HCLTech Q3 profit rises 5.5% to ₹4,591 cr; declares special dividend

HCLTech has reported a 5.1% year-on-year rise in its net revenue to ₹29,890 crore for the October-December 2024 quarter, while its net income surged 5.5% on a YoY basis to ₹4,591 crore, according to the latest exchange filing by the IT services major.

The Noida-based IT major's constant currency revenue grew 4.1%, while USD revenue increased 3.5% YoY. Of the various segments, digital revenue grew the highest at 6.3%, while software revenue was recorded at 2.1% YoY in constant currency.

In profitability and return metrics, HCLTech saw EBIT growing 3.7% to ₹5,821 crore. The company declared a dividend of ₹18/- per share, including a special dividend of ₹6/- per share to celebrate 25 years of HCLTech’s public listing. This represents the 88th consecutive quarter of dividend pay-out.

In terms of bookings, HCLTech saw the total commercial value of new deal wins at $2.1 billion.

The total people count at HCLTech stood at 220,755 as of December 31, 2024, with a net addition of 2,134 during the said quarter. Of this, the company added 2,014 freshers. The company's attrition based on LTM stood at 13.2%, up from 12.8% in Q3 of last year.

In its FY25 guidance, HCLTech expects revenue growth between 4.5%-5.0% YoY in constant currency, while the services revenue growth is expected to be between 4.5%-5.0% YoY in CC. The company expects EBIT margin to be between 18%–19%.

Roshni Nadar Malhotra, chairperson of HCLTech, says HCLTech is well positioned as AI-led transformation brings new growth opportunities. "We continue to deliver industry-leading performance with governance and sustainability at the core."

C Vijayakumar, CEO & MD, has termed the Q3 FY25 performance "another quarter of solid growth", as the company saw 3.8% QoQ growth in constant currency and EBIT at 19.5%. "This growth is powered by broad-based performance across business lines as our clients across verticals and geos reaffirm their confidence in our Digital and AI offerings. Our new deal bookings were healthy during the quarter at $2.1B with wins across services and software. We are positioning ourselves for a transformative future, with AI empowering businesses and employees."

CFO Shiv Walia says HCLTech's "razor-sharp focus" on achieving topline growth with healthy margins is reflected in its "highest ever EBIT of ₹5,821 crore". "Q3 EBIT margins came in at 19.5% (up 93 bps QoQ). LTM Return on Invested Capital (ROIC) continues its growth trajectory and stands at 36.6% for the company (up 385 bps YoY), and at 44.7% for Services (up 455 bps YoY). Cash conversion (on LTM basis) continues to outpace our 5-year FCF/NI average of 126% with FCF/NI of 134% this quarter."

He says the Q3 FY25 results have strengthened HCLTech's balance sheet, helping it end the quarter with the highest-ever cash balance of ₹27,707 crore.

Just last week, Tata Consultancy Services (TCS) also announced its Q3FY25 results, reporting a consolidated net profit of ₹12,380 crore in Q3 FY25, a growth of 12% as compared to ₹11,058 crore in the year-ago period. The company's revenue rose 5.6% to ₹63,973 crore in Q3 FY25, driven by consumer business group (1.1%), energy, resources and utilities (3.4%), and regional markets (40.9%).