L&T Tech share price plunges 5% as SWC acquisition announcement fails to cheer Street; Morgan Stanley maintains 'underweight'

Shares of IT company L&T Technology Services declined 5 per cent after global brokerage firm Morgan Stanley tagged 'underweight' rating. At 1 PM, the counter quoted Rs 3,444, down Rs 200 or 5.46 per cent on NSE. It has touched an intraday high of Rs 3,580 and low of Rs 3,404.20.

The sharp fall in the share price of the company comes a day after it announced to acquire the Smart World & Communication (SWC) business of its parent firm Larsen & Toubro Limited in an all-cash deal worth Rs 800 crore.

Morgan Stanley in its report said that L&T Technology Services shares can test Rs 3,300. It said that the transition of SWC's domestic business to global clientele profile will weigh on sentiment.

Meanwhile, Macquarie has given an Outperform call with price target of Rs 4,630.

Zee Business panellist and market expert Siddharth Sedani said that the order inflows were strong and expected to remain the same in this quarter too. The total order inflows are 3.72 lakh crore, their order book also looks good. He said recommended buying the shares of the IT company for a price target of Rs 2230. 
 
Smart World & Communication (SWC) has an employee base of over 700 engineers from diversified technology domains and has crossed an annual revenue of Rs 1,000 crores, LTTS said in a statement.

SWC was founded in 2016 to cater to the demands in smart cities, address opportunities and provide smart solutions in the areas of end-to-end communications, city surveillance and intelligent traffic management system for the Government as well as enterprises.

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