Dear Arpita,
You need to know as to the reason the Hike has been asked?
Have you hired her on a low salary then her other team mates with the same experience? Had she been promised an hike in the salary at the time of interview?
Also if the above are negative, then you need to explain the candidate the increment policy, and also how the performance is calculated in your company.
Also speak with the department, if the increment is justified based upon her performance and have they promised her anything.
Lastly, be ready with backups for the candidate, as she may leave the company if the answer is not in her favour.
Regards,
Ashutosh Thakre