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Last Updated on: 07 July, 2024|Author: Getaka | Social: X Twitter Profile
Stock Ticker - BSE: 532281 | NSE: HCLTECH

Fundamental Analysis of HCL Technologies Ltd

About the Company - HCL Technologies Ltd

HCL Technologies Ltd. is a Public Limited Listed company incorporated on 12/11/1991 and has its registered office in the State of Delhi, India. Company’s Corporate Identification Number(CIN) is L74140DL1991PLC046369 and registration number is 046369. Currently Company is involved in the business activities of Computer programming, consultancy and related activities. Company’s Total Operating Revenue is Rs. 40638.00 Cr. and Equity Capital is Rs. 543.00 Cr. for the Year ended 31/03/2022.
INDUSTRYADDRESSCONTACT
IT Consulting & Software806, Siddharth, 96, Nehru Place, New Delhi Delhi 110019investors@hcl.com
http://www.hcltech.com
Management
NamePosition Held
Ms. Roshni Nadar MalhotraNon Exe. Non Ind Chairperson
Mr. Shiv NadarChairman Emeritus
Mr. C VijayakumarManaging Director & CEO
Mr. Shikhar MalhotraNon Exe.Non Ind.Director
Ms. Robin Ann AbramsInd. Non-Executive Director
Dr. Sosale Shankara SastryInd. Non-Executive Director
Mr. Subramanian MadhavanInd. Non-Executive Director
Mr. Thomas SieberInd. Non-Executive Director
Ms. Nishi VasudevaInd. Non-Executive Director
Mr. Deepak KapoorInd. Non-Executive Director
Dr. Mohan ChellappaInd. Non-Executive Director
Mr. Simon John EnglandInd. Non-Executive Director
Ms. Vanitha NarayananInd. Non-Executive Director
Mr. R SrinivasanInd. Non-Executive Director

Basic Stock Data of HCL Technologies Ltd

Last Updated: July 6, 2024, 12:04 pm

Market Cap 4,12,314 Cr.
Current Price 1,519
High / Low1,697/1,087
Stock P/E26.3
Book Value 252
Dividend Yield3.42 %
ROCE29.8 %
ROE23.5 %
Face Value 2.00
PEG Ratio3.62

Competitors of HCL Technologies Ltd

Stock NameMarket CapCurrent PriceHigh / LowStock P/EBook ValueDividend YieldROCEROEFace Value
Ceinsys Tech Ltd 855 Cr. 523699/18224.4 1430.38 %21.8 %16.2 % 10.0
Melstar Information Technologies Ltd 6.78 Cr. 4.756.30/1.85 2.770.00 %177 %% 10.0
Palred Technologies Ltd 131 Cr. 107230/99.0 46.00.00 %1.05 %5.89 % 10.0
Tech Mahindra Ltd 1,42,903 Cr. 1,4611,498/1,08260.6 2732.74 %11.9 %8.63 % 5.00
AAA Technologies Ltd 132 Cr. 103147/51.141.2 21.80.48 %16.1 %12.0 % 10.0
Industry Average34,302.68 Cr727.2469.06116.480.63%19.69%19.22%6.88

HCL Technologies Ltd Quarterly Results

MonthSep 2020Dec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023
Sales18,59419,30219,64120,06820,65522,33122,59723,46424,68626,70026,60626,29626,672
Expenses13,47613,67815,09215,00615,63316,93817,54518,48919,26120,33520,74320,93120,743
Operating Profit5,1185,6244,5495,0625,0225,3935,0524,9755,4256,3655,8635,3655,929
OPM %28%29%23%25%24%24%22%21%22%24%22%20%22%
Other Income199189244255240255317409236260453344365
Interest801471598983826564791169486156
Depreciation1,0921,1871,2671,1281,0781,1369849839981,1371,0279271,010
Profit before tax4,1454,4793,3674,1004,1014,4304,3204,3374,5845,3725,1954,6965,128
Tax %24%11%67%22%20%22%17%24%24%24%23%25%25%
Net Profit3,1463,9771,1113,2133,2633,4483,5993,2813,4874,0963,9813,5313,833
EPS in Rs11.5814.634.0611.8112.0112.6813.2412.1012.8615.0914.6813.0214.12

HCL Technologies Ltd Quarterly Chart

HCL Technologies Ltd Profit & Loss

MonthJun 2012Jun 2013Jun 2014Jun 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023TTM
Sales20,83125,58132,14436,70131,13647,56850,56960,42770,67675,37985,651101,456106,274
Expenses17,13519,90124,10828,21524,48237,17839,32346,50153,36055,33165,12278,82882,752
Operating Profit3,6955,6808,0358,4866,65410,39011,24613,92617,31620,04820,52922,62823,522
OPM %18%22%25%23%21%22%22%23%24%27%24%22%22%
Other Income2063326771,1268711,0691,2309435899271,0671,3581,422
Interest14310611491748969174505511319353452
Depreciation5496376814044108281,3832,0733,4204,6114,3264,1454,101
Profit before tax3,2105,2707,9179,1177,04110,54211,02412,62213,98015,85316,95119,48820,391
Tax %24%23%18%20%20%18%21%20%21%30%20%24%
Net Profit2,4234,0406,5287,3425,6028,6068,72210,12011,05711,16913,52314,84515,441
EPS in Rs8.7414.4923.2526.0219.8630.1631.3237.3140.7541.0749.7454.7356.91
Dividend Payout %34%21%11%58%40%40%19%11%25%24%84%88%

HCL Technologies Ltd Profit & Loss Yearly Chart

YoY Net Profit Growth

Year2016-20172017-20182018-20192019-20202020-20212021-20222022-2023
YoY Net Profit Growth (%)53.62%1.35%16.03%9.26%1.01%21.08%9.78%
Change in YoY Net Profit Growth (%)0.00%-52.28%14.68%-6.77%-8.25%20.06%-11.30%

HCL Technologies Ltd Growth

Compounded Sales Growth
10 Years:16%
5 Years:13%
3 Years:13%
TTM:8%
Compounded Profit Growth
10 Years:15%
5 Years:9%
3 Years:13%
TTM:7%
Stock Price CAGR
10 Years:15%
5 Years:19%
3 Years:14%
1 Year:29%
Return on Equity
10 Years:24%
5 Years:22%
3 Years:23%
Last Year:23%

Last Updated: April 25, 2024, 2:40 pm

HCL Technologies Ltd Balance Sheet

MonthJun 2012Jun 2013Jun 2014Jun 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Sep 2023
Equity Capital139139140281282285278271543543543543543
Reserves9,69913,02519,41023,94327,10932,66436,10841,09550,72459,37061,37164,86265,140
Borrowings2,1791,0441,0186481,0905825574,1957,9866,8646,3434,7945,268
Other Liabilities6,3208,1919,41210,37210,85912,23111,04612,78823,56619,27020,66423,05122,628
Total Liabilities18,33822,39929,98035,24539,34145,76247,98958,34982,81986,04788,92193,25093,579
Fixed Assets6,4536,7537,4448,2759,71615,23518,75322,88837,49037,14535,07734,61935,834
CWIP5784945315526114483202354003121294056
Investments6737136628696981,3062,6602,3057,0666,8626,3515,4955,583
Other Assets10,63314,44021,34325,54828,31528,77326,25632,92137,86341,72847,36453,09652,106
Total Assets18,33822,39929,98035,24539,34145,76247,98958,34982,81986,04788,92193,25093,579

HCL Technologies Ltd Reserves and Borrowings Chart

HCL Technologies Ltd Cash Flow

MonthJun 2012Jun 2013Jun 2014Jun 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Cash from Operating Activity 2,4184,4926,4575,5393,8238,9958,3288,97113,35919,61816,90018,009
Cash from Investing Activity -1,026-2,361-4,842-2,088-2,208-3,890-2,236-3,256-12,332-5,6651,597-3,573
Cash from Financing Activity -1,239-2,086-1,308-3,140-2,237-4,517-5,714-1,471-3,168-11,192-14,508-15,881
Net Cash Flow15344307311-6235883784,244-2,1412,7613,989-1,445

HCL Technologies Ltd Free Cash Flow

MonthJun 2012Jun 2013Jun 2014Jun 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023
Free Cash Flow1.004.007.00-640.005.00-572.00-546.009.0010.0014.0014.0018.00

Free Cash Flow = Income Generated from Operational Activities - Borrowings - Capital Work in Progress (CWIP)

Consistent positive free cash flow is crucial for businesses as it indicates their ability to generate cash from their core operations. It provides financial flexibility, allowing companies to invest in growth opportunities, pay dividends to shareholders, reduce debt, and weather economic downturns more effectively.

HCL Technologies Ltd Free Cash Flow Chart

HCL Technologies Ltd Financial Efficiency Indicators

MonthJun 2013Jun 2014Jun 2015Mar 2016Mar 2017Mar 2018Mar 2019Mar 2020Mar 2021Mar 2022Mar 2023Mar 2024
Debtor Days646565916470717385889265
Inventory Days
Days Payable
Cash Conversion Cycle646565916470717385889265
Working Capital Days151029643859492752484759
ROCE %41%45%40%28%34%31%31%27%26%25%28%

HCL Technologies Ltd Financial Efficiency Indicators Chart

HCL Technologies Ltd Share Holding Pattern

MonthDec 2020Mar 2021Jun 2021Sep 2021Dec 2021Mar 2022Jun 2022Sep 2022Dec 2022Mar 2023Jun 2023Sep 2023
Promoters60.33%60.33%60.33%60.33%60.33%60.72%60.72%60.72%60.72%60.82%60.82%60.82%
FIIs24.92%24.14%23.22%22.30%20.43%18.97%17.91%17.17%18.29%18.92%18.98%18.80%
DIIs10.25%10.54%11.34%12.47%13.74%14.68%15.54%16.52%15.85%15.28%15.33%15.62%
Government0.04%0.02%0.02%0.02%0.02%0.02%0.02%0.02%0.02%0.02%0.02%0.02%
Public4.46%4.97%5.09%4.88%5.28%5.38%5.59%5.34%4.89%4.74%4.63%4.54%
Others0.00%0.00%0.00%0.00%0.20%0.23%0.23%0.23%0.23%0.23%0.23%0.21%
No. of Shareholders3,61,3525,17,8476,35,9496,53,5927,78,1129,08,0559,95,79610,89,3179,91,5489,40,0799,09,3598,79,120

HCL Technologies Ltd Shareholding Pattern Chart

No. of HCL Technologies Ltd Shareholders

HCL Technologies Ltd Mutual Fund Holdings

Fund NameNo of SharesAUM (%)Amount Invested (Cr)Previous Number of SharesPrevious DatePercentage Change
SBI Nifty 50 ETF19,162,0151.763019.9315,200,0002024-07-0526.07%
Parag Parikh Flexi Cap Fund18,706,9735.362948.2215,200,0002024-07-0523.07%
HDFC Flexi Cap Fund - Regular Plan15,200,0005.032395.5215,200,0002024-07-050%
SBI S&P BSE Sensex ETF13,554,0152.042135.8415,200,0002024-07-05-10.83%
ICICI Prudential Technology Fund5,965,6587.68940.1915,200,0002024-07-05-60.75%
Aditya Birla Sun Life Flexi Cap Fund5,791,2564.66912.715,200,0002024-07-05-61.9%
ICICI Prudential Bluechip Fund5,431,0281.72855.9315,200,0002024-07-05-64.27%
Mirae Asset Large Cap Fund5,311,8902.21837.1515,200,0002024-07-05-65.05%
UTI Nifty 50 ETF5,306,3601.76836.2815,200,0002024-07-05-65.09%
Tata Digital India Fund4,983,8868.1785.4615,200,0002024-07-05-67.21%

HCL Technologies Ltd ROCE Trend

HCL Technologies Ltd EPS Trend

HCL Technologies Ltd Key Financial Ratios

MonthMar 24Mar 23Mar 22Mar 21Mar 20
FaceValue2.002.002.002.002.00
Basic EPS (Rs.)57.9954.8549.7741.0740.75
Diluted EPS (Rs.)57.8654.7949.7741.0740.75
Cash EPS (Rs.)73.2369.9465.7558.1253.32
Book Value[Excl.RevalReserv]/Share (Rs.)251.46240.88228.38221.30189.40
Book Value[Incl.RevalReserv]/Share (Rs.)251.46240.88228.38221.30189.40
Revenue From Operations / Share (Rs.)404.84373.69315.47277.64260.32
PBDIT / Share (Rs.)94.6388.3579.5577.2665.95
PBIT / Share (Rs.)79.2673.0863.6160.2753.35
PBT / Share (Rs.)77.2371.7862.4458.3951.49
Net Profit / Share (Rs.)57.8654.6849.8141.1440.73
NP After MI And SOA / Share (Rs.)57.8354.7049.7241.0540.73
PBDIT Margin (%)23.3723.6425.2127.8225.33
PBIT Margin (%)19.5719.5520.1621.7020.49
PBT Margin (%)19.0719.2019.7921.0319.78
Net Profit Margin (%)14.2914.6315.7814.8115.64
NP After MI And SOA Margin (%)14.2814.6315.7614.7815.64
Return on Networth / Equity (%)23.0022.7021.8018.6021.56
Return on Capital Employeed (%)27.9227.5624.5823.7824.47
Return On Assets (%)15.7315.8915.1612.9313.33
Long Term Debt / Equity (X)0.030.030.060.060.05
Total Debt / Equity (X)0.030.030.060.060.09
Asset Turnover Ratio (%)1.140.640.580.510.58
Current Ratio (X)2.612.502.562.481.62
Quick Ratio (X)2.602.492.552.471.62
Dividend Payout Ratio (NP) (%)0.0087.5084.3829.2212.27
Dividend Payout Ratio (CP) (%)0.0068.4063.9020.679.37
Earning Retention Ratio (%)0.0012.5015.6270.7887.73
Cash Earning Retention Ratio (%)0.0031.6036.1079.3390.63
Interest Coverage Ratio (X)46.4667.9567.7041.0535.46
Interest Coverage Ratio (Post Tax) (X)29.4143.0543.3922.8622.90
Enterprise Value (Cr.)401190.95282423.30307290.53262115.68118448.63
EV / Net Operating Revenue (X)3.652.783.593.481.68
EV / EBITDA (X)15.6111.7714.2312.506.62
MarketCap / Net Operating Revenue (X)3.812.913.693.541.68
Retention Ratios (%)0.0012.4915.6170.7787.72
Price / BV (X)6.144.515.104.462.31
Price / Net Operating Revenue (X)3.812.913.693.541.68
EarningsYield0.030.050.040.040.09

HCL Technologies Ltd Profitability Ratios (%)

HCL Technologies Ltd Liquidity Ratios

HCL Technologies Ltd Liquidity Ratios (%)

HCL Technologies Ltd Interest Coverage Ratios (%)

HCL Technologies Ltd Valuation Ratios

Fair Value

Fair Value: 1,610.75

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators.

Undervalued: 6.04% compared to the current price 1519

Intrinsic Value: 1,727.68

Calculation basis:

  • Fair value = P/E Ratio * (Return on Equity / 100) * Book Value * (1 + Dividend Yield / 100) * (1 + EPS CAGR for Last 5 Years)
  • P/E Ratio (Price-to-Earnings Ratio): Represents the price of the stock relative to its earnings per share. A higher P/E ratio indicates that investors are willing to pay a higher price for the stock.
  • Return on Equity (ROE): Measures a company's profitability relative to its shareholder equity. It showcases the company's ability to generate profits using the investment made by its shareholders, offering valuable insight into its operational efficiency and financial performance.
  • Book Value: Represents the net asset value of the company per share. It is calculated as the total assets minus intangible assets and liabilities, divided by the number of outstanding shares.
  • Dividend Yield: The ratio of the annual dividend per share to the current market price per share. It offers valuable insights into the profitability of an investment through dividends.
  • EPS CAGR (Compound Annual Growth Rate): Represents the geometric mean growth rate of earnings per share over the last 5 years. It provides insight into the historical growth trajectory of the company's earnings.

This formula allows us to gauge the fair value of the stock by analyzing its fundamental indicators along with EPS growth.

Undervalued: 13.74% compared to the current price ₹1519

Last 5 Year EPS CAGR: 7.26%

*Investments are subject to market risks

Strength and Weakness of HCL Technologies Ltd Stock

StrengthWeakness
  1. The stock has a high average ROCE of 29.67%, which is a positive sign.
  2. The company has higher reserves (38,809.23 cr) compared to borrowings (3,274.46 cr), indicating strong financial stability.
  3. The company has shown consistent growth in sales (56.92 cr) and profit (11.31 cr) over the years.
  1. The stock has a high average Working Capital Days of 41.42, which may not be favorable.
  2. The stock has a high average Cash Conversion Cycle of 74.42, which may not be favorable.

Should I Buy HCL Technologies Ltd Share Now?

  • Considering all of the following key financial indicators, prospective investors are encouraged to conduct thorough research and seek professional guidance before considering any investment in HCL Technologies Ltd:
    1. ✓ Net Profit Margin: 14.29%
      • Net Profit Margin: This metric indicates the percentage of profit a company makes from its total revenue. A higher net profit margin is generally desirable as it reflects better profitability.
    2. ROCE: 27.92% (Industry Average ROCE: %)
      • ROCE (Return on Capital Employed): ROCE measures a company's profitability and the efficiency with which its capital is employed. A higher ROCE indicates efficient use of capital.
    3. ROE%: 23.00% (Industry Average ROE: %)
      • ROE (Return on Equity): ROE measures a company's profitability relative to shareholders' equity. A higher ROE indicates efficient use of shareholders' funds.
    4. ✓ Interest Coverage Ratio (Post Tax): 29.41
      • Interest Coverage Ratio: The interest coverage ratio measures a company's ability to cover its interest payments on outstanding debt. A ratio greater than 2 is generally considered healthy as it indicates the company can meet its interest obligations comfortably.
    5. Quick Ratio: 2.60
      • Quick Ratio: The quick ratio assesses a company's ability to cover its short-term liabilities with its most liquid assets. A ratio higher than 1 suggests the company can meet its short-term obligations without relying heavily on inventory.
    6. ✗ Stock P/E: 26.3 (Industry average Stock P/E: )
      • Stock P/E (Price-to-Earnings) Ratio: The P/E ratio compares a company's current share price to its earnings per share. A lower P/E ratio relative to industry peers or historical values may indicate that the stock is undervalued.
    7. Total Debt / Equity: 0.03
      • Total Debt / Equity: This ratio measures a company's financial leverage by comparing its total debt to its total equity. A lower ratio indicates lower financial risk and greater financial stability.
    The current analysis is available for review. It's important to conduct thorough research and consider consulting with financial professionals before making any investment decisions.
    Stock Rating: ★★★★☆

FAQ

What is the latest fair value of HCL Technologies Ltd?

The latest fair value of HCL Technologies Ltd is ₹1610.75.

What is the Market Cap of HCL Technologies Ltd?

The Market Cap of HCL Technologies Ltd is 4,12,314 Cr..

What is the current Stock Price of HCL Technologies Ltd as on 06 July 2024?

The current stock price of HCL Technologies Ltd as on 06 July 2024 is 1,519.

What is the High / Low of HCL Technologies Ltd stocks in FY 2024?

In FY 2024, the High / Low of HCL Technologies Ltd stocks is 1,697/1,087.

What is the Stock P/E of HCL Technologies Ltd?

The Stock P/E of HCL Technologies Ltd is 26.3.

What is the Book Value of HCL Technologies Ltd?

The Book Value of HCL Technologies Ltd is 252.

What is the Dividend Yield of HCL Technologies Ltd?

The Dividend Yield of HCL Technologies Ltd is 3.42 %.

What is the ROCE of HCL Technologies Ltd?

The ROCE of HCL Technologies Ltd is 29.8 %.

What is the ROE of HCL Technologies Ltd?

The ROE of HCL Technologies Ltd is 23.5 %.

What is the Face Value of HCL Technologies Ltd?

The Face Value of HCL Technologies Ltd is 2.00.

About the Author

Author Avatar
Getaka

Getaka, CFA, a financial analyst with 15 years of experience in the industry. Getaka holds an MBA degree and the Chartered Financial Analyst designation, demonstrating his profound understanding of financial analysis and investment management. Throughout his career, he has conducted numerous financial analyses and due diligence processes for companies in the industry, and has a strong track record of identifying key trends and opportunities. He leverages his expertise to deliver a thorough financial analysis of a company, encompassing its financial performance, key ratios, future prospects, and risks. Getaka is committed to providing accurate, reliable, and trustworthy information to help readers make informed decisions about their finances and investments.

Disclaimer: This article is for informational purposes only and should not be construed as financial advice. The author is not a SEBI registered financial advisor and does not have any vested interest in HCL Technologies Ltd. Investors are advised to conduct their own due diligence and consult with a financial professional before making any investment decisions. The information provided in this article is based on publicly available data and the author's analysis, but it may not be comprehensive or up-to-date. The author and getaka.co.in are not responsible for any errors or omissions in the content. This article is not intended to promote any particular investment strategy or recommendation, and readers should consult with their own financial advisors before making any investment decisions. Data Source: NSE