L&T Technology Services shares rise 5%; what's boosting rally in stock?

L&T Technology Services shares rose 4.9 per cent in Friday's trade on BSE, logging an intraday high at Rs 5,157.6 per share. Around 12:37 PM, L&T Tech share price was up 4.23 per cent at Rs 5,120.95 per share on BSE. In comparison, the BSE Sensex was down 0.42 per cent at 75,420.26. The market capitalisation of the company stood at Rs 54,219.41 crore. The 52-week high of the stock was at Rs 5,990 per share and the 52-week low was at Rs 4,228 per share.

 

Global brokerage Macquire double upgraded the stock to 'Outperform' for a target of Rs 6,530 per share, as per reports. The brokerage expects growth to pick up in plant and engineering.

 

Besides, after the company posted its Q3 results, Motilal Oswal reiterated the 'Buy' call with an increased target price of Rs 5,500 per share. Centrum Broking in the same period continued with a 'Reduce' rating and reduced the target price to Rs 5,050 per share from  Rs 5,115. HDFC Securities maintained 'Reduce' on LTTS with a target price of Rs 4,730 per share.

 

Recently, in an exclusive interaction with Business Standard, Chief Executive Officer and Managing Director Amit Chadha said that L&T Technology Services is targeting $3 billion in revenue in the short to medium term. The company aims to scale each of its key divisions—mobility, sustainability, and technology—to $1 billion within this timeframe. 

 

Further, the overall goal in the longer term is to make the firm a $5 billion company, which should propel it to the largest E&RD company globally, from its current third position.

 

In Q3, LTTS reported a 4 per cent decline in net profit for the quarter that ended December 31, 2024, at Rs 322.4 crore as compared to Rs 336.2 crore a year ago. On a quarter-on-quarter (Q-o-Q) basis, the profit after tax (PAT) was up 1 per cent.

 

The company's revenue for the quarter under review stood at Rs 2,653 crore, up 9.5 per cent year-on-year (Y-o-Y), as compared to Rs 2421.8 crore. On a sequential basis, the revenue was up 3 per cent. The company's operational performance was healthy with Earnings before interest and tax (Ebit) margin improving 110 basis points (bps) sequentially to 16.2 per cent (excluding one-time non-operational M&A expense), after absorbing wage hikes, as per the filing.  

 

In the past one year, L&T Technology shares have lost 6.9 per cent against Sensex's rise of 4 per cent.