LTIMindtree Ltd. share price target

L&T; Infotech's (LTI) Q2FY21 revenue beat estimates, with 2.3% QoQ CC growth due to an uptick in the manufacturing and BFS verticals.

LTI: Resilient show in a challenging quarter. Diversified Financials: Q1FY21 Preview Expect only gold finance NBFCs to shine

LTI reported CC de-growth of 4.7% QoQ exact in line with our estimates. LTI surprised on margins expanded 71bps QoQ to 17.4% (Ple:17%, Cons: 16.8%) led by 11% QoQ SG&A;, lower travel costs & higher proportion of offshore revenue (up 170 bps QoQ). Revenue decline was led by manufacturing (-16% QoQ) & Energy (-11% QoQ). Limited exposure to travel , hospitality and retail limited the revenue decline. Management guided Q1FY21 was trough & Q2FY21 will be flat or up QoQ & recovery will happen in 2HFY21. LTI bagged one large deal and solid execution in US just a 2.2% QoQ decline in Q1. No...

L&T; Infotech's (LTI) Q1FY21 revenue was in line with estimates, with a 4.7% QoQ CC decline due to a drop in the manufacturing and energy/utilities verticals.

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...

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...

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...

L&T; Infotech (LTI) reported 4.7% QoQ CC revenue growth in Q4FY20, well ahead of estimates.

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.

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.