Shares of HCL Technologies rallied over 7% in early trade on Wednesday, in sync with broader market, after IT heavyweight reported highest revenue growth in the large-cap IT services space for three consecutive years. The sentiment was further boosted as the Noida-based company’s FY26 revenue guidance was better than Street estimates. The management, however, believes that tariff and deglobalisation are likely to impact growth in IT Services stemming from budget cuts and subdued discretionary spending amid ongoing macro challenges.

Extending gains for the seventh straight session, HCL Technologies shares rose as much as 7.4% to ₹1,589.95 in the first hour of trade so far, while its market capitalisation climbed to ₹4.26 lakh crore. Early today, the IT heavyweight opened 4.8% higher at ₹1,550.10, while it has risen over 15% in seven sessions.

HCL Tech share price touched its 52-week low of ₹1,235 on June 4, 2024, while the counter hit its 52-week high level of ₹2,011 on January 13, 2025. The stock has lost over 17% in the calendar year 2025, while it delivered a positive return of 6% in the last one year. The IT major saw its shares falling by 15% in six months, while it lost nearly 2% in a month.

Should you buy, hold, or sell HCL Tech shares post Q4?

While most brokerages have maintained a positive stance on HCL Tech shares, but cut target prices, citing uncertain environment coupled with weak discretionary spending. HCL has given a revenue guidance of 2-5% for FY26, which was mostly higher than analysts estimate.  

Emkay Global has retained ‘ADD’ rating on the stock, while cutting its target price by 6% to ₹1,600, at 22x Mar-27E earnings per share (EPS) as compared to 23x earlier. The brokerage in its report said that the earnings performance was slightly below its estimate as revenue and EBITM (earnings before interest, taxes and corporate overhead or management fees) declined sequentially due to Software business seasonality. However, deal pipeline was near an all-time high amid strong bookings in Q4.

The lower end of the guidance assumes further deterioration in demand while the upper end assumes a stable demand environment and certain large deal closures in Q1, it said in a report.

Meanwhile, Nuvama has upgraded the stock to 'BUY' with price target of ₹1,700, saying that Q4 FY25 results were in line with expectations. “HCL's FY26 revenue growth guidance (2%–5% CC YoY) was slightly better than expectations, as well as Infosys (0%–3%), with a reasonable required CQGR (0.3%–1.5%),” it said in a note.

The brokerage in its report said that HCL has reported highest revenue growth in the large-cap IT Services space for three consecutive years. “Given its guidance, it shall be able to repeat the feat in FY26 too, on our numbers. All along its solid cashflow translates to a high dividend yield (4.2%) at current valuations. All this has led to a sharp rerating of the stock over the last two years, which we believe, should sustain,” it said.

For the fourth quarter ended March 31, 2025, HCL Tech profit remained flat at ₹3,986 crore, up just 0.1% year-on-year (YoY), while its INR revenue surged 7.1% to ₹28,499 crore. The constant currency revenue increased 6% YoY. It also declared interim dividend of ₹18 per equity share for the financial year 2025-26.

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