HCL Technologies Ltd.

We believe enterprises will continue to scrutinize their IT budgets and delay growth-oriented projects that have longer payback periods depending on the pace of recovery. However, demand for digitalization of operations and contractual project work that allow for remote-delivery is likely to remain steady. This should help HCL Tech's revenue to grow 5%-6% in fiscal 2022 (ending March 31, 2022)- faster than our expectations for the IT services industry of about 3% in 2021. The stable outlook on HCL Tech reflects our view that the company will maintain its good market position and strong operating cash flow over the next 12-24 months. We expect HCL Tech to remain prudent in its growth spending and shareholder distribution and maintain adequate surplus

...HCL Technologies Ltd.'s (HCL Tech) revenue growth will remain sensitive to the pace of recovery in 2021 and 2022. We estimate global IT spending will grow about 3.4% in 2021, lagging our global GDP forecast of 5.0%. Downside risks to our forecasts are likely to persist in the coming quarters depending on the pace of recovery across industry sectors and geographic markets. We expect hard-hit sectors such as hotels and leisure, oil and gas, as well as transportation to improve in 2021, but not fully recover. We believe enterprises will continue to scrutinize their IT budgets and delay growth-oriented projects that have longer payback periods depending on the pace of recovery. However, demand for digitalization of operations and contractual project work that allow for remote-delivery is likely to remain steady. This should help HCL Tech's revenue to grow 5%-6% in fiscal 2022 (ending March 31, 2022)- faster than our expectations for the IT services industry of about 3% in 2021. HCL Tech will...

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