NDTV Profit's special research section collates quality and in-depth equity and economy research reports from across India's top brokerages, asset managers and research agencies. These reports offer NDTV Profit's subscribers an opportunity to expand their understanding of companies, sectors and the economy.
Axis Securities Report
In Q3 FY24, LTIMindtree Ltd. reported revenue of Rs 9,017 crore, up 1.2% QoQ (0.7% QoQ in constant currency terms). This was slightly below our expectations.
The company's operating profit stood at Rs 1,386 crore, reporting a decline of 2.6% on a QoQ basis. This was largely on account of lower overall demand in the majority of its operating regions. Its net profit for Q3 FY24 stood at Rs 1,169 crore, registering a growth of 0.6% QoQ.
Outlook
From a long-term perspective, we believe LTIMindtree is well-placed to deliver encouraging growth, given its multiple long-term contracts with the world's leading brands.
Richer revenue visibility gives us confidence in its business growth moving forward. However, rising concerns over the prospects of large economies along with prevailing supply-side constraints pose uncertainties over the company's short-term growth rates.
Valuation and recommendation
We recommend a 'Hold' rating on the stock and assign a 30 times price/earning multiple to its FY26E earnings of Rs 215.8/share to arrive at a target price of Rs 6,400/share, implying an upside of 2% from the current market price.
Key risks to our estimates and target price
The demand environment is uncertain because of the potential threat of the recession from the world's largest economies.
The rising subcontracting cost and cross-currency headwinds may impact the company's operating margins negatively.
Click on the attachment to read the full report:
DISCLAIMER
This report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.
Essential Business Intelligence, Continuous LIVE TV, Sharp Market Insights, Practical Personal Finance Advice and Latest Stories — On NDTV Profit.
