HCL Technologies Soars 3% After Securing Major Deal with Germany’s apoBank

HCL Technologies’ stock jumped nearly 3% in early trading on Wednesday after the IT giant announced an expanded partnership with Deutsche Apotheker- und Ärztebank eG (apoBank), Germany’s largest cooperative primary bank. HCL Tech’s shares rose as high as 2.95%, reaching ₹1,472 each on the BSE.

The new deal will see HCL Technologies provide apoBank with managed services that ensure resilient, scalable, high-quality, and compliant digital foundation services. This will help apoBank offer fast and secure banking services to its customers, according to a regulatory filing by HCL Tech.

The total value of this contract is estimated at $278 million over 7.5 years, which translates to an annual contract value of $37 million.

apoBank has been a client of HCL Tech since 2021, starting with a partnership in application services.

“The new contract will significantly expand our relationship. We look forward to helping apoBank serve their customers better by leveraging our comprehensive managed infrastructure and cloud services, as well as our deep experience with Avaloq,” said Sudip Lahiri, Executive Vice President and Head of Financial Services, Europe, HCL Technologies.

HCL Tech is a strategic partner of Avaloq, a leading provider of banking technology and services, with strong expertise in Avaloq’s core banking system. In 2022, HCL Tech acquired Confinale, a Swiss digital banking and wealth management consulting specialist and Avaloq implementation partner.

Brokerage firm Morgan Stanley noted that this deal highlights HCL Tech’s momentum in securing large deals within the financial services sector and significantly expanding existing client relationships. They believe such deals support HCL Tech’s ability to meet its full-year revenue targets.

Morgan Stanley has maintained an ‘Overweight’ rating on HCL Tech shares, with a target price of ₹1,650 each.

As of 9:30 am, HCL Tech shares were trading 1.57% higher at ₹1,452.20 on the BSE.