Larsen & Toubro Infotech Ltd.    
19 Oct 2019, 09:01AM
1728.40
2.07%
HDFC Securities
LTI's strong pedigree is reflected in its (1) Broad-based vertical presence (and sub-vertical strategy) with marquee accounts, (2) Strong client mining programs and large deal portfolio, and (3) Leading margin/return metrics vs. peers. Client specific challenges (in BFS and Hi-tech) have probably troughed and large deal trajectory is expected to improve growth momentum hereon. Our revenue/EPS CAGR over FY19-22E is ~10/8%. The stock is not inexpensive at 16.9x FY21E, but we believe LTI has the pedigree to command higher valuations as earnings growth becomes more visible. We maintain BUY on L&T; Infotech (LTI) following an in-line rev/margin performance and unchanged est. Large deal wins, deal ramps and reduction in client-specific challenges provide growth visibility (2H acceleration). Our TP of Rs 1,845 is based on 18x Sep-21E EPS.
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Larsen & Toubro Info.. has an average target of 1867.00 from 8 brokers.
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