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HCL TechnologiesNSE:HCLTECH -0.43%83 Gross Margin % is 40.59% as of Jun. 2026, which is 14% below its 10-year median of 47.20. GuruFocus rates NSE:HCLTECH with a GF Score™ of 83/100 and a GF Value™ of ₹1,813.64 (Modestly Undervalued). The stock has 3 warning signs investors should review. Among 2,690 Software companies, HCL Technologies ranks better than 50.63% on this metric.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
HCL Technologies had a gross margin of 40.59% for the quarter that ended in Jun. 2026 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
HCL Technologies Gross Margin % Related Terms
HCL Technologies Gross Margin % Historical Data
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The historical data trend for HCL Technologies's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
NSE:HCLTECH vs IBM, ACN, FISV: Gross Margin % Comparison
For the Information Technology Services subindustry, HCL Technologies's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
HCL Technologies Gross Margin % vs Software Industry
For the Software industry and Technology sector, HCL Technologies's Gross Margin % distribution charts can be found below:
* The bar in red indicates where HCL Technologies's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
HCL Technologies (NSE:HCLTECH) has a Gross Margin % of 40.59% as of Jun. 2026. Gross margin is the ratio of total gross profit to net sales. View historical data on HCL Technologies and its competitors. This is 14% below median its historical median of 47.20. Over the past decade, HCL Technologies' Gross Margin % has ranged from 41.07 to 49.67. According to the industry distribution chart, HCL Technologies ranks #1328 out of 2690 companies in the Software industry, placing it in the top 49.4%.
Is HCL Technologies' Gross Margin % too high?
HCL Technologies' current Gross Margin % of 40.59% is 14% below median its 10-year median of 47.20. Over the past 10 years, this metric has ranged from a low of 41.07 to a high of 49.67. The Software industry median Gross Margin % is 40.50. HCL Technologies' value of 40.59% is 0.2% above this industry median. Based on the distribution chart, HCL Technologies ranks #1328 out of 2690 companies in the Software industry, which is above the industry midpoint. Overall, HCL Technologies has a GF Score™ of 83/100 and is considered Modestly Undervalued, reflecting its overall financial health beyond just this single metric.
How does HCL Technologies' Gross Margin % compare to IBM and ACN?
According to the Software industry distribution chart, HCL Technologies ranks #1328 out of 2690 companies for Gross Margin %. This puts HCL Technologies in the upper half of its industry. The industry median Gross Margin % is 40.50. HCL Technologies' value of 40.59% is 0.2% above this benchmark. Historically, HCL Technologies' own Gross Margin % has ranged from 41.07 to 49.67 over the past decade. While the company's 10-year median is 47.20 vs. the industry median of 40.50, HCL Technologies has consistently been above the industry average. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Gross Margin % for a Software company?
The median Gross Margin % among Software companies is 40.50, based on 2,690 companies in the industry. Companies in the top quartile (top 25%) have a Gross Margin % significantly above this median, while those in the bottom quartile fall well below. However, Gross Margin % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. HCL Technologies's current Gross Margin % of 40.59% is 0.2% above the industry median. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Gross Margin % mean?
A high Gross Margin % can signal that a stock is expensive relative to its fundamentals. Gross margin is the ratio of total gross profit to net sales. View historical data on HCL Technologies and its competitors. For the Software industry, the median Gross Margin % is 40.50 — values significantly above this may indicate overvaluation, while values below may suggest a bargain or underlying issues. HCL Technologies's current Gross Margin % is 40.59%, which is 14% below median its own 10-year median of 47.20. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is HCL Technologies stock overvalued right now?
Based on GuruFocus' analysis, HCL Technologies (NSE:HCLTECH) is currently considered Modestly Undervalued. The stock's GF Value™ is ₹1,813.64, compared to a current price of ₹1,346.90 — trading 25.7% below its estimated fair value. The current Gross Margin % is 40.59%, which is 14% below median its 10-year median of 47.20 and 0.2% above the Software industry median of 40.50. HCL Technologies' overall GF Score™ is 83/100 with 3 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Gross Margin % calculated?
Gross Margin % is calculated from a company's financial statements. For HCL Technologies (NSE:HCLTECH), the current Gross Margin % is 40.59% as of Jun. 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is HCL Technologies (NSE:HCLTECH) Overvalued in 2026?
Based on GuruFocus' analysis, HCL Technologies stock appears to be undervalued.
The current stock price of ₹1,346.90 is trading 25.7% below its estimated GF Value™ of ₹1,813.64.
GuruFocus considers HCL Technologies to be Modestly Undervalued.
Key valuation signals for NSE:HCLTECH:
Gross Margin %: 40.59% (14% below median its 10-year median of 47.20)
GF Value™: ₹1,813.64 vs. price of ₹1,346.90 (25.7% below fair value)
Industry Position: 0.2% above the Software median (#1328 of 2690)
No single metric tells the full story. See the NSE:HCLTECH stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
HCL Technologies Ltd provides enterprises with IT solutions. It focuses on offering Digital, Internet of Things, Cloud, Automation, Cybersecurity, Infrastructure Management, and Engineering services to solve business problems for clients. It offers solutions to a variety of industries, including Financial Services, Public Services, Consumer Services, Healthcare, and Manufacturing. It operates in three segments: IT and Business Services, Engineering and R&D Services, and HCL Software. The firm emphasizes consultation services for firms, intending to offer them digital and design solutions. The majority of the firm's revenue comes from the IT and Business Services segment. Geographically, it derives maximum revenue from the USA, and the rest from Europe, India, and the Rest of the world.
83GF Score
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