HCL Tech – Expects To Return 75% Of Capital To Shareholders From FY22‐26: Centrum Broking

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HCL Technologies Ltd. hosted its investor meet at New York on December 8 to discuss the company’s strategy, outlook and future growth.

HCL Tech maintained its FY23 constant currency revenue guidance of 13.5%-14.5%,  services guidance of 16%-17% and Ebit margin guidance of 18-19% for FY23, but expects to be at the lower end of the revenue guidance.

The company noted some slowdown in the near term driven by higher than expected furloughs in the banking, financial services and insurance (20.6% of revenues) and technology (15.1% of revenues) as well as reduced discretionary spends within pockets of telecom and tech.

Management also highlighted several levers which should continue to drive margin improvement. The company continues to return cash to shareholders and expects to maintain a payout ratio of 75% of net income between FY22-26E. 

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