LTIMindtree investors need to brace for slower-than-expected revival
LTIMindtree's revenue growth recovery has been slower than anticipated due to delayed deal closures, slower project ramp-ups, and changes in the deal mix. “We lower FY24-26E earnings per share by 0.2-1.2%, factoring-in the Q1 performance and the anticipated slower recovery," added the Emkay report. Also, this sluggish start to the financial year raises concerns about the company's ambition to achieve double-digit revenue growth.
“With flat sequential revenue performance in Q1, the ask rate is substantial (>4% CQGR) for LTIM to achieve its ‘aspirational’ double-digit growth for FY24E," said analysts at HDFC Securities Ltd. CQGR is short for compound quarterly growth rate.
Despite these concerns, LTIMindtree has proven its mettle in 2023 by outperforming the Nifty IT index with a 16% return. The firm's strong partnerships with hyperscalers and robust domain capabilities position it well for future growth.
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