Buy L&T Technology Services, target price Rs 2830: Motilal Oswal

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Buy L&T Technology Services, target price Rs 2830:  Motilal Oswal


Motilal Oswal has buy call on L&T Technology Services with a target price of Rs 2830. The current market price of L&T Technology Services Ltd. is Rs 2508.4.

L&T Technology Services Ltd., incorporated in the year 2012, is a Mid Cap company (having a market cap of Rs 24660.06 Crore) operating in IT Software sector.

Financials
For the quarter ended 31-12-2020, the company reported a Consolidated sales of Rs 1400.70 Crore, up 6.61 % from last quarter Sales of Rs 1313.80 Crore and down -1.56 % from last year same quarter Sales of Rs 1422.90 Crore Company reported net profit after tax of Rs 186.90 Crore in latest quarter.

Investment Rationale
Since the company’s listing in Sep’16, the P/E multiple (one-year blended forward) has averaged to c21x. The TP of INR 2,830 implies 26x FY23E EPS, c5% premium to the target multiple for L&T Infotech on better industry & company growth. It also anticipate improved industry spend environment compared to previous five years.


Promoter/FII Holdings
Promoters held 74.3 per cent stake in the company as of Dec 30, 2020, while FIIs held 8.9 per cent, DIIs 6.4 per cent and public and others 10.4 per cent.





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