HCL’s shares fell by 6.4% on the National Stock Exchange after the results were announced. The firm’s revenue was flat in rupee terms, compared with a growth of 2.9% reported by TCS.

And while TCS and Infosys reported an increase in operating margins, HCL’s margin fell last quarter, leading to an 8.1% drop in earnings before interest and taxes (Ebit). In comparison, TCS’ Ebit rose by 7%.

Graphic: Yogesh Kumar / Mint

Also, to be fair to HCL, its performance is coming off a relatively high base. Its growth was at the top end of the range for top-tier IT firms in the September quarter and was far ahead of the rest in the June quarter.

There is evidence of this in the year-on-year (y-o-y) growth rates of the company. Its revenue growth on a y-o-y basis was 22.8% last quarter. TCS’ revenue growth was just 5.1%.

Among the positives for HCL last quarter was the 4.6% growth of the enterprise application services business in constant currency terms. In the September quarter, revenue from this segment had dropped by 5%, which had raised concerns about the integration of the Axon Group Plc business it acquired in 2008. The return to growth in the segment is, therefore, heartening.

Besides, while cash flow generation was weak at $10 million (Rs46 crore today) in the September quarter, it was rather strong at $117 million in the December quarter. HCL’s shares have outperformed its peers since its strong June quarter results, and its returns have continued to be higher than the sector, although the degree of outperformance has narrowed.

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