HCLTech books $2.4bn in deals, plans 3,500 crore rupee AI datacentre
HCLTech posted a strong $2.4 billion in quarterly deals but kept its full-year guidance unchanged as it announced a ₹3,500 crore datacentre investment to address AI compute constraints, marking a shift from its traditional asset-light model.
HCLTech reported total contract value of $2.4 billion for the latest quarter, a significant increase from $1.9 billion in the previous three months. The company stated its order pipeline remains strong and projected that deal bookings would improve further in the upcoming September quarter. However, this underlying optimism did not translate into an upgraded financial outlook.
The Indian software exporter, which ranks as the country's third largest, kept its full-year revenue guidance unchanged at 1-4% in constant currency terms. Its operating margin guidance also remained steady within a band of 17.5-18.5%. The disconnect between robust deal wins and flat guidance underscores ongoing caution regarding client discretionary spending, leaving the stock largely range-bound until a clearer trend emerges.
Beyond its quarterly earnings, HCLTech unveiled a notable strategic shift by committing ₹3,500 crore in capital expenditure to construct a 50 megawatt datacentre. The new facility is intended to help the company deliver full-stack artificial intelligence solutions. Management cited a specific scarcity of datacentre capacity required for the compute and training stages of AI models as the primary driver for the investment.
The project will be funded through a combination of debt and equity, though executives noted that further clarity on the financing structure is awaited. This capital allocation marks a departure from the asset-light model that traditionally defined India's IT services sector. It follows a similar, albeit much larger, move by sector leader Tata Consultancy Services.
TCS became the first top-tier Indian IT firm to announce a datacentre push last October, planning a roughly ₹55,000 crore investment to create a one gigawatt facility. When that announcement was made, HCLTech publicly stated it had no intentions to foray into such a venture. The reversal less than a year later illustrates the pressure on service providers to secure proprietary AI infrastructure.
Investors should view the datacentre project as a medium-to-long-term initiative rather than an immediate catalyst for earnings. The ultimate success of the facility will depend heavily on HCLTech's effectiveness in customer engagements and its agility in handling rapid technological shifts within the artificial intelligence landscape.
