L&T Technology Services: Mixed Q1: Soft deal wins but better visibility on expanding margins

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L&T Technology Services: Mixed Q1: Soft deal wins but better visibility on expanding margins

iQprofile SM L&T Technology Services

Key Income Statement Data (Mar) 2025A 2026A 2027E 2028E 2029E Company Sector

(Rs Millions) Outsourcing Services

Sales 106,702 109,959 120,410 132,443 146,129

Gross Profit NA NA NA NA NA

Sell General & Admin Expense (30,892) (26,035) (27,796) (30,462) (33,610) Company Description Operating Profit 15,871 15,898 19,402 22,038 24,516

Net Interest & Other Income 1,536 1,571 1,372 2,281 2,566 L&T Technology Services is a leading participant in

Associates NA NA NA NA NA engineering, research and development services for

Pretax Income 17,407 17,469 20,774 24,319 27,082 transportation, telecom, industrial products and process

Tax (expense) / Benefit (4,773) (4,445) (5,321) (6,201) (6,906) engineering industries. Key services are mechanical

Net Income (Adjusted) 12,665 13,516 15,434 18,106 20,164

engineering, embedded systems services and product

Average Fully Diluted Shares Outstanding 106 106 107 107 108

software. North America is the largest market followed by

Key Cash Flow Statement Data

continental Europe.

Net Income 12,665 13,005 15,434 18,106 20,164

Depreciation & Amortization 3,053 3,452 3,563 3,708 4,092

Change in Working Capital (223) (721) (1,167) (1,330) (1,432)

Deferred Taxation Charge NA NA NA NA NA Investment Rationale

Other Adjustments, Net (684) (1,185) (2,988) (3,113) (3,468) We like LTTS' breadth of exposure by industry and existing

Cash Flow from Operations 14,811 14,551 14,842 17,370 19,357 presence in key customers of engineering services. These,

Capital Expenditure (1,116) (1,851) (4,199) (2,557) (2,822) alongside payoff from recent investments by way of uptick

(Acquisition) / Disposal of Investments 2,174 (2,424) 0 0 0