At HCL Tech, strong deal wins cushion dull Q4 performance

The March quarter earnings performance of IT services provider HCL Technologies Ltd was hardly exciting.

Marred by one-off items, its operating margin took a sharper-than-expected hit. For the quarter, Ebit margin declined 630 basis points (bps) sequentially to 16.6%. Ebit is short for earnings before interest and tax. One basis point is one-hundredth of a percentage point. \

Margins were seen getting impacted by the one-time special bonus of ₹728 crore offered to employees, salary hikes and seasonality in its products and platforms segment. But analysts point out that margin contraction is 230bps higher than consensus estimates.