HCL Technologies, the computer-services provider controlled by billionaire Shiv Nadar, said first-quarter profit gained 16 per cent, boosted by the local currency’s depreciation against the US dollar.
Net income rose to Rs 356 crore ($73 million) in the three months ended September 30 from Rs 308 crore a year earlier, the company said today in a release to the National Stock Exchange. Profit was in line with the Rs 340 crore median estimate in a Bloomberg survey of six analysts. Sales grew 39 per cent to Rs 2,370 crore.
Higher profit may help Noida-based HCL Technologies fund its planned £441 million purchase of Axon Group to expand consulting and software operations and compete against Tata Consultancy Services and Infosys Technologies. HCL Chief Executive Officer Vineet Nayar is seeking acquisitions to spur growth at a time when companies are forecast to scale back on technology-related spending.
Axon’s expertise in providing advice on business software from SAP AG “is what they require as they are much smaller than their peers”, Harit Shah, a Mumbai-based analyst at Angel Broking, said in a telephone interview.
HCL joined Infosys in benefiting from the weaker rupee, Asia’s second-worst performing currency this year, which helped increase the value of overseas sales. Bangalore-based Infosys last week reported second-quarter profit rose 30 per cent. HCL Technologies reported a foreign-exchange loss of Rs 97.4 crore, compared with a profit of Rs 14.5 crore a year earlier.
Profit in US dollars fell to $75.9 million in the three months ended September 30 from $77.4 million a year ago, the company said in a BSE release. Sales increased to $504.7 million from $429 million. The firm used a conversion rate of Rs 46.95 for every dollar in the quarter compared with Rs 39.84 a year earlier.
