Prabhudas Lilladher's research report on LTIMindtree
LTIM reported revenue of USD1.07b, down 1.3% QoQ in CC and reported terms, below consensus of 0.9% CC decline. The decline was led by project cancellations within BFS verticals, where the clients have reprioritized their spends. Otherwise the growth was broad-based across verticals, while Mfg growth tapered off (down ~10% QoQ) over 3Q high base. The margin impact was meaningful, down 70bps QoQ (vs consensus of flat QoQ). The margin decline had a one-off impact (~80 bps QoQ) of project cancellations, which should reverse in Q1, as the talents are already been repurposed to drive other projects.
Outlook
The stock is currently trading at 24x FY26e, we are assigning P/E of 25x to FY26e with a target price of INR 5,015. With that we assume coverage on LTIMindtree with an “ACCUMULATE” rating.
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