Tech giant, HCL Technologies has announced a dividend reward ahead of the Diwali festival. The IT player is going to distribute a Rs 12 per share interim dividend for FY25. Accordingly, the company has a fixed record and payment date. The announcement was made during its Q2FY25 earnings where HCL Tech beats estimates across verticals. On Tuesday, October 15, HCL Tech extended its rally and continued to hit back-to-back new highs.
HCL Technologies Share Price:
In the early trade of Tuesday's session, HCL Tech touched a new 52-week high of Rs 1,882.00 apiece. The stock's price-to-equity ratio is at 42.66x, while the return on equity is at 32.43%.
YTD, the stock has surged by 26% on BSE.
HCL Technologies Dividend:
As per the regulatory filing, HCL Tech's board declared an Interim Dividend of Rs. 12 /- per equity share of Rs. 2/- each of the Company for the Financial Year 2024-25.
For the upcoming reward, HCL Tech fixed October 22, 2024, as the record date for the payment of the aforesaid interim dividend has been confirmed by the Board of Directors. The payment date of the said interim dividend shall be October 30, 2024.
On the record date, HCL Tech will identify eligible shareholders. October 22 will also be its ex-dividend date.
This will be the fourth dividend payout by HCL in 2024. Earlier, the company paid up to Rs 12 dividend per share for which it turned ex-dividend on July 23, 2024, while it turned ex-dividend on May 7 for a dividend payout of Rs 18 per share. The first dividend payout of 2024 was Rs 12 per share on January 19.
So far, in 2024, the total dividend was about Rs 42 dividend per share. If the upcoming dividend is taken into consideration, then the payout will be up to Rs 54 dividend per share.
Calculate HCL Tech Dividend Gains:
The easiest formula to know the dividend amount is - Dividend Per Share X Number of Shares = Total Cash Dividends.
So let's suppose, an investor holds 1,500 shares of HCL Tech, then the cash dividend amount would come to around Rs 18,000 at Rs 12 dividend per share (1,500 x 12).
Suppose the total dividend payout of Rs 54 per share. Then 1,500 shares would get dividends up to Rs 81,000 (1,500 Shares X Rs 54 Per Share).
HCL Technologies Earnings:
HCL beats estimates across all fronts, with Q2FY25 consolidated PAT coming at Rs 4,235 crore, registering a growth of 10.51% year-on-year. Consolidated revenue jumped by 8.21% year-on-year to Rs 28,862 crore, driven by key deal wins across verticals. HCL Tech also raised the lower end of its FY25 revenue guidance, which is a key boosting factor.
During the quarter, revenue was marginally up from Rs 28,057 crore revenue in Q1 of the current fiscal. In Q2FY24, the revenue of the company stood at Rs 26,672 crore. In constant currency, HCL Tech's Q2 revenue growth stood at 1.6% QoQ and 6.2% YoY. In dollar terms, HCL reported revenue of $3,445 million, rising by 2.4% QoQ & up 6.8% YoY.
BUY HCL Technologies:
After the Q2 results, CHOICE Broking said, that HCLT is well-positioned to capitalize on emerging opportunities in the GenAI sector with its AI Force digital suite, which enhances workflow optimization, operational flexibility, efficiency, and service quality for clients.
Further, the brokerage cited that management reports significant traction in AI and GenAI opportunities, as clients seek tangible benefits. They anticipate growth across all verticals (with green shoots visible in financial services) and geographies in Q3, with emerging markets driving growth in ROW geography. Furlough patterns in Q3 are expected to mirror last year's, and discretionary spending is projected to remain stable. As a result of higher-than-expected Q2 revenues, the company has raised its growth guidance for FY25E to 3.5-5% YoY in cc.
On the margins, CHOICE's note added, operating margins for the quarter rose to 18.6%, up 149bps sequentially and 14bps YoY due to improved share from the software business. Margins shall keep improving in Q3 as well due to seasonality in the software business. Management expects margins to remain range-bound in the 18-19% range for FY25E.
On the valuation, the brokerage's note said, "The company remains committed to achieving business growth in a sustainable and responsible manner. Their deal pipeline is robust, featuring opportunities in Data & AI, Digital Engineering, SAP migration, and efficiency-driven programs. We have introduced FY27E and expect Revenue/EBIT/PAT to grow at a CAGR of 10.5%/13.5%/13.7% respectively over FY24-FY27E. We upgrade our rating to BUY with a revised target price of INR2,105 implying a PE of 27x on Sep-FY27E EPS of INR78."
HCL Tech has a strong track record for dividends, bonus issues, and split.
Dividend: Since September 2000, the company delivered up to 91 dividends, as per Trendlyne data. On the current price, the company's dividend yield of 2.89%.
Stock Split: The stock has split once in the ratio of 4:2 in December 2000. The face value of Rs 4 was cut to Rs 2.
Bonus Issue: So far, the company has rewarded 3 bonuses. The bonus issue ratio was of 1:1 each in March 2007 and 2015, and last in December 2019.
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