HCL Technologies hits record high; stock up 24% in three months

Shares of HCL Technologies hit a record high of Rs 1,125 per share, up 2.6% in intra-day trade, surpassing their previous high of Rs 1,107 per share recorded on April 23, 2018, on the BSE.
The stock was trading above its share buyback price of Rs 1,100.

In the past three months, HCL Technologies has outperformed the market by surging 24% after the company announced the share buyback proposal. In comparison, the S&P BSE Sensex was up 4% during the period.

The stock had turned ex-date for buyback of shares on August 30, 2018. IT services firm said its Rs 40 billion buyback offer will commence on September 18 and will close on October 3.

Analysts at JP Morgan overweight on HCL Technologies with Jun-19 price target of Rs 1,180 (previously Rs 1,050).

“Our price target is based on a one-year forward P/E multiple of 15.5x mildly increased from 15x as weaker INR allows HCL Technologies to make investments that it might have otherwise deferred helping the cause of revenue growth. We factor in higher margins in FY19 vs. FY20 as gains from the weaker INR (in FY19) will get passed on to clients effective FY20,” the brokerage firm said in IT Services sector update.

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