HCLTech shares rose 7.47% on Tuesday after the company reported stronger-than-expected Q2FY27 results. The stock reached ₹1,314.40 by mid-session, touching an intraday high of ₹1,316.40. The rally followed the earnings announcement released after Friday’s market close.
HCLTech shares have recovered sharply from their 52-week low of ₹1,030, recorded in July. However, the stock remains below its February peak of ₹1,780.10. Trading volume crossed 1.34 crore shares by 12:26 p.m., while buy orders accounted for nearly 65% of the order flow.
The quarterly results showed improving profitability, stronger services revenue, and rapid growth in advanced artificial intelligence (AI) revenue. The company also raised its FY27 revenue growth guidance and announced a global partnership with Anthropic to support enterprise AI adoption.
Key Highlights
- EBIT margin increased 131 basis points quarter-on-quarter to 18.2%, its highest level in 20 quarters.
- Advanced AI revenue rose 28.4% quarter-on-quarter to $219 million.
- New deal total contract value reached $3.25 billion, up 26.8% year-on-year.
HCLTech Q2FY27 Results Show Stronger Margins and AI Growth
HCLTech reported an EBIT margin of 18.2%, marking a 131-basis-point improvement from the previous quarter. Services revenue grew 3% quarter-on-quarter in constant currency, indicating continued demand for its core services.
Advanced AI revenue emerged as a key growth driver, reaching $219 million during the quarter. This represented a 28.4% increase from the previous quarter. The company also secured new deals worth $3.25 billion in total contract value, reflecting a 26.8% rise from the year-ago period.
HCLTech raised its FY27 revenue growth guidance to 2.5%–4% in constant currency. However, the midpoint of its organic growth outlook remained broadly unchanged.
The company also announced a Global Premier Partnership with Anthropic. The collaboration aims to accelerate enterprise AI adoption, adding to HCLTech’s efforts to expand its presence in AI-led services.
Despite the strong performance, the software segment remained a concern. Revenue from the segment declined 11.2% year-on-year in constant currency, offsetting some of the strength in services.
HCLTech Shares Face Mixed Signals From Analysts
Brokerage firms remain divided on the stock’s outlook, with some seeing further gains from AI monetization and others warning about valuations and slowing organic growth.
Anand Rathi upgraded HCLTech to Buy with a target price of ₹1,435, citing AI monetization opportunities and the Anthropic partnership. Nomura also maintained its Buy rating, with a target of ₹1,330.
HSBC and CLSA retained their Hold ratings, setting target prices of ₹1,225 and ₹1,094, respectively. Kotak Securities and JM Financial maintained Reduce recommendations, with targets of ₹1,220 and ₹1,160. Both flagged valuation concerns and weakness in the software business.
JPMorgan maintained an Underweight rating with a target price of ₹1,080, while Citi issued a Sell rating with a target of ₹1,050. Both pointed to slowing organic growth and HCLTech’s valuation premium of 20%–25% over peers Tata Consultancy Services (TCS) and Infosys.
The latest rally reflects investor confidence in HCLTech’s earnings performance and AI growth prospects. However, the software segment’s weakness, organic growth concerns, and divided analyst views remain important factors for investors to watch.
