Shares of L&T Technology Services (LTTS) surged over 9 percent on Thursday, January 16, following the company's announcement of its third-quarter financial results. While LTTS reported a 4.1 percent year-on-year (YoY) drop in net profit to ₹322.4 crore, impacted by currency headwinds, the market reacted positively to its record-breaking large deal bookings and robust revenue growth.
Net profit for the quarter stood at ₹322.4 crore, compared to ₹336.2 crore in the previous quarter and ₹319.6 crore a year ago, reflecting a sequential growth of 0.9 percent. Revenue for the quarter increased 9.5 percent YoY to ₹2,653 crore, up from ₹2,421 crore in the same period last year, with sequential growth of 3.1 percent. Dollar revenue rose to $312 million, showing a 3.1 percent sequential growth and an 8.7 percent YoY increase in constant currency terms.
CEO and Managing Director Amit Chadha attributed the quarter's performance to strong momentum in key verticals like Medtech, communications, hi-tech, and media. "We had a strong quarter with 3.1 percent growth in constant currency led by our Tech (11 percent) segment. The deal momentum in key verticals also contributed to building up the margin trajectory," Chadha stated.
For FY25, LTTS has set a target of approximately 10 percent revenue growth in constant currency, including contributions from its recent acquisition of Intelliswift. "We reaffirm our medium-term outlook of achieving $2 billion in revenue with EBIT margins of 17–18 percent," Chadha added.
The EBITDA margin for the quarter improved by 110 basis points sequentially to 16.2 percent, excluding one-time non-operational M&A expenses. The company also indicated that EBIT margins in the second half of FY25 are expected to outperform those of the first half.
LTTS secured eight large deals during the quarter, including one valued at $50 million, two at $35 million, and two at $25 million. "Our large deal TCV has seen a healthy increase with eight wins across segments. The large deal pipeline remains robust, supported by ongoing engagements with customers in new-age product and platform development and business transformation," Chadha said.
Looking ahead, Chadha expressed optimism for the future, stating, “CY25 will be better than CY24. Our pipeline today is bigger than what it was a quarter and a year ago. We have multiple $50 million and $100 million deals that continue to build up.”
With strong deal wins and optimistic guidance, LTTS appears well-positioned for sustained growth in the coming quarters.
The IT stock surged as much as 9.2 percent to its day's high of ₹5336.45. The stock is now just 11 percent away from its peak of ₹5,990, hit in August 2024. Meanwhile, it has advanced 26 percent from its 52-week low of ₹4,228.00, recorded in June 2024.
In the last 1 year, the stock has shed over 9 percent while added over 11 percent in January 2025 so far. This comes after an over 10 percent fall in December.
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