In an interview with ET, HCL Tech president and CEO C Vijayakumar said although demand for digital technologies is accelerating, the chief matter of concern is that the Covid-19 pandemic is still raging. Vijayakumar also said HCL Tech had no immediate plans for a buyback unlike some of its peers and is instead giving out a higher dividend. Edited Excerpts:
ON ‘CAUTIOUS’ OPTIMISM
All the indicators of demand and demand pipeline, deal closures, etc, are looking positive. But, keep in mind weâre still in the middle of this pandemic and even last week some geographies announced lockdowns. So, while we believe we can navigate it because a lot of work is getting done remotely, thatâs just one element we have to keep in mind before we become extremely optimistic about everything.
Most clients want to continue their transformation programmes as they believe that these programmes are very essential to increasing the resilience of the business and increasing relevance and modernisation – all of that is very important. So, there was an initial stoppage of projects, maybe in March-April. But very soon they recognised that they need to prioritise the key projects, and then ensure that those are progressing well. And, that is why you see the revenue guidance we gave versus what we really delivered, is because a lot of customers that ramped down, quickly reprioritised and said these are the areas which we want you to work on.
Which are the stressed sectors?
The sectors which are seeing quick cost reduction are the energy sector, some segments of retail CPG – customers who’ve seen some significant contraction in demand. They’re looking at how to get the demand back.