Shares of LTIMindtree Ltd fell 4% after reports emerged that Citigroup plans to reduce its dependence on external IT vendors from 50% to 20% by the end of 2025. This move is part of Citigroup’s broader strategy to strengthen its internal tech capabilities, increasing its internal IT staff to 50,000 from 48,000 in 2024.
The decision comes amid regulatory concerns over data governance and risk management. In 2024, Citigroup was slapped with a $136 million fine for deficiencies in data governance, alongside a $22.9 million fraud incident.
Citigroup is one of LTIMindtree’s top two clients, making this development a significant factor impacting LTIM’s stock. Investors are closely watching the situation, as a decline in Citigroup’s IT outsourcing could lead to a revenue impact for LTIMindtree.
Citibank is also a key client for TCS, Infosys, and Wipro, making its ongoing restructuring a concern for multiple Indian IT firms. In a note, Jefferies highlighted that Citibank’s cost-cutting measures could pose growth risks, particularly for LTIMindtree, which counts Citi among its top two clients, contributing over $100 million in revenue. As Citibank aims to streamline its IT services budget, there is potential for reduced outsourcing, which could impact multiple Indian IT firms. However, Jefferies suggested that LTIMindtree faces a higher risk of losing wallet share compared to its competitors, especially amid leadership changes.
Further underscoring concerns about integration challenges, Jefferies pointed to the recent resignation of CFO Vinit Teredesai, indicating that the company may still be struggling post-merger. The note mentioned that several senior executives have exited in the last 3-6 months, raising concerns about LTIMindtree’s stability. The board has since appointed Vipul Chandra as the new CFO.
Over the past year, LTIMindtree has seen around 18 top-level exits, including CXOs such as CTO, CFO, CBO, and CMO. Reports indicate that the company is currently grooming two internal candidates—Sudhir Chaturvedi (President & Executive Board Member) and Nachiket Deshpande (COO)—as potential successors for the CEO role.
Stock Performance
- Previous Close: ₹4,467.05
- Day’s Range: ₹4,239.00 – ₹4,445.00
- 52-Week Range: ₹4,239.00 – ₹6,767.95
- Market Cap: ₹1.73 trillion
- Average Volume: 324.04K
Also, LTIMindtree has also announced a key leadership change, appointing Nachiket Deshpande as the President of AI Services under the newly appointed CEO Venu Lambu. Deshpande, who previously served as the Chief Operating Officer (COO) and was also a frontrunner for the CEO role, will now lead the company’s AI business group, deal-making, M&A strategies, R&D, and ecosystem partnerships. According to his LinkedIn profile, he will be based in New York as he takes on this crucial role. The COO position at LTIMindtree may be phased out, similar to trends observed in Infosys and TCS. In an internal letter dated March 7, Lambu emphasized the growing convergence of software and services in the AI-driven market, urging a strategic shift to capitalize on new AI-driven opportunities.
Disclaimer: The information provided is for informational purposes only and should not be considered financial or investment advice. Stock market investments are subject to market risks. Always conduct your own research or consult a financial advisor before making investment decisions. The author or Business Upturn is not liable for any losses arising from the use of this information.
