LTIMindtree Ltd. share price target

We interacted with LTIMindtree’s management to understand the company’s business strategy and growth prospects. For Q1FY26, LTIMindtree expects strong order inflow to continue, bolstered by a landmark $450 million, seven-year deal, following robust order inflows of $1.68 billion in Q3FY25 and $1.6 billion in Q4FY25.

LTIM reported muted performance with revenue growth down 0.6%/0.7% CC/USD QoQ, underperforming I-Sec estimates. Factors leading to slower growth were, Delayed ramp-up and deferral of deals, Ramp-down in healthcare vertical and Top-5 clients’ revenue declining from AI-led gain sharing.

The revenue growth (-0.6% QoQ CC) was below our estimates (+0.3% QoQ CC), while margins were fairly in line, attributed to project closures and unanticipated delays in deal ramp ups. The new management is doubling down on three key initiatives to maximize revenues and improve profitability. The management expects new initiatives to start reaping benefits from Q1FY26, it expects Q1 to be a growth quarter with sequential improvement in margins. Despite having 34% dependency on tariff sensitive verticals (Manufacturing...

Reported revenues stood at $1,131 million, down 0.6% q-o-q/ 6.3% y-o-y in CC missing our estimates of 0.2% q-o-q growth in CC. Rupee revenues stood at Rs 9,772 crore, up 1.1% q-o-q/9.9% y-o-y.

LTIMindtree (LTIM) reported 4QFY25 revenue of USD1.1b, down 0.6% QoQ CC and below our estimate of flat QoQ CC. FY25 revenue stood at USD4.5b, up 5.0% YoY CC. 4Q EBIT margin at 13.8% was in line with our estimate of 13.8%.

While 3QFY25 was decent on revenue, ability to counter the wage hike impact was missing resulting in a 170bps EBIT margin drop QoQ

LTIM reported a mixed performance in Q3FY25; revenue growth of 1.8% QoQ CC was in line with our estimate, while EBITM of 13.8% fell slightly short of our expectations.

LTIMindtree (LTIM) delivered revenue growth of 1.8% QoQ/5.6% YoY in constant currency (CC) terms vs. our estimate of +1.5% QoQ in CC. In USD terms, revenue came in at USD1.1b (up 1.1% QoQ/5.1% YoY).

We maintain BUY rating with unchanged PT of Rs 7,500. At the CMP, the stock trades at 35.6/29.3/24.5x its FY25/26/27E EPS.

At its analyst meet, LTIMindtree (LTIM) highlighted the proliferation of AI across the value chain and the company’s readiness to capitalize on this new opportunity.

We attended LTIM’s Investor Day 2024, where the management spelt out its aspiration of achieving a revenue of USD10b and EBIT margin of 17-18%.

Softer than expected but broad-based growth. TCV numbers have been in a narrow range for many quarters now.

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