Buy HCL Technologies, target Rs 1050: CLSA

CLSA has Buy call on HCL Technologies Ltd. with a target price of Rs 1050.0. The current market price of HCL Technologies Ltd. is 786.9. Time period given by analyst is year, when HCL Technologies Ltd. price can reach defined target. The management remains confident about the revenue growth guidance of 11.2-13.2 per cent on a year-on-year (YoY) basis. The guidance reiterated by the company despite recent caution cited by peers is a positive sign. The global investment bank sees stronger visibility afforded by a higher mix of Infra Mgmt Services and lower BFSI exposure. CLSA reiterates confidence in margin guidance of 19.5-20.5 per cent for FY17. The IT major could still see an impact of the cloud as revenue-neutral and margin-accretive. It looks like digital catch-up has already begun to counterbalance ERP decline.