Premkumar Seshadri, Executive Vice-Chairman and Managing Director, HCL Infosystems Ltd., announcing the results said, “Our second quarter performance is in line with our focus around, execution excellence in our SI projects, momentum in the focus businesses of Distribution and Services and seamless transition of the business model in the Learning and Financial Inclusion space. The renewal of the agreement with Microsoft Devices for another 3 Years and the robust launch of the Lumia 535 and 730 is a key highlight of the quarter”.
Key Updates and Quarter Snapshot
- HCL Infosystems achieved an ICRA Rating of A1 for short term and commercial paper borrowing of Rs 200 Crs.
- Consumer Distribution business comprises of Telecom products and Consumer Electronics & Home Appliances. The Telecom distribution business witnessed a dip in revenues due to product rationalization, which started in Q1 FY15 continued into most of Q2 FY15, and weaker demand environment in the traditional trade channels. However, the Microsoft Windows-based phones business witnessed an 80% Q-o-Q growth in value terms led by the launch of the Lumia 535 and 730 models. In rural markets, the value contribution of Windows-based phones increased from 9% to 25%. The Consumer Electronics & Home Appliances business is gaining momentum by bolstering its channel ecosystem and coverage footprint. In Q2 FY14-15, the number of distributors and dealers increased by over 60%.
- The Enterprise Distribution business achieved good traction by adding new partners like Acer for projectors, Philips for large format displays and others across the Audio-Visual, information security and server storage spaces.We also expanded our reach by signing up with 183 SIs and VARs.
Services Business (HCL Services)
The Enterprise Services business registered a steady growth of 16% Y-o-Y. The global enterprise services business registered a robust 139% Y-o-Y growth due to consistent business traction in our strategically focused overseas markets.
- In the Middle East, the services business registered a healthy Y-o-Y revenue growth of 34%. The business renewed its contractual engagements with existing customers and acquired new customers like Ministry of Health, UAE and a leading telecom operator in the Gulf region. The business also implemented managed services solution for computer-aided facilities management system for a very large public sector enterprise. In Singapore, the services business registered steady growth in revenue.
- Infrastructure Managed Services (IMS) business witnessed growth of 34%Y-o-Y. In this quarter, IMS bagged service contracts from a large private bank, public sector bank and a large Indian conglomerate among many others.
- The Infrastructure Consulting Services business won major orders from marquee customers in the enterprise and government space.
- The business made significant enhancements of proprietary tools that received customer accolades and have the potential of creating sustainable competitive differentiation.
- The Enterprise business continues to strengthen and drive synergy in its channel partner ecosystem to expand its presence in the SMB and mid-market segment.
- Our Consumer Services business maintained its consistent growth momentum by registering 129% Y-o-Y and 15% Q-o-Q growth in the quarter. The Consumer Services business also signed up with leading brands like OnePlus, Jolla and Xolo across the Mobility space for after-sales repair and services. HCL Consumer Services also launched a new cloud-based CRM to provide warranty transfer and fraud detection facilities to its partners.
HCL Learning Business (HCL Learning):
HCL Learning has changed its business model to an asset-light, content-driven business.
The entity has formed strategic partnerships with RICOH in India and Westcon in the Middle East to penetrate new market segments.
In India, the HCL Learning has added many new customers like Udgam School, Gujarat, Delhi Public School, and Jharkhand through its channel partners. In the international market, it acquired customers like Global Indian International School, Japan, Indian School Darsait, Oman and Indian Language School, Nigeria.
Gaining recognition for its interactive content expertise, HCL Learning won many awards such as Global LearnTech Award and Digital Edge Magazine Award.
System Integration (SI) Business:
- One of our key projects, Managed Services for Unique Identification Authority of India (UIDAI) is progressing as per plan, and the technology platform migration for the world’s largest biometric database has been completed even as 73.25 Crs Aadhaar cards have been generated.
- The rigorous thrust on execution excellence and collections is helping in accelerated project implementation and selective pursuit of new opportunities that has resulted in expanding relationships with existing customers.
Financial Inclusion (FI) Business:
- Financial Inclusion business achieved a landmark of 50 lac enrollments since its inception and the execution model transition here is gaining momentum.
- The Financial Inclusion business won a major order for covering more than 900 villages from Uttar Bihar Gramin Bank. The business developed tools for enabling inter-operability between bank branches and e-KYC implementation.