Robust momentum in large deal bookings for LTTS in June quarter

 L&T Technology Services (LTTS) reported Q1FY26 revenue below expectations, primarily due to seasonal weakness in the SWC segment and challenges in the Mobility (Automotive) vertical. The Mobility segment was impacted by delays in decision-making on large deals, pauses in ongoing programs, and customer-driven discounting. This vertical is expected to remain subdued in the near term.

LTTS reiterates its double-digit revenue growth guidance for FY26

Despite these headwinds, LTTS has reiterated its double-digit revenue growth guidance for FY26E, which includes contributions from inorganic growth (factored in ~5% organic growth for FY26E). The company also maintains its mid-sixteen EBIT margin target for the period between Q4FY27E and Q1FY28E. Management anticipates stronger performance in H2FY26 compared to H1FY26, both in terms of revenue and margins.

Medium term revenue goal of $2 billion

LTTS has reaffirmed its medium-term revenue goal of $ 2bn. The robust momentum in large deal bookings during the quarter supports the view that FY26 will outperform FY25. The company aims to consistently achieve $ 200mn+ in Large Deal Total Contract Value (LD TCV) each quarter, with plans to scale this further. Given the uncertainties in the mobility vertical, we have revised our earnings estimates downward.

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Source: HDFC Securities Institutional Equities

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