HCLTech Q2 Results Review: Strong Bookings Underpin Revenue Visibility
HCLTech Ltd. delivered a strong Q2 FY26 performance, with revenue growing 2.4% QoQ in constant currency and 2.8% in USD, ahead of expectations. The company’s strong bookings and revenue growth have led Systematix to maintain its ‘Hold’ rating on HCLTech.
Q2 Results Highlights
The Q2 results were marked by a steady momentum in the services business, with HCLTech raising the lower end of its FY26 services revenue growth guidance to 4–5% (from 3–5%). This upward revision in guidance reflects the company’s confidence in its ability to deliver strong revenue growth in the coming quarters.
The strong bookings and revenue growth were driven by a robust demand for digital transformation services, cloud migration, and cybersecurity solutions. HCLTech’s investments in emerging technologies such as artificial intelligence, blockchain, and the Internet of Things (IoT) have also started to pay off, with the company witnessing a significant increase in demand for these services.
Systematix Maintains ‘Hold’ Rating
Systematix has maintained its ‘Hold’ rating on HCLTech, citing that the stock does not offer much upside from the current market price. The brokerage firm believes that the company’s strong Q2 performance and upward revision in guidance are already factored into the stock price, leaving limited room for further appreciation.
However, Systematix has praised HCLTech’s strong bookings and revenue growth, stating that the company’s ability to deliver consistent growth in a challenging environment is a testament to its strength and resilience. The brokerage firm has also highlighted HCLTech’s strong balance sheet and cash flow generation, which provides the company with the necessary resources to invest in growth initiatives and return value to shareholders.
Indian IT Sector Outlook
The Indian IT sector has been witnessing a significant slowdown in growth, with many companies facing challenges such as a strong US dollar, trade tensions, and a slowdown in global economic growth. However, HCLTech’s strong Q2 performance and upward revision in guidance suggest that the company is well-positioned to navigate these challenges and deliver strong growth in the coming quarters.
The Indian IT sector is expected to witness a significant increase in demand for digital transformation services, with many companies looking to leverage emerging technologies such as artificial intelligence, blockchain, and the Internet of Things (IoT) to drive growth and improve efficiency. HCLTech’s investments in these areas are expected to pay off, with the company witnessing a significant increase in demand for these services.
Investment Strategy
For investors looking to invest in the Indian IT sector, HCLTech is a good bet, given its strong track record of delivering consistent growth and its investments in emerging technologies. However, investors should be cautious and not expect significant upside from the current market price, given the already factored-in strong Q2 performance and upward revision in guidance.
Investors can consider investing in HCLTech for the long term, given its strong balance sheet and cash flow generation, which provides the company with the necessary resources to invest in growth initiatives and return value to shareholders. To learn more about long term investing strategies, click here.
Conclusion
In conclusion, HCLTech’s strong Q2 performance and upward revision in guidance are a testament to the company’s strength and resilience. While the stock may not offer significant upside from the current market price, it is a good bet for investors looking to invest in the Indian IT sector for the long term. To stay updated on the latest Indian stock market news, click here.
Related News
For more news and updates on the Indian stock market, including Nifty today and Sensex news, click here. To learn more about Q2 results analysis and other corporate actions, click here.
