The key digital

disruptions that are leading this transformation include

automation, block chain, cloud, digital twins, Internet of Things
(IoT), and artificial intelligence (AI).

A threelane
“highway,” Mode 1-2-3 is at the core of HCL’s strategy
 Under Mode 1, HCL continued to strengthen its core services
and leveraged DRYiCETM, the automation and orchestration
platform, to drive significant business outcomes for several
global enterprises. Existing clients renewed engagements with
the company and new deals were successfully closed in the
financial year gone by. Hence, the attempt to increase market
share since last year fructified into concrete results.

The Mode 2strategy revolves around stepping up the game and leveraging
high-growth business opportunities.

HCL, leveraging its Mode 3 strategy (revolving around

monitoring trends influencing and shaping the future), was
successful in filing new patents in next-gen technologies,
adding and expanding existing IP partnerships, and developing
the first XaaS service management system (as DRYiCETM SX
and XSM come together).

Mode 1: Core Services- HCL delivers the core services in areas of

Applications, Infrastructure, BServ and Engineering & R&D,
leveraging DRYiCE™ Autonomics to transform clients’ business
and IT landscape, making them “lean” and “agile.” Through Mode
1 services, HCL augments its clients’ core capabilities, expanding
their global footprint and consolidating existing operations

Mode 2: Next-Generation Services

Under Mode 2, HCL delivers experience-centric and outcomeoriented
integrated offerings of Digital and Analytics, IoT
WoRKS™, Cloud Native and Cybersecurity,.

Mode 3:
DRYiCETM
Mode 1-2-3 Revenue Mix EBIT Margin QoQ Growth
Highlights Revenue (in Constant Currency)
(in US$ mn)
Mode 1 1,561 70.9% 20.7% 3.9%
Mode 2 377 17.1% 12.3% 13.1%
Mode 3 263 11.9% 23.0% 6.2%
Total 2,202 100% 19.6% 5.6%

This quarter, HCL delivered a solid industry leading 5.6% sequential growth in constant currency. The growth was
driven by services across Verticals and Geographies led by Mode-2 services that grew 13.1%, Mode-3 6.2% and
Mode-1 3.9%

Mode 2 crosses US$ 1.5 bn run rate. The robust growth in Mode-2 Services was fueled by all the components that
include Digital & Analytics, Security, IoT and Cloud Native services.

Mode-1 growth was driven by IMS, ERS and Applications, all of them demonstrating strong traction

This quarter, HCL announced a definitive agreement to acquire select IBM software products for an aggregate value
of US$ 1,775 mn

Revenue: FY'19 Revenues are expected to grow between 9.5% to 11.5% in Constant Currency
* Revenue Guidance is based on FY’18 (April to March) average exchange rates.
The above constant currency guidance translates to 7.9% to 9.9% in USD terms based on Dec 31, 2018 rates.

FY’19 expected Operating Margin (EBIT) range is from 19.5% to 20.5%.

The acquisition will give boost to mode3 business and aos help in developing the mode
1 and mode 2 business

Mode 2 cagr is growing by 24% cagr in last 2.5 years

Mode 3revenues increased from 4% to 12% in last q ( because of IP partnerships)
9.5% to 11.5% guidance of revenue for fiscal 19

1.8 Bn inxst in IBM or 1775mn (financed through internal accrual)((might need to borrow
300mn for paying the 52% after 12 mnths of deal close )
This deal will help to get Hcl tech 5000 enterprises across different geographies
Incremental revenue in year 2 after close will be around 650mn & ebitda margin around
15% because the revenue will be little lower in Year 1 and margin (The 650 mn would
be otherthan the current revenue and it would come at a cost of 1.8 bn invst)& 625 mn
in first year after close

Most of the products overlap with HCL’S bt it will give a reach to the company to catera
large no of customers
These intergerated products will access to markets suh as ajapan china s.a middle east