HCL’s profit up 12%, prepares for struggle

HCL’s profit up 12%, prepares for struggle
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First Published: Fri, Jan 23 2009. 10 49 PM IST

 Shrinking market: HCL chief executive officer Vineet Nayar. Madhu Kapparath / Mint
Shrinking market: HCL chief executive officer Vineet Nayar. Madhu Kapparath / Mint
Updated: Fri, Jan 23 2009. 10 49 PM IST
New Delhi: India’s fifth largest software exporter, HCL Technologies Ltd’s December quarter profit rose 12% on record deals, but officials said the next few quarters would see tougher competition for a shrinking pie of deals.
Shrinking market: HCL chief executive officer Vineet Nayar. Madhu Kapparath / Mint
HCL took $1 billion (Rs4,920 crore) in contracts in the three months to December, chief executive officer Vineet Nayar said. “But I don’t think we’ll win as many as last quarter,” he said about the prospects of the quarter to March.
India’s export-oriented software firms have warned of uncertain prospects for four to six quarters. Bellwethers Tata Consultancy Services Ltd and Infosys Technologies Ltd have spoken of tough and challenging times ahead, with the latter trimming its annual profit forecast. HCL counts as its clients Deutsche Bank AG, Microsoft Corp., Xerox Corp. and Cisco Systems Inc.
In the three months to December, the second quarter of HCL’s fiscal year starting July, net income rose to Rs373 crore from Rs333 crore a year ago under US accounting standards. Revenue rose 37.1% to Rs2,491 crore during the the period.
The numbers include financials of British software firm Axon Group Plc., which HCL acquired in December.
Ahead of the results, shares of HCL, which has a market capitalization of nearly Rs75 billion, closed 4.9% down at Rs107 on the Bombay Stock Exchange.
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First Published: Fri, Jan 23 2009. 10 49 PM IST