Neutral Larsen and Toubro Technology; target of Rs 4400: Motilal Oswal

Motilal Oswal's research report on Larsen and Toubro Technology

L&T Technology (LTTS)’s 4QFY25 revenue was up 10.6% QoQ/13.1% YoY in USD terms vs. our estimate of ~14.6% QoQ growth. In CC terms, revenue was up 10.5% QoQ/14.2% YoY. Growth was led by Hi-Tech (up by 27.9% QoQ) and Sustainability (up 1.9% QoQ), while Mobility was flat QoQ. EBIT margin stood at 13.2% vs. our estimate of 15%. Adj. PAT stood at INR3.0b (est. INR3.8b), down 2.3% QoQ/9.3% YoY. For FY25, revenue grew 10.6%, but EBIT/PAT declined 3.7%/3.4% YoY in INR terms.

Outlook

We expect revenue/EBIT/PAT to grow by 18.6%/6.5%/8.1% in 1QFY26 YoY. We reiterate our Neutral rating on the stock with a revised TP of INR4,400 (based on 27x FY27E EPS).