 1.4% QoQ but a growth of 7.7% YoY.

Further, BOB Capital Markets expects HCL revenue growth guidance for FY25 at 3-5% in CC terms to be maintained and so too the EBIT margin guidance of 18-19%.

However, BOBCaps believes this Q1 could be likely the worst QoQ growth numbers among Tier-1 peers - a 2% decline. Flagged off during 4QFY24 largely due to offshoring of a large client and productivity pass-through for others. Further, the brokerage expects HCL Tech's TCV to come in at US$ 2bn-2.5bn (entirely net new).

But BOBCaps believes that HCL's margin is a key monitorable, especially in services as this has been quite volatile in the past and has in certain quarters surprised the
downside.

In Q4FY24, HCL Tech posted revenue of Rs 28,499 Crore, up 0.2% QoQ & up 7.1% YoY. While constant currency revenue was up 0.3% QoQ & up 6.0% YoY. Net income stood at Rs 3,986 Crore (14.0% of revenue), down 8.4% QoQ & up 0.1% YoY.

FY24 revenue was at Rs 109,913 Crore, up 8.3%, while constant currency Revenue was up 5.0%. USD Revenue came in at US$ 13,270 Mn, up 5.4%. Overall, in FY24, Net Income came in at Rs 15,702 Crore (14.3% of revenue), up 5.7%.

For FY25, in the previous quarter announcement, HCL Tech estimated CC revenue growth between 3% to -5%. While services CC revenue growth expected to be between 3.0% - 5.0% YoY. Also, EBIT margin expected to be between 18.0% - 19.0%. It will be keenly watched if HCL Tech will raise or trim its guidance on July 12.