July 14 (Reuters) - Shares of India's HCL Technologies fell as much as 3.2% on Tuesday after analysts said the IT services firm's decision to maintain its annual revenue growth forecast signalled uncertainty in client spending and a slower recovery.
HCL Technologies, India's third-largest software services exporter, beat profit and revenue expectations for the first quarter on Monday, helped by strength in its financial services and a weak rupee.
The company maintained its fiscal 2027 constant-currency revenue growth outlook of 1%-4% and EBIT margin forecast of 17.5%-18.5%.
The unchanged outlook disappointed analysts who had expected stronger forecast after robust deal wins, reinforcing concerns that demand remains uneven across the sector.
Analysts have lowered their expectations for India's $315 billion IT industry as global clients cut non-essential tech spending and fears mount that advanced AI tools could disrupt the business models of software companies.
"The expectation was that the management should have increased the guidance with this strong TCV and doubling growth numbers," said Piyush Pandey, senior vice president at Centrum Broking.
"Since they have maintained the guidance, it roughly indicates that they do see some sort of muted growth performance in the next few quarters," Pandey said.
J.P. Morgan retained its "underweight" rating, saying the unchanged guidance reflected continued weakness in discretionary technology spending, pressure in telecom and manufacturing accounts.
Jefferies maintained its "underperform" rating, citing the unchanged growth outlook was "the key disappointment" and that it pointed to a softer road ahead despite strong bookings and better-than-expected results.
Chief Executive C Vijayakumar said on Monday that there was some impact due to the West Asia conflict and that some softness in discretionary spend persists. However, he said the company sees a large pipeline and healthy bookings, with expectations for strong booking even in the second quarter.
The stock was trading 3% lower and was the top drag in the IT index. It has shed 27.1% so far this year, underperforming the IT index's 23.5% drop.
Reporting by Kashish Tandon and Mridula Kumar in Bengaluru; Editing by Janane Venkatraman and Sherry Jacob-Phillips
Source: Reuters