LTIMindtree - On A Strong Footing With Both Revenue, Cost Synergies In Place: ICICI Securities
No material impact on banking, financial services and insurance vertical due to Silicon Valley Bank crisis.
BQ Prime’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer BQ Prime’s subscribers an opportunity to expand their understanding of companies, sectors and the economy.
ICICI Securities Report
We attended LTIMindtree Ltd.'s Investor Day 2023 (on March 14), wherein the management reiterated its aspiration to achieve $1 billion incremental revenue through cross-sell synergies over the next two-four years and reach 19-20% Ebit margins by FY27 i.e. improvement of ~200 basis points on pro-forma margins of the combined entity as on FY22.
Mindtree Ltd. is stronger in front-end digital solutions and Larsen and Toubro Infotech Ltd. is stronger in back-end enterprise resource planning related core transformation solutions. Given the complimentary service line expertise of L&T Infotech and Mindtree, LTIMindree aims to derive revenue synergies through cross-sell/up-sell opportunities across the existing 374 client accounts of more than $1 million in revenue size.
For the same, it is investing in strengthening service line sales leadership and capabilities. Management mentioned demand for technology transformation is secular; however, in the near term, due to macro uncertainty it is seeing longer decision-making cycles in terms of conversion of pipeline to total contract value and execution of TCV to revenue largely in discretionary spends.
Pipeline is healthy with 68 large deals (more than $ 20 million deals) amounting to TCV of $3.2 billion. It is characterised by higher share of cost optimisation deals compared to last year.
LTIMindree’s exposure to Silicon Valley Bank is not material and the recent fallout of the bank does not have any material impact on it, as per the management.
Click on the attachment to read the full report:
More Research Reports On LTIMindree's Investors Day Meet
This report is authored by an external party. BQ Prime does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of BQ Prime.
Users have no license to copy, modify, or distribute the content without permission of the Original Owner.