A case of ransomware was recorded on Wednesday, 20th December, 2023, when HCLTech reported that it had encountered a cyber attack in an isolated cloud environment on one of its projects. Officials stated that investigations are underway and that this occurrence hasn’t created any major effect on HCLTech’s all over network, further adding “cybersecurity and data protection is a top priority for HCLTech.”
HCL Technologies or HCLTech (originally known as Hindustan Computers Pvt. Limited) is an Indian multinational information technology corporation headquartered in Noida, Uttar Pradesh. It was founded by Shiv Nadar, which rose to fame in 1991 when HCL entered into the arena of software services business. The ransomware incident took place days after HCL crossed market capitalization of Rs. 4 trillion on the Indian trading markets, making it the 13th largest listed company amongst other businesses from the IT sector.
The occurrence of this event, although not much serious, however, has raised serious questions on Computer security and data protection. This calls for the need for better practices to ensure protection of computer systems. Antiviruses are some obvious examples to necessitate protection, but other steps need attention too. These may include data backup, patch management, application whitelisting and control, etc.
In response to the news, HCLTech’s shares dropped 3.38% to ₹1,437 per on the National Stock Exchange (NSE) on Wednesday. The disclosure about the ransomware was made before the markets opened for trading in the morning, which subsequently led to the downfall of HCL’s stocks that day. The NSE Nifty 50 as a whole fell 1.4%.
Compared to ₹3,489 crore in the same quarter of the previous fiscal year, HCL Technologies’ total profit increased 9.8% from the previous year to ₹3,832 crore for the quarter that ended in September. The computer technology firm’s overall revenue increased by 8% year over year to ₹26,672 crore from ₹24,686 in the same period last year. Earlier in a post earnings press conference held in October, CEO and tech managing director C Vijayakumar had said “ The environment is quite volatile. So it’s quite difficult to take a call from a long term perspective. We are focused on executing this financial year.”
Talking about this uninitiated event which has been a matter of concern, this attack came at a time when the Information Technology sector has been facing persistent macro-economic turmoils affecting the purchase of technology. HCLTech revealed in the last few weeks the launch of an additional distribution center in the country of Romania, an extension of a five-year partnership with the Swedish business Husqvarna Group, and an agreement with Victoria, Australia’s Division of Transport and Planning. Furthermore, State Street Corporation, a UK business partner, parted ways with the company by purchasing HCLTech’s part for $170 million.
Owing to computer and information technology, HCL has been leading at the forefront in the industry. In the second quarter of the fiscal year 2024, it recorded a yearly revenue growth of 8% and sustained good strong margins. Because of the significant deals made during the quarter, higher profitability is also anticipated to be reported. In the second quarter of the fiscal year, HCLTech cracked a total number of 16 deals, out of which 7 were in the services domain and 6 belonged to the software domain. On the contrary, the first quarter wasn’t a good period as compared to the strong second quarter.
On the business side, HCL has been performing quite well with its services. Reflecting upon the workforce, the percentage of employed people decreased by 1% on a sequential basis, with a reduction in 2,299 employees. The information technology firm reduced its dependence on external suppliers substantially.