2190.80 -49.80 (-2.22%)
NSEJul 15, 2020 15:31
The 28 reports from 7 analysts offering long term price targets for Larsen & Toubro Infotech Ltd. have an average target of 1912.60. The consensus estimate represents a downside of -12.70% from the last price of 2190.80.
|Summary||Date||Stock||Broker||Price at Reco.||Target||Price at reco|
Change since reco(%)
|2020-07-03||Larsen & Toubro Info..||ICICI Securities Limited||1978.25||1978.25 (10.74%)||Buy|
ICICI Securities Limited
Margins of Tier 1 companies are expected to decline ~32-200 bps while among Tier 2 companies NIIT and TechM are expected to post a margin decline of ~161-200 bps. This is mainly due to a dip in utilisation, pricing pressure & cross currency headwind, partially offset by rupee depreciation, lower travel cost and lower general administrative cost. Among midcap, LTI, MindTree to report stable margins We expect L&T; Infotech to report stable margins led by rupee tailwind, lower travel cost and absence of one-time contribution to PM cares fund...
|2020-05-21||Larsen & Toubro Info..||BOB Capital Markets Ltd.||1786.65||2110.00||1786.65 (22.62%)||Target met||Buy|
|2020-05-21||Larsen & Toubro Info..||IDBI Capital||1784.90||1768.00||1784.90 (22.74%)||Target met||Hold|
LTI reported a strong Q4FY20. Revenue grew by 4.7% QoQ in CC beating our forecast of +1.9%. EBIT margin of 16.7%, improved 45bps QoQ, vs. our forecast of 16.2% resulting in EPS of Rs24.5, +13%/+12.2% QoQ/YoY, being a big beat to our forecast. LTI has maintained the large deal momentum in Q4FY20 with 2 deals with net-new TCV of US$113 mn (US$332 mn for FY20). As expected, LTI has guided for weakness in Q1FY21 (mid-single digit QoQ decline in revenue) and expects QoQ growth from Q2. We factor Q4FY20 beat and increase FY21/22 revenue (in US$) 1.7%/0.6% and EPS by 7.4%/6.2%. We forecast revenue (US$)/EPS CAGR of 9.4%/12.5% over FY20-22. We...
|2020-05-21||Larsen & Toubro Info..||ICICI Securities Limited||1784.90||2050.00||1784.90 (22.74%)||Target met||Buy|
ICICI Securities Limited
Near term pressure but expect FY21E to be better than peers The company is witnessing near term challenges due to the Covid-19 pandemic. LTI's exposure to the manufacturing and energy vertical, which accounts for ~28.2% of total revenues is expected to be under pressure due to lower oil prices and client specific challenges. The company believes BFSI (that is ~45% of revenues) would face challenges in Q2FY21E and Q3FY21E. In addition, pricing pressure, delay in deal ramp ups and pressure on utilisation in the near term is expected to keep revenues under pressure. As...
|2020-05-20||Larsen & Toubro Info..||Motilal Oswal||1784.90||2060.00||1784.90 (22.74%)||Target met||Buy|
20 May 2020 Strong exit growth in FY20 coupled with healthy deal wins reiterates our confidence that L&T; Infotech (LTI) could be one of the few outliers reporting revenue/earnings growth in FY21. We keep our estimates largely unchanged and expect LTI to be a key beneficiary of the accelerated digital adoption in the post COVID-19 world. In 4QFY20, revenue (USD)/EBIT (INR)/PAT increased 16%/15%/13% YoY (v/s est. For FY20, Revenue (USD) / EBIT (INR)/PAT increased by 13%/1%/0% YoY. Reported growth (4.7% QoQ, CC) was stronger than our expectations (3%). Further, growth was broad-based across geographies and verticals. While RoW (18.1% QoQ, CC) growth was lumpy partly due to the low base, core geographies reported healthy growth despite the COVID-19 impact. Growth in the top-5 (-1% QoQ, CC)/Top-10 (2% QoQ, CC) accounts was weak due to the high base in Dec19. Overall growth during Mar20 was driven by (1) addition of new clients, and (2) mining/scaling up of small accounts.
|2020-05-11||Larsen & Toubro Info..||Axis Direct||1614.20||1744.00||1614.20 (35.72%)||Target met||Buy|
LTI is a global technology consulting and digital solutions company helping more than 420 clients succeed in a converging world, with operations in 32 countries. LTI helps clients in digital transformation with LTIs Mosaic platform enabling clients mobile, Analytics, IoT and cloud journeys.
|2020-01-21||Larsen & Toubro Info..||Axis Direct||1908.75||2140.00||1908.75 (14.78%)||-2.32||Buy|
LTI posted strong revenue growth of 8.3% on QoQ basis and 14.2% on YoY basis in constant currency (CC) terms for the period of Q3FY20 at Rs.2, 811crs. Operating margins in Q3FY20 stood at 18.8% improved by 70 bps on QoQ basis owing to tailwinds like better service mix, improved utilization.
|2020-01-20||Larsen & Toubro Info..||Axis Direct||1895.90||2140.00||1895.90 (15.55%)||-2.32||Buy|
|2020-01-16||Larsen & Toubro Info..||ICICI Securities Limited||1902.35||2150.00||1902.35 (15.16%)||-1.86||Hold|
ICICI Securities Limited
The company's strategy of adding new logos, winning large deals and client mining is reflected in the current quarter results. Apart from a revival in spending at top client, growth in BFS segment (up 11.1% QoQ) was driven by large deal win in Nordics. Further, the company's manufacturing, retail and Hitech grew 15.7% QoQ, 5.8% QoQ and 8.8% QoQ representing LTI's strong execution and ability to gain market share across verticals. The company's US$50 million+ clients has increased by one and US$20 mn and US$50 mn has increased by three each representing strong client mining...
|2020-01-16||Larsen & Toubro Info..||IDBI Capital||1901.60||2125.00||1901.60 (15.21%)||-3.00||Buy|
LTI reported a strong Q3FY20. Revenue grew by 8.3% QoQ in CC beating our street-high forecast of +5.7%. EBIT margin of 16.2%, improved 70bps QoQ vs. our forecast of 16.5% and EPS of Rs21.7, grew by 4.7%/0.1% QoQ/YoY. Digital solutions (41% of revenue) continued to lead the growth momentum and grew by 10.4%/26% QoQ/YoY in US$. LTI maintained the large deal momentum and has secured 2 large deals with net new TCV of US$75 mn+ in Q3FY20 (US$219 mn+ YTD). We finetune our FY20/21 forecast and introduce FY22 financials. We forecast revenue (US$)/EPS CAGR of 14.9%/17.1% over FY20-22. We rollover to FY22E and increase our...
|2020-01-15||Larsen & Toubro Info..||HDFC Securities||1901.60||2090.00||1901.60 (15.21%)||Target met||Buy|
Maintain our conviction on LTI based on (1) Broad-based vertical presence (sub-vertical strategy) with marquee ac, (2) Strong client mining programs and expanding deal pipeline (ramp-up schedule on track), (3) Improving alliance network/talent augmentation, and (4) Leading operational metrics vs. peers. Growth momentum (YoY) to be intact, supported by strong (sustainable) performance by large account (beneficiary in vendor consolidation). Expect USD rev/EPS CAGR of 14/12% over FY19-22E. LTI's pedigree coupled with growth momentum will continue to support its premium valuations. We maintain BUY on L&T; Infotech (LTI) following rev beat/in-line margin performance and ~7% EPS increase. Broad-based growth drivers and strong uptick in large account provide growth visibility. Our TP of Rs 2,090 is based on 18x Dec-21E EPS.
|2020-01-15||Larsen & Toubro Info..||Motilal Oswal||1933.60||1933.60 (13.30%)||Neutral|
As mix incrementally shifts toward annuity revenue, we see headroom for further (i) utilization improvement, (ii) pyramid correction and (iii) reduction in sales intensity. In that context, the shift in business mix toward more of manage services should translate into headroom for (1) utilization improvement, (2) pyramid correction and (3) reduction in sales intensity. Pyramid correction and utilization improvement should be the key margin levers on the cost side, while right pricing for right services would be the key lever on the revenue front. Employee + sub- con expenses accounted for 71% of revenue v/s 66% for LTI (last three year In that context, the shift of business mix toward more of annuity revenue should translate into headroom for (i) utilization improvement, (ii) pyramid correction and (iii) reduction in sales intensity. However, the impact of this should be offset by correction in high yields (MTCL has 9%-10% higher revenue per utilized tech emp v/s LTI).
|2019-12-16||Larsen & Toubro Info..||Axis Direct||1639.80||1800.00||1639.80 (33.60%)||Target met||Buy|
|2019-12-12||Larsen & Toubro Info..||Prabhudas Lilladhar||1640.15||1825.00||1640.15 (33.57%)||Target met||Accumulate|
& how they are well positioned to capture digital opportunities in transforming the core. The CEO mentioned that Enterprises need to master four essential plays to excel ahead 1) Digitizing the core 2) Data Driven Organization, 3) Experience transformation & 4) Operate to transform. Customer centricity remains a key aspect of LTI strategy. LTI sales & marketing initiatives are driving strong growth for the company. LTI has laid out sales strategy framework three years ago & it focusses mainly on large deal wins, growing top accounts & focusing on strategic alliances. It...
|2019-12-12||Larsen & Toubro Info..||ICICI Securities Limited||1640.15||1880.00||1640.15 (33.57%)||Target met||Buy|
ICICI Securities Limited
The company continues to focus on an outcome based approach by digitising the core, building a data driven organisation, transforming experience and operating to transform taking centre stage. LTI continues to make investments in this direction led by a strong sales team driving large deals and expertise in niche capabilities in the revenue segments. This is bearing fruit in terms of strong growth in non-top 20 accounts, improving large deal pipeline, strategic alliances with top companies and revenue CQGR of 3.3% (over Q1FY16-Q2FY20). This, along with maintaining PAT...
|2019-12-12||Larsen & Toubro Info..||BOB Capital Markets Ltd.||1640.15||2010.00||1640.15 (33.57%)||Target met||Buy|
|2019-12-11||Larsen & Toubro Info..||Motilal Oswal||1630.75||2030.00||1630.75 (34.34%)||Target met||Buy|
11 December 2019 LTI hinted at ~30% improvement in the customer experience index and a strong increase in employee morale. While continuing with the current strategy, it productisation of services, (iii) people and (iv) capabilities. While productisation of services has been a strategy emphasized by a few larger competitors, we understand that the results so far have been mixed. Large/overall deal pipeline is stronger than a year ago by 20%/42%. New logos now comprise 60%/35% of the large/overall deal pipeline (v/s 32%/19% a year ago). However, the share of new-age deals in the pipeline has moderated to 37% (v/s 43% a year ago). We note that 67%/49% of the large/overall deal pipeline is in the proposal stage. LTI indicated that reskilling of ~50% of workforce was completed over the last strengthening through platforms (e.g. Temenos PFS, Private Eye), (ii) building new (e.g. AI, ML), (iii) modernizing traditional (e.g.
|2019-12-04||Larsen & Toubro Info..||Motilal Oswal||1643.55||2030.00||1643.55 (33.30%)||Target met||Buy|
In addition, (1) marquee client connects, (2) sales driven by multiple units (e.g. alliances, customer success, large deal teams), (3) strong focus/expertise in a few segments (e.g. CIB and WM in BFSI), (4) optimal scale and (5) a high quality management team remain the key competitive advantages of the company. Over 9MCY19, LTI has witnessed deceleration in growth (~9pp YoY) and drop in utilization (~300bp) due to issues faced at three of its key clients. While client specific issues seem to be largely behind, the key question is whether growth and margins will bounce back in a cautious spending environment. The recent large deal wins hint at growth accelerating over the next 12-18 months. L&T; Infotech It is interesting to note that during the previous cycle of cautious IT spending (Jun16 to Dec17), LTI consistently outperformed growth of Tier-I companies and that too by a wide margin (1-11pp YoY).
|2019-11-04||Larsen & Toubro Info..||Axis Direct||1659.30||1800.00||1659.30 (32.03%)||Target met||Hold|
L&T; Infotech Ltd. (LTI) reported sturdy results in terms of top line in Q2FY20. LTI posted strong revenue growth of 2.4% on QoQ basis and 11.9% on YoY basis in constant currency (CC) terms for the period of Q2FY20 at Rs.2, 570 crs.
|2019-10-19||Larsen & Toubro Info..||HDFC Securities||1610.60||1845.00||1610.60 (36.02%)||Target met||Buy|
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.