HCL Tech expects to generate $1.3 billion in revenue over the next seven years from its contract with Xerox
The deal marks the renewal of HCL Tech’s engagement with Xerox, which had first awarded a ten-year contract in 2009.
HCL TechnologiesXeroxIT Industry
New Delhi: HCL Technologies Ltd expects to generate $1.3 billion in revenue over the next seven years from its contract with Xerox Corp., the US printer and photocopier giant. Noida-based HCL Tech, which last year surpassed Wipro Ltd to become India’s third largest IT company, said on Tuesday that the deal marks the renewal of the company’s engagement with Xerox, which had first awarded a 10-year contract in 2009. HCL Tech did not, however, disclose the financial details of the earlier contract.
“This expanded partnership is a testament to the strong Xerox-HCL relationship that has grown through multiple collaborations over the past 10 years,” said C. Vijayakumar, chief executive officer of HCL Technologies.
Under the terms of the contract, HCL Tech will help Xerox in administrative and support functions, according to a statement released by the company.
As part of this contract, HCL will absorb some employees from Xerox.
HCL Tech’s latest deal win is the second mega-deal win for the company in the last four years. It had bagged $1.6 billion, five-year contract, from Swedish automaker Volvo AB in October 2015.
Significantly, HCL Tech’s contract with Xerox is the fifth multi-year mega deal won by Indian IT firms in the last 15 months. The other four contracts have brought in at least $7.2 billion in revenue.
In December 2017, India’s largest IT firm Tata Consultancy Services Ltd (TCS) signed a $2.25 billion, eight-year contract with Nielsen, a TV ratings measurement firm, and followed it up with an over $2 billion, 10-year contract with a unit of Dutch insurer Aegon NV in January 2018. Last June, TCS won a third mega deal worth $1.36 billion, for over 10 years, from a unit of British insurer Prudential Plc.
In September, Wipro won its largest contract, valued at $1.6 billion over 10 years from Alight Solutions Llc, the former benefits administration and HR outsourcing business of Aon Plc.
HCL Tech, which ended with $7.84 billion in revenue last year, expects at-best 9.9% dollar revenue growth in the current financial year, implying that it expects to end FY19 with $8.6 billion in revenue.
On Wednesday, HCL Tech shares rose 0.45% to ₹1,039.25 apiece on the BSE while the benchmark Sensex ended the day flat at 38,386.75 points.
This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.