IT services firm LTM, formerly known as LTIMindtree, is expected to report modest sequential growth in the June quarter, with revenue and profit likely to edge higher even as its exposure to West Asia and softer demand in the travel vertical weigh on business momentum.
LTM is scheduled to announce the earnings for the first quarter of FY27 on Saturday, July 11.
LTM Q1 Preview (Consolidated, QoQ, Bloomberg Estimates)
Revenue seen 2% higher at Rs 11,561 crore versus Rs 11,292 crore
EBIT seen 2% higher at Rs 1,748 crore versus Rs 1,709 crore
EBIT margin seen at 15.11% versus 15.13%
Profit seen 2% higher at Rs 1,425 crore versus Rs 1,392 crore
Brokerages broadly expect LTIMindtree's June-quarter growth to remain muted as the conflict in West Asia and softer travel demand weigh on revenue. Investors will closely watch management commentary on the outlook for the company's two largest clients, the integration of the Randstad acquisition, the ramp-up of the Central Board of Direct Taxes project, demand across key verticals and the FY27 growth outlook.
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Here's what analaysts are expecting from LTM Q1 results.
Jefferies
- Expects muted revenue growth in the June quarter.
- Key focus areas include the outlook for the company's two largest clients and an update on the Randstad acquisition.
Goldman Sachs
- Expects a largely flat sequential revenue performance.
- Growth likely to slow due to exposure to West Asia, weaker travel demand and lower manufacturing pass-through revenue.
- EBIT margin expected to remain broadly stable as operational efficiencies and currency tailwinds offset the partial impact of wage hikes.
Nirmal Bang
- Expects 0.3% quarter-on-quarter revenue growth.
- Growth supported by a strong order book, the Aramco joint venture becoming fully operational and the GCC-as-a-service business, partly offset by the conflict in West Asia.
- Expects EBIT margin to expand by about 20 basis points to 15.3%, supported by Fit4Future initiatives.
- Remaining impact of wage hikes announced in the previous quarter expected to be reflected in Q1.
- Key monitorables include pressure in the travel vertical, AI initiatives and revenue outlook.
Axis Capital
- Expects 0.3% quarter-on-quarter revenue growth, driven by the ramp-up of previously won deals and stabilisation in the banking, financial services and insurance vertical.
- Expects EBIT margin to decline by about 10 basis points as the full-quarter impact of wage hikes offsets currency benefits, operational efficiencies and the absence of branding expenses.
- Key focus areas include the FY27 growth outlook, the impact of the West Asia conflict and progress on the Central Board of Direct Taxes project.
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