Three prominent brokerages, Investec, Nomura, and Morgan Stanley, have shared their perspectives on LTIMindtree following its Q2 FY25 results, presenting a mixed outlook for the company.
Investec: Maintain sell, target price hiked to Rs 5,600
Investec continues to maintain its ‘Sell’ rating on LTIMindtree but has slightly raised its target price to Rs 5,600 from Rs 5,370. The brokerage noted that while the quarter was largely in line with expectations, it forecasts a weaker performance in the second half of FY25. Revenue growth has been broad-based across various verticals, but Investec highlights that recent stock rerating has not been accompanied by commensurate operational outperformance.
Nomura: Downgrade to reduce, target price set at Rs 5,140
Nomura has downgraded its outlook on LTIMindtree to ‘Reduce,’ lowering the target price to Rs 5,140. While Q2 FY25 saw a modest miss on revenue, there was a slight beat on margins. The brokerage pointed out that near-term growth visibility is largely driven by short-cycle projects from clients, but it expects margin recovery to be slow, with significant improvement contingent on a sharp revival in growth. Nomura has also reduced its FY25-27 EPS estimates by 3-5%.
Morgan Stanley: Overweight, target price of Rs 7,050
In contrast, Morgan Stanley remains bullish on LTIMindtree, reiterating its ‘Overweight’ stance with a target price of Rs 7,050. Although there were no significant positive surprises in Q2 and the commentary for Q3 was softer than expected, Morgan Stanley sees the broader recovery trends as intact. The brokerage cited sustained BFSI momentum, a large deal pipeline, and robust headcount additions as positive indicators for future growth. It views any near-term stock weakness as a buying opportunity to accumulate more shares.
With a current market price of Rs 6,408, LTIMindtree presents a mixed investment case, as brokerages remain divided on its near-term prospects. While Morgan Stanley is optimistic about the company’s long-term trajectory, Investec and Nomura express concerns over the company’s near-term revenue growth and margin recovery.
Disclaimer: The information provided in this article is for informational purposes only and should not be construed as investment advice. Please seek independent financial advice before making any investment decisions.
