L&T Technology Services Navigates Margin Declines with Optimistic Growth Prospects

L&T Technology Services reported a 4.1% drop in Q3 net profit due to narrowed margins, despite a 9.5% revenue growth. CEO Amit Chadha highlighted strong performance in tech and sustainability and a confident outlook on mobility. The pipeline remains strong, with notable contract growth.

L&T Technology Services recorded a 4.1% decline in net profit for the December 2024 quarter, amounting to Rs 322.4 crore, driven primarily by narrowed profit margins. In comparison, the company had reported a net profit of Rs 336.2 crore during the same period last year.

Despite the profit dip, revenues surged by 9.5% year-on-year to Rs 2,653 crore. CEO and Managing Director Amit Chadha noted robust growth in the technology and sustainability sectors, with respective increases of 3.5% and 7.5%. However, the mobility vertical saw only a 4.7% increase, affected by seasonal furloughs and prevailing trends.

The operating profit margin decreased to 15.9% from the previous year's 17.2%. Challenges included salary increases and an acquisition impact. Chadha expressed optimism about maintaining growth momentum, targeting a medium-term margin boost to 17-18%, supported by rising revenues and automation advances.

(With inputs from agencies.)