L&T Technology Services Limited

Technology — Information Technology Services · NSE

₹3,721.00+₹34.20 (+0.93%)

DalalBaazaar Score

58 / 100

🟡 Moderate

Verdict

NEUTRAL

Risk

Moderate

Driven by high debt relative to equity.

In simple words: Strong business and financial position, with modest growth. Debt is the main factor to watch.

Decision support, not a buy or sell call.

As of 18 Oct 2026, 6:59 pm

Understanding the Business

Company site ↗

The 60-second version of L&T Technology Services Limited — what it does, how it earns, and who it competes with, before any of the numbers below.

What does this company do?

L&T Technology Services Limited operates as an engineering research and development services company in India, North America, Europe, and other international markets. The company operates through three segments: Mobility, Sustainability, and Tech.

IndustryInformation Technology Services

SectorTechnology

Employees21,039

Annual revenue₹10,996 Cr

How does it make money?

Turns over ₹10,996 Cr a year. Of every ₹100 of sales, about ₹12 reaches shareholders as profit, with ₹21 left at the operating level before interest, tax and depreciation. Each of its 21,039 employees supports ₹52.3 lakh of revenue a year, the signature of a people-led business.

Revenue / employee₹52.3 lakh

Who are its competitors?

The closest listed comparisons in its industry are TATA CONSULTANCY SERV LT, INFOSYS LIMITED, HCL TECHNOLOGIES LTD, WIPRO LTD. These are the companies its valuation and returns are measured against elsewhere in this report.

Compared side by side in Peers ↓

What is its competitive advantage?The numbers suggest a real one

ROCE has stayed above 15% in every year available and stands at 24.0%. Returns that high normally get competed away; when they persist, something is protecting them, and its ROE of 19.8% against a peer median of 32.0% is consistent with that. What that something is — brand, scale, switching costs, regulation — the accounts cannot tell you.

Peer median ROE32.0%

What is the outlook?

29 analysts covering the stock expect revenue to grow about 9.4% and earnings to grow about 14.6% in the year to 2028. These are estimates by people who follow the company, not a forecast for the wider industry.

Est. revenue growth+9.4%

Est. earnings growth+14.6%

Analysts29

What has been driving growth?

Growth has come mainly from selling more, rather than from keeping more of each sale. Over 3 years revenue moved +25% while net margin moved -15% relative to itself. What this cannot tell you is which products, customers or geographies did the work — that lives in the segment disclosures of the annual report.

Revenue effect+25%

Margin effect-15%

DalalBaazaar Score

58/ 100

Moderate

Weighted across six categories. Every point is explained below.

✗ Revenue CAGR of only 7.6% — barely ahead of inflation
✗ Profit CAGR of only 1.8%
✗ Profit is compounding slower than revenue — margins are being squeezed as the business grows
✗ Latest-year revenue growth of 2.6% is below the longer-term trend — momentum is fading

Quality vs. Valuation

Company Quality

60/ 100

Average

How good the business is, ignoring the share price entirely.

Valuation

39/ 100

Expensive

What you are being asked to pay, ignoring how good the business is.

A reasonable business at a reasonable price — neither the quality nor the valuation stands out in either direction.

Historical Valuation

Current P/E

30.3x

3Y Median

36.9x

40 monthly readings · mean 37.1x · range 26.1x–48.8x

Sector Median

16.5x

median of 4 sector peers

🟢Current valuation is approximately 18% below its 3y median of 36.9x. Cheaper than its own history, which is worth a reason too: the market may be pricing in something the backward-looking numbers do not show.

⚠️Against its sector it trades 83% above the peer median of 16.5x.

vs. its own history

Fair

36.9x median over 40 months · -18%

vs. sector peers

Expensive

16.5x median of 4 peers · +83%

vs. generic bands

Fair

15x–35x

EV/EBITDA

16.6x

PEG

16.73

What's Good / What's Bad

🟢 What's Going Well2

High return on capital employed
ROCE of 24.0% is the mark of a business that converts capital into profit efficiently.
Consistently profitable
Profitable in every one of the last 4 reported years.

🔴 What Needs Attention2

Return on equity is falling
ROE has dropped from 27.3% to 19.8% — each rupee of shareholder capital earns less than it did.
Return on capital is falling
ROCE has declined from 35.4% to 24.0% — often a sign of competition or overexpansion.

Red Flags

3 items require attention · 2 high · 1 watch

🔴High leverageFinancial
Debt/Equity of 8.91x — earnings must service borrowings before shareholders see anything.
🔴Inventory building faster than salesFinancial
Inventory up 263% against revenue up 25% — stock may not be moving.
🟡Debt is increasingFinancial
Total debt is up 27% over 3 years.

Investment Thesis

🟢 Bull CaseWhat could make this work?

Capital compounds at a high rate
ROCE of 24.0% means each rupee reinvested earns well above what capital costs. If the company can keep deploying at this rate, growth creates value rather than just consuming cash.
Earnings have proved durable
Profitable in every one of the last 4 reported years. Consistency lowers the risk that any single bad year is structural rather than cyclical.

🔴 Bear CaseWhat could go wrong?

Leverage amplifies any setback
Debt/Equity of 8.91x. Interest is payable whether or not the business has a good year.
A premium to the sector to defend
It trades 83% above the peer median. That premium needs a reason that persists, or it closes.
Growth barely outpaces inflation
Revenue compounding at 7.6% a year is close to the rate prices rise, so the business is gaining little ground in real terms. That leaves the share price dependent on a re-rating rather than on earnings growth.
Returns on shareholder capital are falling
ROE has dropped from 27.3% to 19.8%. Each rupee of equity earns less than it did, so profit growth increasingly depends on raising more capital rather than on the existing base working harder.
Several serious flags at once
2 high-severity checks triggered. Individually each has an explanation; together they raise the chance that something structural is wrong rather than a one-off.

🟡 Key Things to WatchMeasurable tripwires, set against where this company stands today

1EBITDA margin holds above 19%✓ 21.0%
Two points below today's level — enough room for noise, tight enough to catch real compression.
2Revenue growth stays above 6% a year✓ 7.6% CAGR
Latest reported year was 2.6%. The bar is set below the established compounding rate, so ordinary variation does not trip it.
3Free cash flow remains positive✓ ₹1,270 Cr
Profit that never becomes cash eventually stops being profit.
4Debt / EBITDA stays below 2x✓ 0.3x
The ratio lenders write covenants against; it survives a small or negative equity base, unlike Debt/Equity.
5ROCE stays above 21%✓ 24.0%
Falling returns on capital are usually competition arriving, and show up here before they reach the margin.

Investment Checklist

10 / 12 checks passed

✓ Strong return on equity (ROE ≥ 15%)
✓ Strong return on capital employed (ROCE ≥ 15%)
✓ Healthy net margin (≥ 10%)
✓ Generates positive free cash flow
✗ Manageable leverage (Debt/Equity < 1.0)
✓ Adequate short-term liquidity (Current Ratio ≥ 1.0)
✓ Revenue growing year-over-year
✓ Profit growing year-over-year
✓ Not trading at an extreme valuation (P/E < 40x)
✓ Not buying right at the 52-week high
✓ Analyst consensus isn't majority-sell
✗ Short-term technical trend isn't bearish

Price history

Quick Metrics

5 good · 4 neutral · 2 weak

Market Cap

₹39,475 Cr

Mid Cap

Mid-sized — more growth headroom, but sharper swings than large caps

P/E (Trailing)

30.3x

Fair

Fairly valued against the generic band

P/B Ratio

6.09x

Rich

Steep premium to book — needs high, durable returns to justify

EPS (TTM)

₹122.73

Profitable

Profitable on a per-share basis

ROE

19.8%

Strong

Strong capital efficiency

ROCE

24.0%

Strong

Earns comfortably above its likely cost of capital

Debt/Equity

8.91x

High

High leverage

Revenue Growth (YoY)

2.6%

Modest

Modest growth

Profit Growth (YoY)

12.8%

Healthy

Profits growing at a healthy clip

Dividend Yield

1.56%

Modest

Small cash return — most of the return has to come from the price

Free Cash Flow

₹1,270 Cr

Cash generative

Generates cash even after funding its capex

More Metrics

P/E (Forward)

22.8x

Improving

Below the trailing multiple — the street expects earnings to grow into the price

Operating Margin

15.7%

Good

Healthy core-business profitability

Net Margin

11.7%

Good

Strong bottom-line conversion

Current Ratio

2.28

Comfortable

Healthy short-term liquidity

Beta (vs Nifty)

0.23

Defensive

Steadier than the market

52W Range Position

41%

Mid-range

Technical Snapshot

SMA 20 / SMA 50

3315.1 / 3429.7

Bearish alignment (short < long)

Price vs SMA 200

Above

Long-term uptrend

RSI (14)

75.0

Overbought zone

Financial Trend (4-Year)

Metric	FY23	FY24	FY25	FY26	3Y CAGR
Revenue	₹8,816 Cr	₹9,647 Cr	₹9,642 Cr	₹10,996 Cr	+7.6%
EBITDA	₹1,946 Cr	₹2,108 Cr	₹1,955 Cr	₹2,313 Cr	+5.9%
EBITDA Margin	22.1%	21.8%	20.3%	21.0%	—
PAT (Net Profit)	₹1,212 Cr	₹1,304 Cr	₹1,267 Cr	₹1,279 Cr	+1.8%
EPS	₹114.48	₹123	₹119.44	₹120.53	+1.7%
ROE	27.3%	24.5%	20.8%	19.8%	—
ROCE	35.4%	31.2%	25.5%	24.0%	—
Total Debt	₹454 Cr	₹659 Cr	₹578 Cr	₹579 Cr	+8.4%
Free Cash Flow	₹1,132 Cr	₹1,240 Cr	₹1,370 Cr	₹1,270 Cr	+3.9%

🟢 Revenue has grown at 7.6% a year over 3 years.

🟢 EBITDA has grown at 5.9% a year over 3 years.

🔴 EBITDA Margin has fallen from 22.1% to 21.0% over 3 years (-1.0 pts).

🟡 PAT (Net Profit) has been broadly flat over 3 years (1.8% a year).

🟡 EPS has been broadly flat over 3 years (1.7% a year).

🔴 ROE has fallen from 27.3% to 19.8% over 3 years (-7.6 pts).

🔴 ROCE has fallen from 35.4% to 24.0% over 3 years (-11.4 pts).

🔴 Total Debt has grown at 8.4% a year over 3 years.

🟢 Free Cash Flow has grown at 3.9% a year over 3 years.

Balance Sheet & Cash Flow — FY2026

Total Assets

₹10,489 Cr

Total Liabilities

₹3,997 Cr

Cash & Equivalents

₹1,650 Cr

Operating Cash Flow

₹1,455 Cr

Capex

-₹185 Cr

Shareholding (proxy)

Institutional Holding

13.3%

Insider Holding

73.5%

Corporate Actions

Next Earnings

19 Oct 2026

Dividend Rate

₹58

Ex-Dividend Date

22 May 2026

Analyst Consensus

Recommendations

12 Buy · 13 Hold · 6 Sell

Target Price (Mean)

₹3,576.84

-3.9% vs CMP

Target Range

₹2,950 – ₹4,200

Peer Comparison

Company	P/E	ROE
TATA CONSULTANCY SERV LT	17.3x	45.6%
INFOSYS LIMITED	15.8x	32.0%
HCL TECHNOLOGIES LTD	20.4x	24.6%
WIPRO LTD	14.5x	15.9%

Recent News

1 mixed5 general

L&T Technology Services (NSEI:LTTS) Stock Forecast & Analyst Predictions

Simply Wall Street, 09 OctAnalyst view

🟡Mixed / dependsBroker commentary — an opinion about the price rather than new information about the business.

LTTS Outlook for the Week

Equitypandit, 09 Oct

L&T Technology Services - Concurrent Gainers: 15 stocks gain for 5 days in a row

The Economic Times, 17 Oct

L&T Technology Services Share Price Key Data: 19 August 2026

Univest, 19 Aug

LTTS launches AI-native manufacturing lab in India, plans US facility

Business Standard, 12 Oct

Stocks in Focus Today: Nykaa, Waaree, LTTS & More

HDFC Sky, 25 Sept

Watch Items

Cross-check against the company's latest quarterly filing / investor presentation before acting.
RSI is in overbought territory — momentum entries here carry more short-term pullback risk.

DalalBaazaar Thesis

StrongBusiness Quality · Financial Health

MiddlingProfitability · Risk

WeakGrowth · Valuation

Points for each in the Score ↑

Unremarkable in both directions

A reasonable business at a reasonable price. Nothing here is alarming and nothing is compelling, which usually means the decision rests on things this data cannot see — the industry's direction, management's intent, and what else is available to you. 2 high-severity red flags sit above this conclusion and should be read first.

All 5 tripwires holding · see Key things to watch ↑