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IT giant HLL Technologies will announce the results of the April-June quarter (Q1FY23) on Tuesday. Analysts expect the company to post 2.4-3 percent consecutive revenue growth on fixed currency (CC) terms. They say this is driven by IT services and engineering and R&D services (ERD).
On the other hand, the company’s Ebit margins are expected to decline by 108 bps to 16.9 percent over the last quarter due to higher assets and rising interest rates.
Of the six broker estimates set by Business Standard, three are expected to fall by 5-9 bps QoQ marg at Ebit margins.
Analysts expect the company to maintain its FY23 direction of 12-14 percent CCC revenue growth and EBIT margin of 18-20 percent.
Key Tracks
Comment on the area of interest; Perception of the low-performance services segment and product business; Supply-side challenges and the highly anticipated margin direction; Commentary on victories and compromises; And measures taken to control supply speed and supply-side challenges.
What Brokers Say:
SherkanBroker CC QoQ expects 2.6 percent revenue growth and 170 bps headline. The commodity trade is expected to remain flat, but growth in the service trade (IT and ERD) will be driven by an increase in previously failed agreements.
It is estimated that Ebit margins will decrease by 77 bps QoQ due to supply-side pressures, which is partly due to currency fluctuations. Net profit is expected to decrease from Q4FY22 to 3,238 kroner by 9.9 percent.
BNP Paribas mourning HCL Tech expects the second half of FY23 (H2FY23) to highlight the lack of interest. In addition, the company is expected to report a 2.9 percent steady decline in CC revenue and a 9 bps drop in Ebit margin to 17.9 percent.
Kotak Institutional Stock The broker’s average CCC gross revenue was 2.4 percent and 14.4 percent, respectively. While growth in services will continue to be strengthened by agreements, commodity revenues remain flat at $ 306 million. The total contract value is expected to exceed $ 2 billion to $ 1.7 billion. Ebit margins are expected to drop to 17.1 percent.
Philip CapitalAnalysts expect a 2.8 percent CC revenue growth to be driven by services (IT services and ERD), while P&P is expected to grow at a low level in the last quarter. Margins can be reduced by 50 bps, which can be offset by a reduction in rupee.
Motal OswalCC growth will be stronger due to IT services and P&P updates. The margin of services has remained stable since the last quarter, but its overall profitability is below regulation. Net profit is expected to fall 6.2 percent from Q4FY22.
IDBI CapitalIDBI Capital expects dollar revenue to grow 2.2 percent QoQ in part due to the 20 bps exchange rate effect. Expect the EBR margin to decrease by 108 bps QoQ.
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