HCL TECHNOLOGIES

VIVEK D

(10AA45)

SWOT ANALYSIS HCL TECHNOLOGIES

STRENGTHS

• Wide Range of Products and Services like Bpo’s, Software

.Example:NIIT.

• Services, Infrastructure Management which cater into both

large and medium size companies.

• Global Coverage in countries like U.S, Europe, Japan etc

• Strong employees base of upto 50000Pax.

• Support sales activities by understanding the customer

business better.

• Keep uptodate on what competition is doing.

• Its revenue has increased from 60.7bn in 2007 from 114bn

in 2010.

WEAKNESS

• One of the key weaknesses of HCL is that it has lost projects

in continuation like recently BFSI cuts projects.

• HCL has always a weakness in TIER 1 sectors.

• Total asset turnover is one of the weaknesses of HCL as they

has always failed to materialize its assets in right direction.

• Lack of innovation and distribution network especially in

case of laptops has reflected HCL’s weakness
OPPORTUNITIES

• Acquisitions:-HCL has already done 3 major acquisitions like

Liberta. This enables them to expand and create opportunity
for them to wide there spectrum.

• Key opportunities lies in the countries like Eastern Europe

and APAC(Asia-Pacific Region).

• Opportunity of doing better on return on equity from

21.42% by beating Infosys(26.08%)

THREATS

• One of key threat for HCL and the industry as a whole is the
ban of outsourcing from India due to new regulations from
U.S

• Dip in quarterly Sales by 5% can lead to loss of market

share and product depreciation.

• Small Players and manufactures are trying to enter into the

segment where they can provide much cheaper products
then
HCL which will be a rising competition for HCl to stand.

PEST ANALYSIS IT INDUSTRY

Political

• Taxrates in India for the hardware sector is 20%-30% plus

which creates obvious possibilities for the further reform and
faster growth.

• 10Year Special Economic Zones programs and tariffs change

to promote the hardware production.

• 26 new projects as a part of a national E-Government Plan.

 • Tax initiative by government to ask state government to fix
VAT at 4% in the hope of attracting investors.

• Manufacturing Associations of IT(MAIT) an Electronic Industry

Association of India(ELSINA) are also pressing for reduction
in land acquisitions rights by stamp duty exemptions

Economic

• In last 18months there is growth in sales in PCs and

computer hardware, mainly due to lower prices.

• But as per the trade cycle rotation there will be a possible

slowdown in demand.

• IT plays a important role in bringing 50%of rural household

to the banking innovation.

• IBM, Dell, Lenovo has announced new investment to expand

capacity

• Compound Annual Growth Rate is 15% between 2005-2010.

• Industry contributes upto 7% in GDP

SOCIAL

• Only 1.3% of people in India own a computer

• Age Distribution:- 45% of the population is under 25.

• Regional imbalance and low incomes.

• Inward Investment can lead to better job opportunities.

• Still Abroad is the fascination among the IT professionals to

work.

• IBM, Wipro and Infosys recruit 15000-20000 graduates each

year.

• Business practices varies region wise

Technological

• Plans by AMD to set up the country’s 1st chip fabrication (an

investment upto US$3bn) to stimulate local production and
lower prices.

• Multimedia features and Entertainment to bring bollywood

among the masses.

• Lenovo to built in TV tuner cards capable of connecting to a

TV antenna.