HCL Tech Shares Surge 7% Despite Cautious Q4 Outlook and Neutral Brokerage Ratings

HCL Technologies witnessed a strong market reaction after its Q4FY25 results, with shares jumping over 7% to ₹1,587 on April 23. The surge came despite brokerages largely maintaining neutral ratings, reflecting a cautious optimism around the company’s performance.

The company’s January–March quarter results were in line with expectations, offering some relief amid a challenging environment for IT stocks. Most analysts acknowledged that HCL Tech’s FY26 revenue guidance was slightly better than estimates, but concerns still lingered over the company’s subdued performance in new deal total contract values (TCVs) for the quarter.

Brokerages welcomed the steady quarter but remained cautious due to weak deal wins and a flat growth outlook.

Global brokerage firm Citi retained its “neutral” rating, with a target price of ₹1,510 per share. While Citi appreciated HCL Tech’s stable performance in a traditionally weak quarter, it also trimmed its earnings per share (EPS) estimates for FY26 and FY27 by 2% each, citing expectations of slower growth.

“The management highlighted an environment filled with uncertainty and stated that it would continue to explore new opportunities,” Citi noted.

Looking ahead, the management’s commentary suggested a flat growth trajectory for FY26, with analysts interpreting the guidance as indicating near-zero compound annual growth rate (CAGR) across quarters. This has led several brokerages to adjust their forecasts, even as they acknowledged the company’s relative strength compared to peers.

Despite the mixed views, the stock’s sharp rally signals that investors may be pricing in stability and long-term resilience, especially in a sector currently navigating global uncertainties.