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Informist, Tuesday, Jan. 13, 2026

By Arya S. Biju

MUMBAI – Steady performance in the sustainability segment, coupled with moderate growth in the technology vertical, is expected to drive a low single-digit sequential rise in the top line of L&T Technology Services Ltd. for the December quarter. However, the company's top-line growth is expected to be limited by continued weakness in its mobility business, according to brokerages. The company's operating margin, on the other hand, is expected to improve sequentially, supported primarily by the depreciation of the rupee against the dollar and by operational efficiency. 

The technology company that provides engineering, research and development services is expected to report a consolidated net profit of INR 3.41 billion for the reporting quarter, up around 4% sequentially, according to the average of estimates from 13 brokerages. This will be in line with the over 4% sequential rise in the company's bottom line in the previous quarter. On a year-on-year basis, the company's bottom line is expected to rise by around 6%, higher than the nearly 3% year-on-year increase it reported in the trailing quarter. 

The company's top line for the December quarter is expected to grow over 2% sequentially to INR 30.51 billion, according to the average of estimates. This is lower than the 4% sequential rise in consolidated net sales it reported in the previous quarter. On a year-on-year basis, the company's revenue is expected to grow by over 15%, slightly below the near 16% growth it reported in the previous quarter. 

The highest estimate for the company's consolidated net profit for the quarter is INR 3.56 billion by ICICI Securities Ltd. and the lowest is INR 3.22 billion by IDBI Capital Market Services Ltd. Meanwhile, Dolat Capital Market Pvt. Ltd. had the highest estimate at INR 31.08 billion for net sales of the company and Indsec Securities and Finance Ltd. had the lowest estimate at INR 30.30 billion. 

L&T Tech's revenue in constant currency terms for the December quarter is expected to grow 1.3–3.5%, according to estimates from five brokerages. Indsec Securities, however, expects the company's revenue in constant currency terms to remain largely flat or decline 1% sequentially, due to seasonal furloughs, softness in the mobility vertical, and the company's exit from low-margin business as part of its transformation plan. Dolat Capital, on the other hand, has the highest estimate of 3.5% sequential revenue growth, driven by steady deal ramp-ups. 

The company's earnings before interest and tax margin for the reporting quarter is expected to be 13.6-14.3%, according to estimates from 12 brokerages. In the September quarter, the company's EBIT margin had improved 10 basis points sequentially to 13.4%. The depreciation of the rupee against the dollar, absence of discounts extended to select clients, and favourable segment mix are expected to support the company's EBIT margin for the December quarter. 

Dolat Capital expects the company's operating margin to expand 37 bps sequentially, led by operational efficiency and operating leverage. HSBC Global Research expects the margin to expand by 40 bps on a quarter-on-quarter basis, driven by the company's resumption of billing for a key client in the semiconductor business and favourable currency movements. Indsec Securities expects the company's selling, general, and administrative expenses to be higher in the December quarter due to exited businesses, which will put pressure on its margins. On the other hand, Motilal Oswal Financial Services expects the optimisation of the company's selling, general, and administrative expenses to support the margins for the quarter.

The company's strong momentum from large deal wins is expected to continue in the December quarter, with total contract value exceeding $200 million, Kotak Securities said. "We expect the quality of deal wins to improve over the upcoming quarters," the brokerage said. In the trailing quarter, L&T Tech reported a record total deal contract value of around $300 million. 

While most broking firms expect the company to retain its double-digit revenue growth guidance for 2025-26 (Apr-Mar), Kotak Securities expects it to cut the guidance to around 8.5-9%. In the September quarter, the company said it aspires for a double-digit growth in FY26 and reiterated its medium-term revenue outlook of $2 billion.

L&T Tech will announce its December quarter earnings Thursday. Market participants will watch for management commentary on the 2026 technology budgets of US-based clients, the potential for an uptick in discretionary spending, and deal intake and pipeline trends. Management commentary on demand and outlook for growth across verticals will also be closely monitored by the Street, according to broking firms. 

Updates on the company's progress in rescaling margins to previous levels, the roadmap for building the software vertical, and the review of low-margin portfolio and tail accounts will also be watched for. Further, details regarding the transformational plan, deal ramp-ups, and future plans about existing businesses will also be monitored by the Street, brokerages said.

Tuesday shares of L&T Tech closed at INR 4,317.70 on the National Stock Exchange, up marginally from the previous close. The stock has risen nearly 4% since the company announced its September-quarter earnings on Oct. 17. However, it is still over 28% down from the all-time high of INR 6,000 reached on Aug. 30, 2024. 

Of the 14 research reports on the company available with Informist, five have a 'buy' or equivalent recommendation on the stock, with an average target price of INR 4,632, which is over 7% above Tuesday's closing price. Of the remaining nine, six have a ‘hold' or equivalent recommendation with an average target price of INR 4,603, indicating around 7% upside from the current market price and the rest have a sell or equivalent call on the stock. 

Following are the December quarter earnings estimates for L&T Tech from 13 brokerage firms in descending order of the estimate of net profit in INR million:

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US$1 = INR 90.19

Edited by Saji George Titus

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