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HCLT reported CC revenue growth of 2.8%QoQ in line with our estimates. EBIT margin dipped 46bpsQoQ to 20.1% due to partial impact of salary hike (80bps). HCLT maintains its CC revenue growth guidance of 12%-14% (3.2% inorganic) which is ahead of peers in the large cap IT space. HCLT is trading at fair valuations of 12.8x based on FY18E earnings; Revenue growth towards the upper end of its guidance will drive upgrades for the stock.
Maintain BUY with a Sep’17 TP of Rs 1,000. HCLT maintained its guidance for CC organic revenue growth of 9%-11% which is higher than peers in the large cap IT space. We pare our earnings estimate for FY18/FY19 by 4%/3% on account of rupee appreciation, higher depreciation charge and tad lower treasury income. We maintain our BUY recommendation with a Sep’17 TP of Rs 1,000 based on 14.5x one year fwd.