HCLTs payout ratio has consistently improved to ~53% in FY18 from ~20% in FY13. In FY18, the combination of dividend and buyback (INR160b) led to a payout of 53% of PAT. While it paid out INR35b in the form of buyback, it also paid out a dividend of INR8 per share. While the buyback would take the ratio to 40% on our FY19 PAT estimate, we expect a dividend of INR10 per share for the year. Since the last year, TCS, INFO, WPRO and HCLT have all announced buybacks. While we believe the case for valuation uptick would depend on the positioning in Digital and the financial performance, an upshift in dividend payout, and the consequent yield return and improved return ratios together bode well in keeping valuations buoyant. We maintain IBM deals and/or [2] turnaround in core areas of Application Services and IMS.