No management rejig on cards, says HCL Tech

HCL Tech BSE | NSE 20/06/12

HCL Technologies on Tuesday denied reports that there was any management rejig on the cards and said Vineet Nayar would remain the vice chairman and chief executive of the company.

A report in Times of India newspaper had claimed on Monday that the Shiv Nadar promoted software services provider was heading for a management reshuffle. Nayar is on his way out and Anant Gupta, currently president of infrastructure services will replace, the report had said citing an unnamed company official. Apart from Nayar the report had also claimed that several other senior officials close to Nayar were also quitting.

However, HCL Tech says

the reports are only rumours and speculations.

"As a onetime exception to our stated policy of not responding to speculations and rumors, HCL Technologies confirms that Vineet Nayar is and will continue to be the Vice Chairman and CEO of the Company and there is no change in the same," it said in a notice to stock exchanges.

Nayar had sold 27 lakh equity shares of Rs 2 each of HCL Tech amounting to 0.39% stake on June 7 to raise about Rs 134 crore, fuelling the rumours of a management rejig according to some analysts.

Separately, in a report dated June 10, Morgan Stanley analysts Vipin Khare and Gaurav Rateria had said they believed some changes in management responsibilities could be announced when HCL Tech announces annual results around July-August. HCL Tech follows July-June financial year.

"In our view, Anant Gupta of Infrastructure is likely to take a bigger role in the day-to-day operations at HCL Tech and CEO Vineet Nayar may be delegating some of his key responsibilities to Gupta. Reporting lines for some key managers reporting to Nayar appear to have changed recently. We also believe that Mr. Nayar may not be as active in reviewing business plans for the coming year as he has been in the past," the two analysts had said.

Morgan Stanley has an "overweight" rating on the stock.

HCL Tech shares rose 0.7% to Rs 472.95 on NSE in afternoon trade. The stock is down near 6% since the company announced Nair's stake sale to the exchanges on June 8. The wider CNX-IT index is up 1% during the same period.

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