LTIMindtree Ltd. share price target

Recommendation: Given the company's strong growth potential backed by robust deal wins and superior execution capabilities, we recommend a HOLD rating on the stock.

LTIMindtree reported weak results for a second quarter in a row – revenue
declined 1.3% QoQ (-1.3% cc) compared with our estimate of a 0.5% dip.
Revenue growth was impacted by continued softness in discretionary spending
and cancellation of a couple of projects in BFSI.

Reported revenue stood at $1069.4 million, down 1.3% q-o-q/ up 1.2% y-o-y, respectively in constant currency (CC) terms, weaker than our estimates of a 0.6% q-o-q decline in CC driven by weakness in Manufacturing and BFSI.

Recommendation: Given the company's strong growth potential backed by robust deal wins and superior execution capabilities, we recommend a HOLD rating on the stock.

LTIMindtree reported revenue growth at 1.6% QoQ USD, tad below our/street’s growth estimate of 1.9%/1.7%. Growth was driven by manufacturing (5.2% QoQ USD), retail and travel (3% QoQ USD), healthcare (3% QoQ USD) and hi-tech (1.9% QoQ USD). BFSI dipped 1.1% QoQ USD. EBIT margin was at 16%, down 70bps QoQ and ahead of our/street’s 15.1%/15.7% estimates, as a 200bps impact from wage hike was offset by improvement in utilisation, operational efficiencies and absence of visa costs. LTIM reported healthy bookings of USD 1.3bn (20% YoY/-8% QoQ).