HCL Tech reported good set numbers for its Engineering and R&D Services (ERS) business in Q1 FY21. Revenues were down by 5.1% at CC to USD 378m. The growth is mostly organic (CS) and only includes an estimated USD 5m in acquired revenues, resulting from the Sankalp acquisition. This positions ERS among the best-performing units this quarter.
HCL Tech’s ERS accelerated its yoy growth in Q2 FY20 to +15.0% at CC, from +13.3%. Its EBIT margin also increased from 16.0% in Q1 to 21.4% in Q2. The financial improvement results from mostly a catch-up effect: ERS recognized revenues in Q2 that it could not in Q1.