MUMBAI HCL Technologies Ltd (HCLT.NS), India's fourth-largest IT services exporter, reported on Thursday quarterly growth in its dollar-denominated revenue that missed analyst estimates, sending the company's shares down by as much as 2.5 percent.
For most IT services companies, analysts and investors track the dollar sales numbers as clients oversees get billed in that currency. For the quarter ended June, HCL posted a 3.4 percent rise from March to $1.4 billion, below industry leader Tata Consultancy Services' (TCS) (TCS.NS) 5.5 percent increase.
"We were expecting it to grow about 4 percent. In the past HCL has been able to keep at about the same dollar revenue growth as TCS," said Ankita Somani, analyst at brokerage MSFL Research.
HCL is part of a $108 billion Indian outsourcing sector that generate the lion's part of their sales by providing services like IT network installation and development of software applications to Western clients.
Revenue from the Americas, HCL's largest market, saw a rise of 12 percent in the quarter, while sales in Europe, where the company's clients include a British government agency and a Swiss pharmaceutical company, rose 25 percent.
Consolidated net profit in its fiscal fourth-quarter ended June 30 rose 54 percent to 18.34 billion rupees ($305.4 million) from 11.93 billion rupees a year earlier, the company said.
Analysts, on average, had expected the company to report a net profit of 16.15 billion rupees.
HCL shares closed 2.7 percent lower at 1,555.10 rupees.
Research firm Gartner says global IT spending is expected to total $3.7 trillion in 2014, up 2.1 percent from a year earlier.
($1 = 60.0600 rupees)
(Reporting by Devidutta Tripathy and Nivedita Bhattacharjee; Editing by Ryan Woo)
Trending On Reuters
Indian consumers offer a glimmer of hope for the Indian economy, which grew at a slower-than-expected annual rate of 7 percent in the June quarter. Full Article