INSUBCONTINENT EXCLUSIVE:
NEW DELHI: Shares of HCL Technologies declined over 4 per cent in morning trade on Friday, a day after the company posted 15.30 per cent
year-on-year (YoY) rise in profit at Rs 2,568 crore for the quarter ended March 31
Consolidated Ebitda jumped 18.50 per cent YoY to Rs 3,036 crore in Q4FY19
On the other hand, the figure slipped 1.40 per cent on QoQ basis
Global financial firm Morgan Stanley maintained its underweight view on HCL Tech with a target price of Rs 931, highlighting while revenue
growth was better during the last quarter, the margin was weaker
CLSA maintained buy rating on the stock with a target price of Rs 1,380, pointing to the fact that margins of the company slipped slightly
and 2019-20 guidance was sharply lower from one-off IBM transition costs
It also said while the company's digital segment accelerated, the products were impacted by seasonality
Phillip Capital maintained a neutral view on the stock but cut the target price to Rs 1,020 from Rs 1,040 earlier
"We maintain our neutral view on the stock as we expect relative underperformance in the near-to-medium term
Inexpensive valuations (13 times FY21) will, however, keep the downside limited," said the brokerage.
The company missed on the margins
The guidance for FY20 was significantly disappointing and also reflective of the possible challenges the company will face in integrating
We continue to believe that in absence of any major organic growth driver, HCLT will continue chasing inorganic growth, converting its
balance sheet into PL which will not find much favors with the investors, the brokerage added
Shares of HCl Tech traded 4.12 per cent down at Rs 1,085.45 on BSE around 9:45 am
