L&T Tech Services sees 20% FY24 revenue growth, posts profit beat in Q4

Engineering services company L&T Technology Services (LTTS) has ended 2022-23 (FY23) with a net profit of Rs 1,174.1 crore — up 22 per cent, compared with the previous year. The company expects a 20 per cent growth in US dollar constant currency (CC) for 2023-24 (FY24) amid global macroeconomic uncertainties.  

LTTS recorded a net profit of Rs 310.9 crore for the fourth quarter (Q4) of FY23 — an increase of 18 per cent, compared with the same period a year ago.

Revenue from operations grew 19.4 per cent year-on-year to Rs 2,096.2 crore, with strong growth in key verticals of transportation, plant engineering, and industrial products. However, revenue from North America, which has a share of 60.2 per cent in total revenue, dipped 1.4 per cent sequentially.

For the full FY23, the company bagged $990 million in CC revenue — an increase of 15.8 per cent against its revenue guidance of 15 per cent. The technology firm has also reported a record highest earnings before interest and tax margin of 18.5 per cent in FY23. The board has recommended a final dividend of Rs 30 per share for FY23.

“We are negotiating several deals and the pipeline is fairly strong. The number of deals we have signed in total contract value (TCV) in FY23 is similar to last year. We have ended the year with our five key segments doing very well, which I feel will be good for us for next year,” Amit Chadha, chief executive officer and managing director, LTTS, told Business Standard.

“Our bets on electric autonomous connected vehicles, next-generation connectivity, digital products and manufacturing, artificial intelligence and medical technology will take off for us. We have differentiated assets, and that will help us as we move forward,” he added.

In Q4FY23, the company won a $40-million deal and three $10-million-plus TCV deals. As of March 31, 2023, the patent portfolio of LTTS stood at 1,090, of which 727 are co-authored with its customers and the rest filed by the company.

The CC revenue guidance of the firm for FY24 at over 20 per cent is higher than the growth achieved in FY23. Of this, the company expects 10 per cent organic growth.

“Increased offshoring pyramid, automating some of the work with no code platforms that we have developed internally, leveraging various technology assets, and our patents continuing to pile on some more technology focus add up to what we are trying to get,” said Chadha.

At the end of Q4FY23, the global headcount of the company was at 22,233 people. The fresher hiring target for FY24 is between 1,500 and 2,000.