We have Buy coverage on L&T Technology Services Limited with a target price of Rs 1,940 per share, says a report by Anand Rathi.
Larsen & Toubro Technology provides design and development solutions to clients across the entire value chain of product development.
These includes solutions in the areas of mechanical and manufacturing engineering, embedded systems, software engineering and process engineering.
For new-age technologies, it provides services and solutions in the areas of product lifecycle management, engineering analytics, power electronics, M2M connectivity and IoT.
With the rise of enabling technologies like 5G, IoT, Artificial Intelligence etc, the digital disruption now has expanded to almost each and every part of the global industrial complex including manufacturing and process industries. This has opened a new and bigger opportunity of more than $1.1 trillion market for engineering outsourcing market.
LTTS’ has multi-sectoral presence and domain expertise enables cross-pollination of ideas and best practices leading to differentiated engineering solutions.
During the latest quarterly results, the company has reported robust growth in revenues; it grew 33.2% in Q1-FY19 to $168.9 million as against $127.6 million in Q1-FY18 in constant currency terms.
We expect LTTS to grow its consolidated revenues at CAGR of 23% for the next two years and reach Rs 4895 Cr in FY19 and Rs 5696 Cr in FY-20 on back of large opportunity present across capex intensive business and sustained momentum of ramping up of existing clients
At CMP the stock is trading at 2x times FY18E consolidated earnings and 16.9x times FY19E consolidated earnings.
We have Buy coverage on L&T Technology Services Limited with a target price of Rs 1,940 per share (32.88x FY19e EPS of 59).Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are their own, and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.