On Thursday, Nuvama, a financial services firm, increased its price target for LTIMindtree Ltd (NS:LTIM:IN) shares to INR 7,000 from the previous INR 6,650, while maintaining a "Buy" rating on the stock. This adjustment follows the company's strong start to the fiscal year 2025, with first-quarter results surpassing expectations.
LTIMindtree reported a 2.5% quarter-over-quarter and 3.5% year-over-year increase in USD revenue, reaching USD 1,096.2 million, which was ahead of the forecasted 1.9% quarterly growth. Additionally, the company's EBIT margin improved by 30 basis points quarter-over-quarter to 15%, also exceeding estimates.
The company's deal flow remained steady, with a total value of INR 1.4 billion, marking a slight 0.7% increase from the previous quarter but a 0.7% decrease year-over-year. Despite a challenging fiscal year 2024, LTIMindtree has shown a robust performance at the onset of FY25.
Management's outlook remains positive, with expectations of continued growth momentum into the second quarter of FY25. This optimism is based on the company's current trajectory and the anticipated ramp-up of deals.
In light of these developments, Nuvama has made minor adjustments to its FY25 and FY26 earnings per share (EPS) estimates, with a roughly 2% tweak due to a slightly lower other income.
Additionally, the firm has introduced its FY27 estimates and has rolled forward the valuation to 30 times the September 2026 estimated PE. The maintained "Buy" rating and the revised target price reflect Nuvama's confidence in LTIMindtree's growth prospects.
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