L&T Technology Services shares faced selling pressure on Wednesday, a day after the engineering services company announced a set of quarterly numbers that fell short of analysts' estimates on most parameters. L&T Tech shares — traded on the bourses with the symbol LTTS — declined by as much as Rs 32.7 or 0.8 per cent to Rs 4,030.9 apiece in early deals on BSE. 

L&T Tech Services Q1 results: A summary 

COMMERCIAL BREAK
SCROLL TO CONTINUE READING

After market hours on Tuesday, L&T Tech Services reported a net profit of Rs 311 crore for the quarter ended June 2023, marking a decline of 8.5 per cent compared with the previous three months. Its revenue fell around three per cent sequantially to Rs 2,301 crore or $280 million, according to a regulatory filing. 

Mumbai-based L&T Tech Services' margin — a key measure of profitability — contracted by 70 basis points on a quarter-on-quarter basis to 17.2 per cent. 

According to Zee Business research, L&T Tech services' quarterly net profit was estimated at Rs 320 crore, revenue at Rs 2,350 crore or $286.5 million, and margin at 18.3 per cent. 

L&T Tech Services maintained its revenue growth guidance at 20-plus per cent in constant currency terms. 

EDITOR'S TAKE | How Anil Singhvi views LTTS's Q1 results 

Zee Business Managing Editor Anil Singhvi gave a 'sell' call on LTTS futures for targets of Rs 3,930 and Rs 3,850 with a stop loss at Rs 4,100. The market wizard said the company's large deal wins in the three-month period were satisfactory.

What brokerages say on LTTS

According to Nomura, which maintained a 'reduce' rating on LTTS after the company's earnings announcement and reduced its target price by Rs 20 to Rs 2,980, the engineering services company's revenue growth target of 20 per cent is lofty. 

A recovery in margin back to 18 per cent still appears to be some time away for LTTS, according to the brokerage. 

Nomura's target price implies a 26.7 per cent downside in LTTS shares from Tuesday's closing price.

Brokerage Rating Target price
Morgan Stanley Underweight Rs 3,200
JP Morgan Underweight Rs 2,900
Citi Sell Raised to Rs 3,060 from Rs 2,995
Nomura Reduce Reduced to Rs 2,980 from Rs 3,000

L&T Tech Services shares

L&T Tech Services shares appreciated 16.4 per cent in value in the June quarter, outperforming a 10.5 per cent gain in the Nifty index. As of July 17, LTTS shares have grown 32.5 per cent in value in the past one year while the Nifty rose 23.4 per cent.

Catch latest stock market updates here. For all other news related to business, politics, tech, sports and auto, visit Zeebiz.com.