The information technology space is grappling with higher recruitment costs due to attrition issues that have plagued the market for some time now. With the increase in the number of jobs in the IT space, due to its growth even when the economy slowed down due to the COVID-19 pandemic, employers in the space have struggled to keep the talents intact without disturbing the margins.
However, attrition is starting to level off for HCL Technologies, Chief Financial Officer Prateek Aggarwal said in an interview with CNBC-TV18. He expects it to decline further in the coming quarters.
Aggarwal explained that the company’s strategy is to get more and more newbies on board. In fact, fresher consumption has increased by more than 50% in the last 3-4 years, he said. He estimates that the hiring of new students will be over 30,000 next year. The figure has fallen from 9,000 in 2003 to 22,000-23,000 last year.
He explained that the company has an agile model when it comes to salary increases. He expects to cut costs by balancing hiring and making new hires more productive, so margins can improve in the future.
Major computer technologies HCL released its fourth quarterly results on Thursday. The company exceeded Street’s expectations with a dramatic 226% increase in net profit to Rs 3,593 crore for the quarter ended March 31, 2022. It had reported a net profit of Rs 1,102 crore, in the corresponding quarter from last year.
The company’s operating revenue for the fourth quarter of FY22 was Rs 22,597 crore, up 15% from a year ago.
The company’s platform products and business performed poorly. C Vijayakumar, CEO and MD, HCL Tech, said the vertical will be volatile. He explained that he will start experiencing gradual growth as it is still a new business.
He mentioned that this is a strategic bet for the company, however the service business will grow faster than the product business.
Thanks to its performance, shares of HCL Tech were trading up 2% in early trading on Friday. It is currently trading at Rs 1,119.40 up around 20% in the last day alone, on the Bombay Stock Exchange (BSE).
On Thursday, the stock closed up 0.92% at 1,099.60 rupees on BSE. The company’s market capitalization has risen to Rs 2,98,394.61 crore.
Watch the video for the full interview.
First post: STI