L&T Technology Services share price fell 7 percent in the early trade on January 19 - a day after the company reported its December quarter earnings.
L&T Technology Services has reported an 8 percent increase in net profit to Rs 248.8 crore for the quarter ended December 2021 as against Rs 230 crore in the last quarter.
The rupee revenue was up 5 percent at Rs 1,687.5 crore from Rs 1,607.7 crore, QoQ, while the dollar revenue stood at $225.1 million against $217.4 million.
Its earnings before interest and tax (EBIT) was up 6 percent at Rs 314.4 crore from Rs 296.4 crore and margin was up at 18.6 percent as against 18.4 percent, QoQ.
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Here is what brokerages have to say about the stock and the company post December quarter earnings:
Citi
Research house Citi has kept a 'sell' call on L&T Technology Services with a target at Rs 4,430 with soft Q3 with revenue below expectations and margin was ahead.
The growth largely impacted due to lower number of working days. The attrition is likely to stabilise from Q4 as per management. Citi has revised FY22-FY24 EPS marginally by 0-2 percent.
CLSA
CLSA has maintained 'outperform' rating on the stock with a target at Rs 6,150 after steady revenue growth, improved execution and a healthy outlook.
The commentary on its medium-term growth outlook is healthy. The valuation is rich and may remain elevated given demand upcycle.
Sharekhan
L&T Technology Services is well-placed to gain market share among global competitors because of being the preferred engineering partner among clients, strong customer-centric approach and a full-service model.
We believe the company is on track to achieve its revenue growth aspiration with a good profitability. We expect LTTS’ USD revenue and earnings to post a CAGR of 19 percent and 25 percent over FY2022-24. We retain a 'buy' on the stock with a revised price target of Rs 6,350.
Motilal Oswal
Digitisation is driving accelerated spends in ER&D and company should benefit from it due to: (1) its strong capabilities, (2) multi-vertical presence, and (3) solid wallet share.
We expect the company to deliver strong revenue growth over the coming years and retain it as our top pick in the Tier-II IT Services space.
Our target price of Rs 6,130 per share implies 43x FY24 EPS. We anticipate improved industry spends compared to the preceding five years. We maintain our 'buy' rating.
At 9:17am, L&T Technology Services was quoting at Rs 5,070.00, down Rs 351.45, or 6.48 percent, on the BSE.
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