HCL Tech to chase contracts up for renewal

Earlier today,HCL Technologies posted 78.1 per cent jump in net profit at Rs 884.8 crore.

Written by Agencies | New Delhi | Published:October 17, 2012 6:36 pm

HCL Technologies today said it will go “hunting” to grab a major chunk of the USD 40 billion worth of contracts coming up for renewal in the ongoing October-December quarter.

“Ours is a guerrilla strategy. Till now,we were in the execution phase of contracts that we won in last 12 months. In the October to December quarter,our hunters will go after the USD 40 billion worth of contracts coming up for renewal,according to TPI,” HCL Technologies CEO Vineet Nayar said.

At least USD 8 billion worth of contracts will change hands to new vendors,which in itself is a huge number,he added.

“We believe the next 60 days are going to be very crucial for the Indian IT industry,” he said.

Earlier today,HCL Technologies posted 78.1 per cent jump in net profit at Rs 884.8 crore for the first quarter ended September 30,while its revenues were up 31 per cent at Rs 6,091 crore in the reported quarter.

Nayar said the company was till now executing deals worth USD 2.5 billion that it had won in the October-December quarter of 2011.

He added that HCL Technologies won “51 per cent of the deals it chased in the July-September quarter”.

The HCL Technologies CEO was of the view that IT budgets of companies are expected to be flat or negative.

“Directionally everybody is clear that the IT budgets are not going up. Its either flat or negative. Also,discretionary spends would depend on performance,” he added.

HCL Technologies’ growth has come on the back of deal wins and growth across developed markets like the US and Europe,which grew 13.5 per cent and 16.4 per cent,respectively.

“There is a significant opportunity in developed markets like US and Europe because of vendor churn and therefore,we moved our efforts away from Rest of the World (RoW) into these geograophies. The result of that has been extremely good,”

Nayar said.

He added that it does not expect any significant impact of the US elections as it is hiring people across these geographies as well.

For the quarter ended September 30,2012,the US contributed 55.8 per cent of the revenues,while Europe and Asia Pacific contributed 26.6 per cent and 17.5 per cent,

respectively.

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