L&T Technology shares down 1% as Q1 net profit grows marginally

L&T Technology announced on Thursday a 0.8% year-on-year (YoY) rise in its Q1 net profit to ₹313 crore. The consolidated revenue for the quarter grew by 7% YoY to ₹2,461 crore. Following the announcement, shares of the company were down by 1.07% at ₹4,798.70 per share.

For the first quarter of FY25, the company’s earnings before interest, taxes, depreciation, and amortisation (EBITDA) saw a slight rise of 0.7% YoY to ₹456 crore. The EBITDA margin for the quarter contracted to 18.5% from 19.7% in the corresponding quarter last year. Meanwhile, the net profit margin shrunk to 12.7% compared to 13.5% in the previous year.

The company’s Mobility vertical saw growth of 13.4% YoY as it contributed 32% to the revenue. The Hi-Tech vertical saw a growth of 2.5% YoY with a 34.8% contribution to the revenue while the Sustainability vertical saw an incremental rise of 0.5% YoY as it contributed 30% to the company’s revenue.

During the quarter, the company won several deals including two deals valued at $30 million each. The company has filed a total of 61 patents related to AI which has helped the company bag deals for its Generative AI solutions.

Amit Chadda, chief executive officer and managing director of L&T Technology Services, stated that the company’s operational performance was impacted by revenue seasonality and the company’s investments into its segments to boost growth. The company expects to see improvement in EBIT margins in the coming quarters along with the FY25 guidance of 8-10% revenue growth.

“With phase one of our reorganization and related investments in technology and leadership complete, we reaffirm our FY25 guidance of 8-10% revenue growth in constant currency, and remain committed towards achieving the USD 1.5 billion revenue run rate.” He said.

Shares of the company have declined by nearly 8% since the beginning of the year. The stock has gained over 15% in the past year.