Last updated: 23 Sep, 2020 | 10:56 am
HCL Technologies shares have soared to a 52-week high of ₹847.90 on BSE, after the company said on 21st, Sep. Monday that it will acquire Australian IT solutions firm DWS.
In the last financial year, the DWS group had reported overall revenues of AUD $167.90 million or about ~₹876 crore. This represents about 1.5% of HCL Tech’s revenues in FY20. Hence, we could expect this deal to add about 1.5-2% to its overall revenues. Thus, the deal augurs well for the company to expand its reach across geographies.
While the pandemic has hurt businesses in most other industries, the IT sector has remained relatively resilient. HCL Tech has also reported robust results in Q1FY21 due to cost avoidance measures, favourable currency movements, and large deal wins. Going forward, the company has provided a robust growth outlook. HCL Tech’s revenue growth for the current quarter is expected to exceed 3.5% QoQ in constant currency, significantly higher than the 1.5-2.5% average they projected just 2 months ago. The EBIT% for the current quarter is expected to be between 20.5% and 21.0%.
Consensus recommendation: Buy (based on views of 44 analysts from external institutions)