“We have started this fiscal year on a very strong note and with our current momentum. While our margins this quarter were muted in line with our investment strategy, I am confident that our operating model will deliver margins within our guided range," said C Vijayakumar, president and CEO, HCL Tech.
In the first quarter, the Shiv Nadar-promoted firm saw 180 basis points fall in its operating margin to 17.1 per cent owing to its planned investments in products and platform space.
Among verticals, while financial services recorded tepid growth of 0.5 per cent; retail and telecommunication witnessed a marginal decline in growth sequentially. However, manufacturing grew more than 15 per cent, while technology and services grew 5 per cent sequentially.
“We expect revenues from our IBM IP deal to flow from second quarter onwards. With an annual run rate of $650 million, second quarter should see an addition of $125 million of revenue. This will supplement both our revenue and EBIT numbers,” said Prateek Aggarwal, chief Financial Officer, HCL Tech.
The company added 5,935 staff on net basis in Q1 to take its total head count to 143,900 at the end of the June quarter. Its attrition also fell 40 basis points to 17.3 per cent during this period.
“We have already announced 6-7 per cent hike in salary for our offshore employees and 1-2 per cent for our onsite staff. These are being rolled out from July,” said Apparao V V, chief human resources officer, HCL Tech. He said the company would add 12,000 fresh graduates this financial year.