Sharekhan has given Buy recommendation for Larsen and Toubro Infotech with a target price of Rs. 5750 in its research report issued on Aug 24, 2021
Sharekhan’s research report on Larsen and Toubro Infotech
LTI is well poised for another year of industry-leading growth in FY2022, led by strong growth in top accounts, recovery in impacted verticals, healthy deal pipeline, and improving demand for its cloud and data products business. LTI targets to add 4,500 freshers (1.5x of FY2021) in FY2022. Further, the company would hire 1,500 employees with 1-2 years of experience. Strong planned hiring indicates the strength of underlying demand across verticals. Management eyes net profit margin of 14-15% in FY2022E despite investments in building capability and S&M investments, led by strong revenue growth, higher offshoring, cost-optimisation measures, and hedging strategy.
Outlook
We maintain our Buy rating on L&T Infotech (LTI) with a revised PT of Rs. 5,750, given broad-based demand across verticals, robust deal pipeline, and strong partnership with hyperscalers.