Valuation discount brings more comfort to HCL Technologies' investors

FY21 growth outperformance could be a challenge

A better-than-expected performance on revenue and margins in the December quarter as well as a guidance revision should help HCL Technologies report the best organic growth among large-cap peers in 2019-20 (FY20).

The company revised its revenue guidance in constant currency terms for the current financial year to 16.5-17 per cent, from 15-17 per cent indicated earlier. This will translate into an organic growth of 10-11 per cent — the highest among large-cap companies.

Margin guidance, too, has been increased to 19-19.5 per cent, from 18.5-19.5 per cent. The margin revision comes on the back of second consecutive quarter of