Brokerages have mixed views on L&T Technology Services (LTTS), reflecting a range of opinions on its growth prospects, performance, and valuation. Here’s a breakdown of their latest ratings and target prices:

  1. Macquarie:
    • Rating: Underperform
    • Target Price: ₹4,310
    • Key Takeaways: LTTS reported QoQ revenue growth of 1.7% in USD terms (1% below estimates) and 3.1% in constant currency (CC) terms. EBIT margin at 15.9% was up 80bps QoQ but down 130bps YoY and missed estimates by 21bps. FY25 revenue growth guidance of 10% includes a 2% impact from the integration of Intelliswift, acquired in November 2024.
  2. Citi:
    • Rating: Sell
    • Target Price: ₹4,435
    • Key Takeaways: Q3 revenues and EBIT were slightly better than expected. The guidance for FY25 revenue, including acquisition, is “near 10%,” while organic guidance is revised to “near 8%” from 8-10% earlier. The company reported its highest-ever large deal bookings following a weak Q2.
  3. Nomura:
    • Rating: Neutral
    • Target Price: ₹4,900
    • Key Takeaways: Strong performance at both revenue and margin levels in Q3FY25, with robust deal wins and a strong pipeline. FY25 organic revenue growth guidance was revised to 8% from 8-10%. EBIT margins are expected to improve gradually over FY26-27, with the stock currently trading at 27.8x FY27F EPS.
  4. HSBC:
    • Rating: Buy
    • Target Price: ₹6,000
    • Key Takeaways: HSBC views Q3 as a decent quarter, despite a marginal downward revision in FY25 guidance, which remains challenging. The Intelliswift integration is seen as margin-dilutive, posing a downside risk, but better-than-expected synergies could be a positive. HSBC also emphasizes LTTS’s strong ER&D capabilities and reasonable valuations.

While most brokerages acknowledge LTTS’s strengths, the outlook varies significantly, with target prices ranging from ₹4,310 to ₹6,000, highlighting differing levels of optimism about its growth trajectory.

Disclaimer: This report is for informational purposes only and should not be considered as financial advice. Please consult your financial advisor before making any investment decisions.

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