You are here: Home » Markets » News
Business Standard

L&T Infotech surges 10%, nears record high on robust Q2 results

The company reported the strongest sequential revenue growth of 8.9 per cent in constant currency terms during the July-September quarter

Buzzing stocks | Markets | L&T Infotech

SI Reporter  |  Mumbai 

L&T Infotech (Photo: Wikipedia)

Shares of Larsen & Toubro (L&T) Infotech rallied 10 per cent to Rs 6,496.40 on the National Stock Exchange (NSE) in Tuesday’s intra-day trade after the company reported the strongest sequential revenue growth, its best ever for the July-September quarter (Q2), at 8.9 per cent in constant currency terms.

The stock of the L&T group information technology (IT) consulting & software company was trading close to its record high of Rs 6,498.50 touched on September 24, 2021.

on Monday reported a net profit of Rs 552 crore for the second quarter ended September 30, 2021 (Q2FY22), up 21 per cent year-on-year (YoY) and 11 per cent sequentially. Strong demand led to revenue growth of 25.6 per cent YoY at Rs 3,767 crore, while the figure was up 8.8 per cent sequentially.

Growth was broad-based across verticals, service lines, geographies and client buckets. Broad-based industry growth was led by BFS and manufacturing. The company’s earnings before interest and tax (EBIT) margin expanded 350 basis points (bps) YoY and 270 bps quarter-on-quarter (QoQ) to 19.9 per cent during the quarter. Ebit margins expansions led by SG&A leverage, offshoring, and higher working days, partially offset by utilisation and higher costs.

The management said that this was the strongest sequential growth the company has witnessed, taking its annual revenue run rate to cross $2 billion. It expects demand to remain strong over the next three years. Despite the absence of large new deal wins in recent quarters, L&T Infotech’s growth momentum is one of the strongest in its history, indicating the broad-based nature of the demand environment, the company said.

The board has declared an interim dividend for the financial year 2021- 22 of Rs 15 per equity share of the face value of Re 1 each.

The company has fixed October 26, 2021, as record date to ascertain beneficial owners of equity shares to get interim dividend.

Financial Services expects better margin in 2H (v/s 1HFY22), driven by continued strong growth, which will offset the supply-side impact. "The management continues to be focused on driving growth with a stable margin. We expect the net margin to remain in the guided range of 14-15 per cent," the brokerage firm said in a results update.

The brokerage also raised its FY22E/FY23E EPS by 7 per cent on the back of strong demand outlook, resulting in revenue upgrades. “Our margin estimates continue to be in line with the management’s guidance. As Digital turns mainstream, we expect to benefit from continued investments in Digital capabilities, strong client additions, and its mining abilities. This should result in industry-leading growth,” it added.

Dear Reader,

Business Standard has always strived hard to provide up-to-date information and commentary on developments that are of interest to you and have wider political and economic implications for the country and the world. Your encouragement and constant feedback on how to improve our offering have only made our resolve and commitment to these ideals stronger. Even during these difficult times arising out of Covid-19, we continue to remain committed to keeping you informed and updated with credible news, authoritative views and incisive commentary on topical issues of relevance.
We, however, have a request.

As we battle the economic impact of the pandemic, we need your support even more, so that we can continue to offer you more quality content. Our subscription model has seen an encouraging response from many of you, who have subscribed to our online content. More subscription to our online content can only help us achieve the goals of offering you even better and more relevant content. We believe in free, fair and credible journalism. Your support through more subscriptions can help us practise the journalism to which we are committed.

Support quality journalism and subscribe to Business Standard.

Digital Editor

First Published: Tue, October 19 2021. 09:32 IST