L&T Technology Services maintains FY24 revenue guidance at 17.5-18.5%

L&T Technology Services (LTTS), the engineering services arm of L&T Group, on Friday maintained its FY24 revenue growth forecast at 17.5-18.5 per cent, indicating a positive fourth quarter.    

It comes in the backdrop of larger IT service providers like Infosys and HCLTech, which cut or tightened their revenue growth guidance last week as the demand environment continues to be challenging and clients cut back on discretionary spending.

Infosys has tightened its FY24 revenue growth guidance to 1.5 – 2 per cent in constant currency from the 1-2.5 per cent it had guided earlier.

HCLTech also lowered the upper end of its full-year revenue growth guidance to 5-5.5 per cent in constant currency from the 5-6 per cent it had guided earlier.      

LTTS reported a 13.3 per cent rise in net profit to Rs 336 crore, as revenues grew 12.3 per cent to Rs 2,157 crore.

The dollar revenue grew 0.9 per cent sequentially in constant currency to $290.7 million on the back of broad-based growth across sectors.

“All 5 segments grew positively for the second quarter in a row giving us 1 per cent sequential growth despite the seasonal softness. A milestone win for us was the start of a significant relationship with bp to drive digital transformation. Our operational performance was steady helping us achieve double-digit profit growth,” said Amit Chadha, chief executive officer (CEO) and managing director, LTTS.

The EBIT margin for the December quarter marginally expanded to 17.2 per cent compared with 17.1 per cent in the preceding three months.

North America, its largest market grew 2.1 per cent year-on-year (Y-o-Y) and contributed 54.6 per cent to the total revenues as of Q3. India, its second-largest, market grew 33.4 per cent Y-o-Y and contributed 21.5 per cent to the revenue. Europe, which contributed 16.6 per cent to the revenue, grew 21.1 per cent Y-o-Y.

The attrition rate declined to 15.8 per cent from 16.7 per cent in the preceding three months, indicating it is gradually coming down, a trend seen across the industry.   

The shares of LTTS were down 1.8 per cent to settle at Rs 5,346.85 apiece on the BSE.