Thank you very much. Our first question comes from the line of Abhishek Pathak from Motilal Oswal Financial Services Limited. Please go ahead.

Yes, hi, thank you for the opportunity. My first question is on the deflation number that CVK referenced. So CVK, on the 3% to 5% deflation estimate that we have, what is the risk that this number kind of keeps expanding over, let's say, the next 2 to 3 years as model capabilities improve, and more and more of what IT services kind of provide comes under the ambit of what GenAI can do? That's the first question. And the second question is - as an offset to that is, you did mention your GenAI offerings across be it Chip Design, be it Agentic AI, etc. So, across those five offerings that you have, which of the offerings do you think are seeing the maximum uptake and where you feel like over-indexing a lot over the next 2 to 3 years so the impact of deflation kind of gets offset? And if I could just squeeze in one more on the guidance front, how much of the guidance softness comes from geopolitical pressures and how much of it comes from the event that have happened between the last 2 to 3 months that includes, the release of Opus 4.6 or the geopolitical impact that we've had? Thank you.

Thank you, Abhishek. Let me answer one by one. Starting with the deflation number, 3% to 5% that I shared is mostly based on the industry mix of services. And for the specific question on how it changes with respect to the model effectiveness, I think most of the enhancement in models are really driving more and more velocity and efficiency in the SDLC lifecycle. I think that piece could go through a little higher deflation based on the model outcomes. In rest of the areas, it is Agentic, it is human -in-the-loop, and even the latest model on Anthropic's Mythos, ability to run production environment fixes without human -in-the-loop is very limited. And this has been acknowledged even in their own release n otes. It depends on the service mix. For us, we called out 2% to 3% and I think that holds true even now. In terms of new services, I think that's a great question. We have obviously called out 5 key areas, which is Physical AI, AI Factory, Custom Silicon Engineering for Inferencing, AI -led Marketing Services, and IP and Platforms. Of course, IP and platforms are integral to a lot of service transformation. It has a very small component of IP embedded into it. AI Factory is where we are seeing tremendous traction. One of the large deals that we called out this quarter is a $100 million+ AI factory deal for design, implementation and support of a next-gen AI data center for a large Technology company. So, I think we are seeing good traction. We are already now into two major clients for this, and we hope to get to another three or four more in this coming year. Similarly, Semiconductor Engineering, we also announced a new deal this quarter on Physical AI, which is really some ASIC development work on advanced nodes, which is also the cutting -edge work, and these are the areas which we are doubling down and we see great traction. Coming to the guidance, what it takes in, I don't want to kind of say that geopolitics is driving this. I would want to be more specific. Of course, there has been some impact in March, which is what is reflected in our significantly lower revenue in Q4. A nd as I said, two large Telecom clients have cut down on the discretionary spent for this calendar year. I see that continuing till end of the year. A couple of SAP programs got discontinued. That will also have an impact. We are seeing some softness in Europe, and the US seems to be quite robust except for this specific client situation that I called out. For FY’27, we see a half a percent reduction due to two clients and their own business challenges. We continue to have a very high wallet share, but their own business pressures have reduced significant spend and that is what is driving the overall guidance.

Thanks CVK, all the best.

Thank you. Our next question comes from the line of Sudheer Guntupalli from Kotak Mahindra Asset Management Company. Please go ahead.

Hi, CVK. Just one clarification. These two SAP programs and the two Telecom accounts, are they overlapping or are they two separate events? Number two, what gives us the confidence that these two might be isolated events and there is no underlying factorial or causality driving this at a vertical level, at either a Telecom vertical level or maybe in a broader set of SAP implementation programs or in any geography at this stage? And the third one if I may squeeze in, if you add back that 50 basis points of impact because of these two accounts, still it would be like you are essentially talking about 2% to 5% kind of growth in services, which might be a bit tad softer than what we are anticipating. So anything to explain that delta, that would be helpful. Thank you.

Two Telecom clients and the two other clients are completely different. The two other clients where there is a half -a-percent decrease in FY'27 guidance, one is a large Manufacturing client, other one is a Retail client. So there is no overlap in these clients. Now, what gives us confidence? This is restricted. As I said, in the lower end of our guidance, we are baking in that the softness continues. That is what we have baked in at the lower end of our guidance. And I think, given it is a well -known fact that 2% to 3% deflation happens, I think barring this, getting to 2% to 5% is a reasonable growth in the given environment and in so much of uncertainty. I think it is good and this of course does not include any acquisitions and they will get closed sometime during the year and we will call it out separately.

Fair enough, CVK. Thanks a lot.

Outside of these two data points that we shared, the business continues to perform at the same pace. I think we have done enough. So that is how we have arrived at our guidance.

Our next question is from the line of Nitin Padmanabhan from Investec. Please go ahead.

Yes. Hi. Good evening. Thank you for the opportunity. The impact we had in Telecom this quarter, I think sequentially some $12-odd million, so that began in March. We should assume that you will see a full quarter kind of an impact in the next quarter. So over and above this 50 basis points which is with those two other clients, this itself is quite a drag. Is that a fair understanding? Almost a 1% drag?

Yes, I wouldn't say that it was only in March, though the decision got communicated to in March, but it does have a little more impact than just one month because I think these were the SOWs which were expected as a part of CY'26 spend, and it was dragging and finally it was called off. I would say it's a little more than a month. We are assuming at least that i t is there till end of the year and that is all accounted in our guidance.

Sure. That's helpful. The second one I wanted to ask you was on the cancellation of SAP programs. Is this purely a budget decision or is it a technology or that kind of a strategic decision on the cancellation of the SAP programs?

I think these were related to the client budgets. I think they kind of de-prioritized this modernization. I think there is a general understanding that the timelines for some of this is also going to get extended from SAP. I mean, some of that is probably playing into these decisions.

Sure, that's helpful. Just one last one from my end. On the products business, considering that a lot of these were end of life which were built on and tried to modernize, in the context of whatever we are seeing with AI and all of that, how are you thinki ng about the long - term trajectory of this business? And are we likely to see some, maybe a higher cadence on new product launches from your end to make up for that?

Firstly, this Q4 revenue decline is not related to anything on AI or any of the latest developments. As you know, the last fortnight of the quarter is crucial for all the deal closures in the Software segment. I think the situation in West Asia led to deferral in client decision - making and some of the delays in the US government also caused this. We expected it to get done before March, but they didn't get done. And then, of course, a couple of other situations where some client stakeholder changes and all that overall led to a little more scrutiny and more review of the deals. I think it's very specific and our long - term trajectory for Software business remains intact. There are three broad portfolios - One is data; second is operations, which is all our IntelliOps and AEX; and the third is experience, which has got some of the declining products. So, I think the two categories which I called out, data and operations, are growth -oriented. They will get offset by the declines in the experience portfolio. So, our expectation is low -single digit, flattish or marginally declining, in the coming year. As the recurring part of the portfolio improves, that will also help. If you see on a YoY basis , we had a decline, bigger decline in the perpetual licenses and maybe a slight decline or flattish in the steady stream revenue. So, I think we need to kind of go through the entire cycle, b ut it's not something we are able to predict because especially government buying is all perpetual licenses, so we are not able to clearly predict it at this point.

Sure. That's very helpful. Thank you so much and all the very best.

Thank you.

Thank you. Our next question comes from the line of Kumar Rakesh with BNP Paribas. Please go ahead.

Hi, good evening and thank you for taking my question. My first question was more of the near-term performance. In first quarter, we usually see a seasonality when there is a productivity pass -through which happens. Given there are a couple of account -specific issues which will have a full quarter impact, should we see higher than usual seasonality going into the first quarter? And also, on the deal TCV, you spoke about that there was some deflationary impact of AI as well in that. From at least near-term, should we expect the deal TCV also to remain muted, around $2 billion-odd?

Rakesh, you can assume the usual Q1 seasonality. Despite the headwinds that we had in Q4, which will continue into Q1, the mega deal ramp-up is on track. And that growth will offset the headwinds from the two client challenges that we talked about. So otherwise, you can assume a usual Q1 seasonality.

And deal TCV, the AI impact?

Yes, of course. I mean, $100 million deal would be much lesser today - maybe 80 million, just on a rough ballpark. So , deal TCV is flat. But technically, it does require at least 25%, 30% more effort to convert and get to the same number. But I also want to call out – we have lost some deals which are voluntary losses. We have walked away from some deals which will not make sense and that would have easily contributed at least $1 billion more to this number. It's only prudent to be a little bit more careful about this and spend the energy and organizational bandwidth on more reinventing for the future and enhancing our AI positioning and delivering more value to our clients using AI instead of really fighting s ome of the traditional deals where it's hyper-competitive. If it doesn't make sense, we walked out on quite a few in the last six months.

Thanks for that. The second question was more on the capability side. The infrastructure managed services work that we do for enterprise customers, do we have a scope of work with hyperscalers as well? And if yes, how does that differ from the work that we do for enterprise customers?

Yes, of course. It is different because you're managing the hyperscaler networks, the AI Factory, a lot of the operational work; all of that is different. The tools used are different. The underlying network technology is significantly different. So, it's really a similar kind of capability, but it's different technologies on which we have to work. We have invested in training and retraining a lot of our infrastructure and data center teams to drive or to really participate in the new AIDC programs. And we've also hired a lot of lateral talent because a lot of this is also very geography specific. We have been hiring a lot more lateral talent on this front in the last maybe a year or so.

Thank you. Our next question comes from the line of Vibhor Singhal from Nuvama Equities. Please go ahead.

Yes, hi. Thanks for taking my question. CVK, so my question was on the product business. You mentioned that basically there was a spillover of the last 14 days in this quarter because of which the revenue was a bit down. If I see for the full year also, our product business is down on a 4% on a YoY basis. So is the revenue that we missed in this quarter kind of a spillover we can expect to come back in Q1. And hence the next year performance for product business could look better? Or what is the trajectory that we're looking for the product business given the circumstances that we have at this point of time with the tariffs, the war, and other external factors?

Yes, I think whether these deals will come back depends on many variables. So it's too early to say and the timing of closure is unpredictable. You would have noticed this would be the first time in recent years that the total revenue growth is half a percent below the Services revenue growth. So, at the lower end, you can compute what our assumptions for the Software business have been.

Got it. And if I look at the client -specific issues that you mentioned, two in Telecom, one in Manufacturing, and one in Retail, I would assume the three of them would probably be in the ER&D part, and the Retail would be in the pure IT services part?

No, no, I mentioned the Telecom is in the discretionary spend. It's a digital business which is part of our ITBS portfolio. Manufacturing client is both engineering services and BPO; both large. Retail client is also mostly in our digital business. We were building a new platform and some of that is related to this.

Thank you. Our next question comes from the line of Rushabh Jain from Axis Capital. Please go ahead.

Hi, thanks for taking my question. CVK, you talked about 3% to 5% deflation, but that's kind of what we see anyway, even before AI. In renewal deals, we were seeing 10% to 15% cut in pricing over the life of the deal, which would translate to more or less 3% to 5%. So, it doesn't look like with AI there is anything significantly different. Would that be right?

No, I think we were always careful that this is the incremental impact. I mean, considering the traditional productivity what we normally commit – we should be now looking at an incremental kind of impact or reduction in the overall solution.

I agree. Then should we think about this then being low to mid-single digits being equivalent to high single digits given the demand or the lack of growth in the last three years and now this is the fourth year of poor demand? I mean, can we say that some of this is also due to AI, the deflation impact?

No, I would say that very little has really played out in already reported numbers. We expect this to happen in FY'27 and onwards. That's also why you'll see this guidance lower than what we had given last year. Thanks.

Ladies and gentlemen, we will take that as the last question for today. I would now like to hand the conference over to Mr. C. Vijayakumar, CEO and MD, for closing comments. Over to you, sir.

Thank you, everyone, for joining us on our earnings call for financial year FY'26 closing. I think, given the backdrop of the external environment, HCLTech has delivered good performance, dealing with all the different variables that are playing, and our b usiness remains very resilient. We continue to focus on reinventing the company to be the best AI solutions company with an engineering pedigree, on the basis of which we want to focus and reinvent. We will see differential growth rates in all the three different categories: AI disrupted, AI amplified, and AI native or Advanced AI services. We really look forward to growing our AI native services in the 25% to 30% range. And t hat will truly be the validation of how we are evolving as a company. Thank you for your support. I look forward to talking to all of you in due course. Thank you and good evening.

Thank you. On behalf of HCLTech, that concludes this conference. Thank you all for joining us. You may now disconnect your lines.