LTIMindtree: 5 key highlights from Investor Day; share price targets

LTI Mindtree Ltd (LTIM) recently hosted Investor Day, where the management highlighted a strong pipeline with largest share (48 per cent) from cost optimisation. It told IT analysts that discretionary spends are yet to pick up, but felt investments in GenAI capabilities could be a key differentiator. The IT major is targeting $10 billion in revenue by FY31-32 and is aiming for 17–18 per cent margins in immediate future, with potential for further expansion driven by growth.

There has been some improvement in number of transformation deals in recent quarters, said Centrum Broking. This brokerage sees green shoots in demand environment, especially in the BFSI vertical. 

"We expect the revenue growth momentum to continue in Q3FY25. AI led deals continue to drive deal pipeline. We expect Revenue, Ebitda and PAT to grow at 12.8 per cent, 16.3 per cent and 18.2 per cent, respectively, over FY24-FY27E. We have kept our estimates unchanged. We maintain BUY Rating on the stock with unchanged target price of Rs 7,250 at PE of 30x on Sep’26E EPS," Centrum Broking said.

With BFSI clients increasing spending on transformation projects, LTIM stands to benefit despite its margin challenges, MOFSL said.  "We value LTIM at 35 times September 2026 EPS, and our target price of Rs 7,400 (unchanged) suggests a 19 per cent upside potential," MOFSL said.

Nuvama Institutional Equities said it continues to like LTIM, with its unique story of strong earnings growth potential, driven by portfolio mix geared towards growth. For now, this brokerage has maintained its estimates and continues to value LTIM at 33 times estimated September 2026 EPS. The brokerage suggested a ‘BUY’ for LTIMindtree with a target price of Rs 7,550. 

"Our target price of Rs 5,140 is set at 24x FY27F EPS of Rs 214 based on our three-stage growth model. Upside risks: strong large-size deal wins and higher-than-expected margin expansion. We prefer Infosys and Wipro in the large-cap India IT services space," it said.

The LTIMindtree management expects to maintain the current deal momentum. It highlighted that overall pipeline continues to remain strong at $5 billion with 14 $100 million-plus and 21 $50–100 million deals in pipeline. 

Deal pipeline consists of cost optimisation (48 per cent), transformation (23 per cent), vendor consolidation (17 per cent), empanelment (10 per cent) and GCC (2 per cent). LTIMindtree said the focus on large deals have yielded results on 45-plus large deals in the last 18 months with combined total contract value (TCV) of $2 billion-plus.

"LTIM has launched project North Star with goal to improve margin to 17–18 per cent in immediate future, and expand further, as growth environment returns. Key levers for margin improvement will be: i) Revenue maximisation by matching right skill for right price. ii) Bending the cost curve: Pyramid and average cost; iii) Productivity: Improving revenue per person, Automation and AI; iv) Overheads: Eye on discretionary spends with increase in overheads to be less than revenue growth," Nuvama noted.