ASSIGNEMENT-1

HCL TECHNOLOGIES LIMITED

Technology that touches Life..

Submitted By:
Anisha Pillai (#40404)
Aziz Umrethwala(#40405)
MBA Exe(17-20) Lavale Batch

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Findings- Company Profile
HCL Technologies Limited (Hindustan Computers Limited) is an Indian multinational
technology company, headquartered in Noida, Uttar Pradesh, India. It is a subsidiary of HCL
Enterprise. Originally a research and development division of HCL, it emerged as an
independent company in 1991 when HCL ventured into the software services business. The
company has offices in 39 countries including the United States, France and Germany, and the
United Kingdom with a worldwide network of R&D, "innovation labs" and "delivery centres",
and 120,000+ employees and its customers include 250 of the Fortune 500 and 650 of the
Global 2000 companies. Shiv Nadar was the founder and chairman of HCL. Nadar founded
HCL in the mid-1970s and transformed the IT hardware company into an IT enterprise over
the next three decades by constantly reinventing his company's focus.

HCL Enterprise was founded in 1976.

The first three subsidiaries of parent HCL Enterprise were:

 HCL Technologies - originally HCL's R&D division, it emerged as a subsidiary in 1991

 HCL Infosystems and
 HCL Healthcare
The company tried to stay focused on hardware, but, via HCL Technologies, software and
services is a main focus.

Types of Business method

If we talk about the business method, HCL is into many fields. They have 3 modes in which
their business types as been distributed. Below table shows all the business lines in which HCL
in involved.

Shareholding Pattern
As Per BSE: Shareholding pattern simply mean how much percentage the promoters are
holding and how much percentage the public is holding. Every companies realises their share
holding pattern four times a year i.e. quarterly. If we look at the shareholder pattern of HCL
we can see that promoter share is 60% and public share is 40% as per BSE. Refer the below
image.

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As per BSE we can see that in HCL promoter holds share of 60% whereas public share is 40%
as of December 2018. If we look at further distribution of promoters shareholding pattern we
can see that Shiv Nadar (Founder of HCL) is holding the highest no. of shares i.e. 368.

Looking at the public holding of HCL shares we can see that ICIC mutual funds are holding
the highest number of shares. Public holding comprises of mutual funds, foreign portfolio
investors, insurance company and other alternate investment funds.

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By just looking at the shareholding pattern doesn’t give us a very clear picture of the changes.
If we compare the shareholding pattern of December 2018 with December 2017 we can see
that in December 2017 the promoters were holding 60.19% whereas public was holding
39.81% (Refer the below image). We can now see that the promoters shareholding has
decreased by 0.19% and similarly the shareholding of public has increased which means they
have sold their shares to the public in 2018. If the promoter shareholding % declines very
frequently it means that the company is not earning a profit, but by just comparing few
shareholding pattern we cannot conclude.

II. GROWTH RATE ANALYSIS

A. Revenue / Sales- Growth Rate for last 5 years
REVENUE / SALES GROWTH- 5 YEARS
Year 2013 2014 2015 2016 20172018 CAGR
Revenue
/ Net
6%
Sales 12,517.82 16,497.37 17,153.44 13,434.64 19,318.00 22,073.00
Growth 0.00% 24.12% 3.82% -27.68% 30.46% 12.48%
-The CAGR for Total Revenue is 6% for last 5 years.

B. Net Profit (PAT) for last 5 years

NET PROFIT AFTER TAX- 5 YEARS

Year 2013 2014 2015 2016 2017 2018 CAGR
PAT 3,704.72 5,984.62 6,345.95 4,719.08 6,873.00 7,362.00
4%
Growth 0.00% 38.10% 5.69% -34.47% 31.34% 6.64%
- The CAGR for Net Profit is 4% for last 5 years.

C. Total Capital: Equity + Debt (if any)

Total Capital (Equity + Debt)

Year 2013 2014 2015 2016 2017 2018
Total Capital
(Equity + Debt) 15,959.33 5,343.08 5,000.38 4,512.99 32,371.00 32,818.00
Growth 0 -66.52% -6.41% -9.75% 617.28% 1.38%

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III. SEGMENTWISE REVENUE

A. Countries for Revenue

The Group operates from four geographies: America, Europe, India and Others.
 Europe mainly comprises of business operations conducted in United Kingdom,
Sweden, Germany, Italy, Belgium, Netherlands, Northern Ireland, Finland, Denmark,
Norway, France, Poland and Switzerland.
 All other customers, mainly in Japan, Australia, New Zealand, Hong Kong, Singapore,
South Africa, China, Philippines and Malaysia are included in Others.
As per Economic times: The Nordic region which comprises of Denmark, Finland, Iceland,
Sweden and Norway has transformed into a major growth in 2018. The other countries which
contributes in the revenue generation of HCL are America, European market which includes
United Kingdom, Austria, Germany and Switzerland.
As per the Annual report published Europe accounted for 26.8% of HCL technologies revenue
for the quarter ended September 2018 which has grown by 3.5% annually. America contributed
65.8% and rest of the world contributed for 7.4% of the revenue in the last quarter. The
company has not disclosed country specific contribution to the revenue. In the quarter ended
September 2018 the Nordics region has shown a tremendous growth.

"HCL has been present in the Nordics region for 10 years now and have over 1,600 employees
in the region and 12 delivery centres. We have over 50 large-scale clients, including four out
of the six Fortune Global 500 companies in the region. We will continue to invest in this market
that is the largest for us in the European region"
-HCL Technologies EVP Nordic Head Pankaj Tagra
B. Segment-wise % Total Sales (CAGR)- In Crores

Segmentwise % of total sales (CAGR)

YEARS CAGR
Particulars
2013 2014 2015 2016 2017
Software Service 16,975 66.4% 19,708 61% 22,179 60.4% 18,390.00 59.1% 27,139.00 57% 10%
Infrastructure Service 7,525 29.4% 11,050 34% 12,825 34.9% 11,085.00 35.6% 18,543.00 39% 20%
BPO Services 1,081 4.2% 1,386 4% 1,697 4.7% 1,661.00 5.3% 1,886.00 4% 12%
Total Revenue 25,581 100.0% 32,144 100.0% 38,717.00 100.0% 33,153.00 100.0% 47,568.00 100% 13%
- The Total Revenue CAGR for all the 3 segments come across to 13% for last 5 years.
C. Segment wise analysis of Net profit (CAGR)-In Crores

Segmentwise % of Net Profit (CAGR)

YEARS
Particulars CAGR
2013 2014 2015 2016 2017
PAT for 3 Segments 2422.7 6509.51 7317.07 5643.04 8606.33 29%
-The Net Profit CAGR for Last 5 years come across to 29% for all the 3 segments of HCL.

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D. Historical Price Chart of US for last five years

Year USD/INR
Jun-13 59.88
Jun-14 59.61
Jun-15 63.19
Mar-16 67.12
Mar-17 64.25
Mar-18 64.95

Note: The above prices are taken in respect to the FY closing of HCL Technologies.

E. Comparision of Net Profit with US $ for last 5 years

Year PAT (INR'crs) PAT ($) in millions USD/INR

Jun-13 3,704.72 618.69 59.88
Jun-14 5,984.62 1,003.96 59.61
Jun-15 6,345.95 1,004.26 63.19
Mar-16 4,719.08 703.08 67.12
Mar-17 6,873.00 1,069.73 64.25
Mar-18 7,362.00 1,133.49 64.95

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F. Comparision of Total Sales with US $ for last 5 years

Year Sales (INR'crs) Sales ($) in millions USD/INR

Jun-13 12,517.82 2,090.48 59.88
Jun-14 16,497.37 2,767.55 59.61
Jun-15 17,153.44 2,714.58 63.19
Mar-16 13,434.64 2,001.59 67.12
Mar-17 19,318.00 3,006.69 64.25
Mar-18 22,073.00 3,398.46 64.95