L&T Tech Q4 result review: Stock tanks 9.5% as brokerages remain cautious, cut estimates
₹340 crore, due to slower revenue growth and a reduction in margins. Its revenue grew 5 percent YoY to ₹2,537.5 crore. In terms of margins, management expects a "slightly muted" performance in the near term as the company invests in critical areas for future growth.
For the quarter under review, the operating profit margin came at 16.9 percent as against 17.9 percent in the year-ago period and 17.2 percent in the quarter-ago period. Meanwhile, the engineering services company's net profit for FY24 grew 7.6 percent to ₹1,303.7 crore. LTTS Managing Director and Chief Executive Amit Chadha said the revenues in the year-ago period were higher because of the gains coming out of the acquired company, Smart World.
He added the company has been reporting the operating profit margin at 17-18 percent in the past, but the level may get compressed due to investments. He also announced a restructuring of the organisation, under which it has narrowed down the number of business verticals to three from the earlier five. Unable to cheer the Street with its Q4 results, the stock tanked 9.5 percent to its day's low of ₹4,689.50.
It is now over 20 percent away from its peak of ₹5,884.95, hit on April 4, 2024. Meanwhile, it is still up 34 percent from its 52-week low of ₹3,500, hit on April 27, 2023. It has gained almost 51 percent in the last 1 year but is down 9 percent in 2024 YTD.
Post the Q4 results, most brokerages remained cautious on the stock and cut their earnings estimates for the IT firm. Morgan Stanley: Morgan Stanley has issued an "underweight" rating for L&T Tech with a target price of ₹4,200, indicating a 19 percent downside. The firm's fourth-quarter results were below expectations, and the guidance for weaker revenue
. Read more on livemint.com
