March 30, 2020
HCL Technologies Ltd (HCL) has been monitoring the Covid-19 outbreak since late January and had invoked its Business Continuity Plan and Risk Management Framework quite early to minimize the impact on its employees and clients. The situation arising out of this outbreak and its rapid spread across the world is unprecedented and is extremely dynamic. The economic impact is visible with varying degrees of intensity across multiple countries where we operate.
HCL has had a well-defined and structured pandemic policy in place which is resilient, pragmatic and accords paramount importance to employee safety & health and client commitments. We are actively engaged with our clients and have executed the client-specific and HCL internal operations-centric Business Continuity Plan that ensures continuity in delivering to our client and employee commitments. HCL is constantly reviewing the situation at hand with utmost priority and fully complying with all government advisories and recommendations. Given the extended nature of this situation, we have looked at ensuring that we put in medium-term sustainable measures in place to ensure continuity of all our operations and client deliverables. We have been successful in achieving this as of today. A large number of our clients have expressed their deep appreciation of our efforts and speed at which we have been able to achieve the current state.
As of today, 76% of our India-based employees and 92% of our employees in other geographies are enabled to work from home. In certain geographies, a limited set of our employees are working from our offices, wherever it is permissible by the government and local authorities. It is noteworthy that we have not witnessed any outages or major disruption in operations with this newer format of work from home delivery. We would like to use this opportunity to thank our clients, industry bodies and government officials who have been very supportive in our efforts so far.
Likely Impact on business
While the impact on this quarter’s numbers is yet to be quantified, we don’t expect it to be significant. Our exposure to the more impacted verticals are not significant. Booking during this quarter has largely been on track as significant part of closures happened in January.
Our business model is a healthy mix of recurring product revenues, managed services and discretionary spend led professional services. From a vertical perspective, our exposure to verticals like Oil & Gas, Travel & Hospitality, High-End Retail is in single digits.
We recognize our investments in risk management systems and processes over the last several years are helping us to minimize the short-term impact and to be adequately prepared for the medium term, if it gets worse. We are also confident our business model will help us to emerge stronger in the longer term as it has been built for resilience during tough times.
Our wishes of safety and best of health to everyone out there and we hope and pray for the earliest end to the crisis. Keep a safe distance.