Reduce HCL Technologies; target of Rs 1090: ICICI Securities

ICICI Securities's research report on HCL Technologies HCLT reported healthy revenue growth in IT Services and ER&D at 3% QoQ CC (2.3% organic). Management noted improving demand momentum in last few weeks of Sep-26 quarter and citied expectations that Services revenue growth would fare above the mid-point of its guidance. However, management also acknowledged that the IT Services industry is in the early phase of an AI-led deflation, and demand environment continues to be volatile. Moreover, product business continues to drag revenues down. EBIT margin performance was impressive, aided by operating leverage, employee restructuring benefits, and higher-margin AI revenues. Nevertheless, we expect margins to remain rangebound as the company prioritises investments for growth. Outlook Maintain REDUCE with a revised TP of INR 1,090, based on 15x FY28E P/E for the services business and 10x for the products business. For all recommendations report, click here Disclaimer: The views and investment tips expressed by investment experts/broking houses/rating agencies on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions. HCL Technologies - 1310026 - icici