LTI Mindtree share price slumped 2% in trade today after delivering soft numbers in Q4. LTIMindtree had a challenging FY25 as growth slowed down in the second half of FY25 due to a delay in deal execution and client-specific challenges. As a result, key brokerage houses cut their price target for the share price, even though they retained the ‘Buy’ target. According to them, the task is cut out for the new management going forward.
Nuvama on LTIMindtree: Margins to rise in Q1
The brokerage house Nuvama Institutional Equities slashed the target price on LTIMindtree by almost 3% to Rs 5,200 from Rs 5,350 after the tech company reported a weak quarterly performance, majorly on the revenue front.
The brokerage house cut the earnings per share (EPS) estimates by 3.3% for FY26 and 2.5% for FY27 due to slightly lower growth and margin expectations.
The company started FY25 on a good note with robust revenue growth in the first half, but later that momentum slowed down due to macro uncertainties (Trump’s reciprocal tariffs), delay in deal execution, and client-specific challenges.
“In Q4, headwind from the transfer of productivity benefits to the top client is complete, with no incremental headwind expected from Q1,” said Nuvama.
Also, the company’s management expects margins to rise from Q1, driven by efficiency measures. According to the research note, the new chief executive officer, Venu Lambu, highlighted his strategic priority to deliver industry-leading growth as well as improve margins from Q1FY26.
However, the brokerage said that the company is now in a unique position, wherein it is likely to deliver modest but higher earnings growth than large-cap peers, while being available at a valuation similar to them. “We continue to like the company, its strong delivery capabilities & clientele and strong positioning in key verticals,” Nuvama added.
Motilal Oswal on LTIMindtree: Cuts FY27 EPS estimate
Motilal Oswal has also cut the target price while maintaining a Buy rating. According to the brokerage house, its capabilities in data engineering and ERP modernisation support the Buy call. “The current stock price also offers attractive valuation comfort. While our FY26 estimates remain largely unchanged, we lower our FY27 EPS estimate by 5% to account for the current macroeconomic headwinds,” Motilal Oswal added. They now value LTI Mindtree at 26x FY27E EPS (earlier 30x), leading to a revised target price of Rs 5,150, implying a 14% upside from the current level.
The company’s Fit for Future” initiative to drive cost efficiency and improve profitability, starting in Q1FY26, includes reassessing direct and indirect costs, optimising delivery and sales structures, and continuing pyramid correction efforts. Motilal Oswal pointed out that though these steps align well with client demand for cost savings and modernisation, “management has not provided a tighter guidance range or timeline, which makes the margin expansion trajectory a tad vague, in our view.”
LTIMindtree Q4 results
The company reported a 2.6% year-on-year growth in consolidated net profit for Q4FY25, standing at Rs 1,128.5 crore, up from Rs 1,107 crore recorded in the corresponding quarter of the last year. On a quarter-on-quarter basis, the profit inched up 4% from Rs 1,086.7 crore in Q3. Its revenue from operations for the reporting quarter stood at Rs 9,771.7 crore, an increase of 1.1% sequentially and 9.9% YoY. Also, the company’s board declared a final dividend of Rs 45 per equity share for the financial year.