l&t infotech ltd

L&T Infotech Ltd

15 MAR 2019

Initiating Coverage

Delivering Consistent growth !!

2

IT services

Price performance

Target Price: Rs 2,138

CMPPotential Upside

MARKET DATA

No. of Shares

Market Cap

Free Float

Avg. daily vol (6mth)

52-w High / Low

Bloomberg

Promoter holding

15 MAR 2019 Company Report

BUY

Rs. : 1,628: 31%

: 17.34 Cr

: 28,624Cr

: 25.16%

: 1,23,690

: Rs 1,990/1,270

:

: 74.84%

L&T Infotech

Shareholding patternFinancial Summary

Source: Company, Axis Securities CMP as on 15th Mar 2019

Y/EMarch

Sales(Rs Cr)

PAT(Rs Cr)

EPS(Rs )

Change(%)

P/E(x)

RoE(%)

RoCE(%)

DPS(Rs)

FY17 6,501 971 56.8 15.4 - 35.5 46.2 16.6

FY18 7,307 1,112 64.7 13.9 - 30.2 40.5 21.5

FY19E 9,510 1,526 88.0 47.2 19.3 33.0 46.0 35.7

FY20E 11,150 1,699 98.0 11.3 17.4 30.2 42.2 39.7

FY21E 12,831 1,952 112.5 14.9 15.1 28.9 40.7 47.6

Dec-18 Q-o-Q Change

Promoters 74.84 (0.16)

FPIs 7.84 (1.69)

MFs / AIF 7.04 1.43

Banks / FIs 0.33 0.02

Public (Others) 9.94 0.39

Kumar Nihal – Manager - Research | [email protected] | (+91 22 4267 1747)

Delivering consistent growth !!

80

130

180

Mar-18 Jun-18 Aug-18 Nov-18 Feb-19

Sensex L&T Infotech

LTI IN

3

Investment Rationale

We initiate coverage with “BUY” rating and a target price of Rs 2,138 i.e. 31% upside (implies 19x FY21E)

Increasing IT spend across industries for transformation through automation and digital. Worldwide IT spending is projected to total $3.8 trillion in 2019, an increase of 3.2% from expected spending of $3.7 trillion in 2018

Digital contribution to revenue is ~37% for LTI, growing at 8.9% CQGR vs. overall company growth of 4.5 % over last 8 quarters. Focus on digital business expansion via aiding capabilities would be key growth driver

Healthy offshore mix (~78%) enables LTI to execute big digital projects at large scale from offshore locations andfocus on operating lever (falling SG&A expenses) would help LTI margins to be higher among mid-cap IT companies

Large deal wins, effective client mining backed by a solid marketing and sales strategy gives LTI edge to be among the top quartile (among top two players) in terms of revenue growth going forward

Larsen & Toubro Infotech Limited (LTI) incorporated in 1997, a subsidiary of Larsen& Toubro Limited is a global technology consulting and digital

solutions company. LTI has global presence which includes 25 software development centers and 49 sales offices. LTI offers an extensive range of

IT services to its clients in diverse industries such as Banking & Financial Services, Insurance, Manufacturing, Energy & Utilities, Consumer

Packaged Goods, Retail and Pharma, High-Tech, Media & Entertainment. Its range of services include Application Development, Maintenance

and Outsourcing, Enterprise Solutions, Infrastructure Management Services, Testing and Digital Solutions. With operations in 30 countries and

headcount of 27,500+, LTI accelerates clients’ digital transformation with LTI’s Mosaic platform enabling their mobile, social, analytics, IoT and

cloud journeys. LTI enjoys the benefit of parentage. L&T group’s brand name and domain expertise available within group helps LTI in better

penetration and acceptability in the market. LTI is 6th Largest Indian IT companies and ranks amongst top 20 Global IT companies.

LTI has delivered double digit (YoY constant currency) revenue growth momentum over more than Eight straight quarters. We estimate

revenue/PAT to further grow at CAGR of 21% /21% respectively over FY18-FY21E driven by;

LTI’s focus is on revenue growth and investments in building next-gen services, acquisitions, platforms and talent. These investments would be supported by healthy operating cash flows.

L&T Infotech Ltd

Sector: IT services


4

Investment RationaleL&T Infotech Ltd

Sector: IT services


LTI has shown robust revenue growth. It has

consistently delivered double digit YoY revenue

growth for more than 8 straight quarters in

constant currency terms. The growth has been

broad based, across all the verticals,

geographies and set of clients. Revenue has

grown sequentially at CQGR of 4.5% in terms

of USD and CQGR of 5% in INR terms over

last 8 quarters. The growth has been broad

based led by BFSI, CPG Retail & Pharma. With

revenue growth in the top quadrant of the

industry and operating margins in high teens,

LTI is likely to sustain its industry leading

performance.

LTI in EBITDA margin of 20.6% during

Q3FY19 has shown strong improvement, up

380 bps from Q1FY18 driven by revenue

growth acceleration and operating leverage

aided by superior delivery mix. LTI has healthy

offshore mix at 78% (vs 75.7 % in Q3FY17),

helped by its global agile digital execution

engine which has created the differentiation

factor. The utilization level (excluding trainees)

of 83% is at its peak level and management

expects it to come down resulting in margins

slippage of around 100 bps. However,

management is confident of maintaining PAT

margin of ~15% going ahead.

Digital revenue in USD term grew at a CQGR of

8.9 % vs. company growth of 4.5 % over last 8

quarters. Digital constitutes 37% of Q3FY19

revenue and 43% of current deal pipeline. LTI

has broad based digital capability and its key

digital service lines includes Analytics, AI &

Cognitive and Enterprise Integration & Mobility

together constituted 12.9% in Q1FY17 and

stands at 18.9% in Q3FY19. Growth in digital

revenue account would continue its uptrend with

increasing demand and LTI’s continuous focus

on strengthening its Digital capabilities. Margins

in digital business are higher. Offering such as

MOSAIC (IP based platform) & ADEA aimed at

increasing the presence of newer-age

technologies in every account would be the key

to LTI’s growth.

Consistent growth High MarginsDigital driving growth Consistent Growth High MarginsDigital Driving Growth

5

Investment RationaleL&T Infotech Ltd

Sector: IT services


Investments aiding capabilities

LTI’s focus is on revenue growth, with steady

investments in building next-gen services,

acquisitions, platforms and talent. In 2019, LTI

announced two acquisitions:

Ruletronics: A boutique Pega consulting

company providing innovative BPM and

CRM solutions that enables businesses to

transform and evolve digitally

Nielsen + Partner: Implementation specialist

for the Temenos WealthSuite providing

services around digital banking platforms

This is the fourth acquisition since listing

focused on augmenting LTI’s digital

capabilities and addressing the white

spaces in portfolio. LTI would continue to

invest and be proactive in hiring talent

across US and India.

Robust IT spend

Worldwide IT spending is projected to total

$3.8 trillion in 2019, an increase of 3.2 %

from expected spending of $3.7 trillion in

2018. IT spending will remain high during the

next two years as demand for the digital

transformation and automation remains

high. Cloud computing segment would grow

by 22% in next two years which is highest

among all other verticals. LTI’s resilience

underpinned by superior execution, higher

digital penetration and prudent strategy of

targeting niche segments within each vertical

positions it to reap the benefits of this

increasing IT spend across geographies.

LTI has steadily been able to secure large deal

wins over the past few quarters. LTI has 63

Fortune-500 clients (2 addition during Q3FY19),

recently LTI won a large deal from one of its

existing client ‘Nets’ (leading payments player

in Nordic region), the deal was won against a

slew of large tier-I players. LTI has proactively

realigned its focus on top 21-50 clients through

strategic programs such as “Minecraft” and

“Analytics and Digital in Every Account

(ADEA)”. Healthy deal pipeline and ramp-up of

large deals and mining of new logos (won in

FY18/FY19) would help sustain the growth

momentum over FY20.

Large deal wins & Client Mining Investments Aiding Capabilities Robust IT SpendLarge Deal Wins & Client Mining

6

Management

Has over 25 years of experience in the IT industry. Prior to joining LTI, he worked at Infosys Limited as the Executive Vice President and GlobalHead of High-Tech, Manufacturing and Engineering Services. He also served as a member of the Board of Lodestone Holding AG and has alsochaired the Board of Infosys Technologies (China) Company Limited and Infosys Technologies (Shanghai) Company Limited.

Mr. Sanjay Jalona, Chief Executive Officer & Managing Director

Brings rich experience of more than 23 years of experience in delivery, customer relationship, account and P&L management across verticals,technologies and Geographies in technology and IT industry and last served as the Senior Vice President & Global Delivery Head for the Bankingand Financial Services unit at Cognizant Technology Solutions.

Mr. Nachiket Deshpande, Chief Operating Officer

Has over 24 years of experience in the areas of strategic financial planning, treasury and finance and accounts in various industry verticals.Previously, he has worked at senior finance positions in L&T Power IC, Greaves Cotton Limited and Tata Group Companies – Tata Inc (USA), andTata Chemicals Limited

Mr. Ashok Kumar Sonthalia, Chief Financial Officer

He joined LTI in September 2016. Prior to this he was the Chief Operating Officer at NIIT Tech, responsible for global sales and delivery of alltechnology and business services. Before this, he worked with Infosys in several roles, the last being responsible for heading Financial Services inAmericas; and the others including Head of UK, Head of Sales for Europe and Head of Manufacturing vertical for Europe

Mr. Sudhir Chaturvedi, President – Sales

He joined LTI in 2015 and has been leading marketing organizations since 1999. Prior to this, he has worked with Mindtree, Infosys, iGate andIDS NEXT.

Mr. Peeyush Dubey, Chief Marketing Officer

L&T Infotech Ltd

Sector: IT services


7

LTI story

2019

1997

2018

2002

2017

2004

2016

2007

2015

2008

2014

2010

Commercial Operations as a subsidiary of L&T

Achieved SEI CMM-LS Certification

1st Large Multi-Year contract from a Global Energy Company

1st Acquisition- US based GDA Tech Inc.

Established business in South Africa

Acquired Transfer Agency businines unit of Citigroup Fund Services Canada

CMMi v1.2 L5 Certification for all DeveopmentCenters

Focus on Manufacturing and Services Sectors

Syncordisacquisition in Nov’17

Acquired ISRC from Otis Elevator Company

Acquired Ruletronics and Nielsen+Partner

Inaugurated experience theatre for Oracle Technologies in the US

Positioned in top 20 IT Services Providers by Everest Group

Initial Public Offerings (IPO)

Acquired AugmentIQ

Tops the ‘Challengers’ List in Everest Group’s PEAK Matrix Service Provider of the Year 2018

L&T Infotech Ltd

Sector: IT services


8

31%

28% 11%8%

11%

8%3%

Application DevelopmentMaintenanceEnterprise Solutions

Infrastructure ManagementServicesTesting

Analytics,AI & Cognitive

Enterprise Integration &MobilityPlatform Based solutions

Extensive range of Services

L&T Infotech Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19

Application Development Maintenance 38.5% 38.2% 36.3% 36.4% 36.2% 34.6% 33.5% 32.8% 34.0% 32.0% 30.8%

Enterprise Solutions 24.1% 23.0% 23.2% 23.6% 22.9% 24.1% 26.4% 27.0% 26.3% 25.2% 27.8%

Infrastructure Management Services 10.6% 10.4% 11.4% 11.4% 12.3% 10.9% 10.8% 11.7% 11.5% 11.7% 11.4%

Testing 9.9% 9.5% 9.0% 9.1% 9.0% 8.9% 8.3% 8.4% 8.1% 7.9% 7.8%

Analytics, AI & Cognitive 7.3% 8.7% 9.6% 9.5% 9.7% 10.9% 10.8% 10.7% 10.3% 12.2% 11.3%

Enterprise Integration & Mobility 5.6% 6.2% 6.6% 6.0% 6.4% 6.8% 6.7% 6.5% 6.5% 8.0% 7.6%

Platform Based solutions 4.0% 4.0% 4.0% 3.9% 3.6% 3.8% 3.5% 3.1% 3.1% 3.0% 3.2%

Revenue contribution by services: Increasing share of key digital offering services

High exposure to ADM and ESOffering complete solution to focused customer base

L&T Infotech Ltd

Sector: IT services


DigitalSolutions

InfrastructureManagement

Services

Platform-based

Solutions

EnterpriseSolutions

Application Management

Testing & Validation

Mosaic

Big Data

LOT

EnterprisesIntegration

CognitiveComputing

BusinessFirstMethodology

CommandcentricGlobal

Operations

Tech & OpsTransformation

Data CentredCodified

SaaS Based

TransferAgencySolutions

SAP

Oracle

Microsoft

Salesforce

ApplicationDevelopment

ApplicationMaintenance

&Support

ApplicationOutsouring

CoreTesting

TestAdvisory

SpeciazedTesting

(ADM)(ES)

Source: Company, Axis Securities

These two keydigital servicelines has grownat a 8.2%CQGR vs 4.1%overall CQGR

9

7587

97 102 109122 128

29%32% 33% 33% 34% 37% 37%

0%

10%

20%

30%

40%

020406080

100120140

USD

mn

Digital Revenue (USD mn) Revenue Share (%)

Digital presence across verticals & services, led by ADEA approach

Digital revenue in USD term grew at a CQGR of 8.9 % vs. companygrowth of 4.5 % over last 8 quarters. Digital revenue contributionwas at 37% during Q3FY19 (vs 22% in Q1FY18) which has beenthe key driver for LTI’s growth.

Margins from digital services are significantly higher than company’soverall margin except for Unitrax (Product platform for Capital market& Wealth Management segment).

LTI introduced MOSAIC (acronym for Mobile, Social, Analystics, IoTand Cloud), a comprehensive digital offerings with its own product IP(MaxIQ platform acquired through AugmentIQ) in FY18. It offers IoT,Automation, Decision Science, artificial intelligence and Digitalcustomer experience solution suits. ServiceFirst, ProcureFirst,CampusNext, @assurePro etc are few other digital platforms.

ADEA approach: Analytics and Digital in every account is LTI‘sapproach of client mining by dedicating account manager andtargeting & selling more of new technologies to every customer.

There would be a sharp uptick in digital contribution as pure-playlegacy business would extinct in future and the exponentialtechnologies (Digital) would become the trend of doing business.

Digital constitutes 43% of current deal pipeline. LTI has broad baseddigital capability and its key digital service lines which includeAnalysics, AI & Cognitive and Enterprise Integration & Mobilitytogether constituted 12.9% in Q1FY17 and stands at 18.9% inQ3FY19, growing at 8.2% CQGR. Going forward, growth in digitalrevenue account would continue its uptrend.

Digital to be the new norm

Key digital service line YoY growth

47%

40%

33%36%

32%37%

26%27%24%

18%

26% 26%

43%

37%

10%

20%

30%

40%

50%

Analytics,AI & Cognitive Enterprise Integration & Mobility

L&T Infotech Ltd

Sector: IT services


Digital constitutes 43% of current deal pipeline


10

-20%

0%

20%

40%

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1000

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3000

Rs

cr

Revenue (Rs) QoQ growth (%) YoY growth(%)

0%

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30%

CC QoQ growth (%) CC YoY growth (%)

0%5%10%15%20%25%30%35%

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Revenue (USD) QoQ growt (%) YoY growth(%)

Broad based revenue growth

LTI has shown robust revenue growth over last 2-3 years. It hasconsistently delivered double digit YoY revenue growth for morethan 8 straight quarters in constant currency terms. The growth hasbeen broad based across all the verticals, geographies, and setof clients

Revenue has grown sequentially at CQGR of 4.5% in terms ofUSD and CQGR of 5% in rupee terms over last 8 quarters

LTI grew over 20% in BFS, Energy & utility, CPG, Retail & Pharmaduring FY18. The momentum continued during 9MFY19 and thesame is likely to continue for Q4FY19 and FY20. Among theseverticals, BFS bounced back after sluggish Q2 while CPG, Retailand Pharma continued to drive growth supported by ramp up of 2large deals earlier this financial year

Among services lines, Enterprise solutions, Analytiics, AI &Cognitive and Enterprise Integration & Mobility would be majorfocus driving the growth

This industry leading growth was due to its focus on select sub-verticals where it specializes in terms of domain knowledge andcapabilities

For example: LTI has strong presence in the Capital market verticalwith Banking and Financial segment, property and casualty within

insurance space. Similarly other verticals witness LTI’s niche focuswhich is helping the company grow

Management is confident of being at the top quartile of revenuegrowth for FY20 on the back of strong deal pipeline (USD 1bn+),large deal wins during FY18/FY19, and demand momentum.

Double digit revenue growth (Constant currency) Consistently delivering double digit YoY growth

Revenue growth (USD)

Revenue growth (Rs)

L&T Infotech Ltd

Sector: IT services



11

-10%

0%

10%

20%

30%

40%

50%

0

20

40

60

80

100

120

USD

mn

BFS (USD) QoQ growth (%) YoY growth (%)

Banking & Financial Institutions (BFS) riding the tech wave

BFS is largest contributor to LTI’s revenue (~29%) with niche focuson Wealth Management and Capital Markets.

The BFS segment has shown phenomenal growth on the back ofincrease in IT spend by traditional Banking institutions in order toremain competitive with Fintech firms which has led to the norm of‘distrupt or be distrupted’. LTI is getting positive traction in thewealth space, where there is a significant surge in activity.

BFS, which contributed USD 64 mn in Q3FY17, has contributedUSD 101 mn in Q3FY19, growth of 6% CQGR. Even though fewaccounts witnessed tightness in spend during Q2, the managementis confident of segment’s rapid growth in future.

In North America, LTI is helping a global Fintech firm to build asuite of digital Wealth Management solutions. The digitaltransformation of the client would involve deployment of microservices and API architecture and migration of 200 applications tocloud. This incidentally also happens to be the new account that LTIopened last quarter.

In Europe, acquisition of Syncordis is helping LTI build a wealthmanagement platform that would have the ability to operate as abank. LTI's platform will provide an end-to-end solution.

Large banks in North America are increasing IT spend followingrise in interest income and tax cuts. Better financial health of clientsis fueling spends, improving discretionary spends.

Economic turnaround in USA along with major developed countries will lead to Basel IV implementation ensuring higher IT spend by BFSI

Strong traction in wealth spaceHigh concentration in BFS to continue

29%

18%

16% 11%

11%

11%

5%

BFS Insurance Manufacturing

Energy & utilities CPG, Retail & Pharma High-tech, Media & Ent.

Others

L&T Infotech Ltd

Sector: IT services


Revenue breakup (by Vertical - Q3FY19)


12

-6%

0%

6%

12%

18%

0

10

20

30

40

50

60

70

USD

mn

Insurance (USD) QoQ growth (%) YoY growth (%)

Insurance, Energy and Utility: Tepid growth

Growth in Insurance vertical has slowed down, however given theopportunity available and strong domain expertise available withLTI, growth would gain momentum in future.

LTI focuses on Property & casualty within Insurance segment and ispart of DuckCreek’s global alliance programme. LTI has range ofsolutions for Insurity, Duckcreek & Guidewire.

IPs in Insurance include AccuRUSI (framework for transformingunderwriting capabilities for insurance companies) and iCEOn(cloud-based Employee Benefits Management solution for brokers).LTI collaborated with ACORD to develop a comprehensive set of

digital standards & solutions.

Insurance companies to increase IT spend Insurance: Focused effort to accelerate growth

Energy & Utility (E&U) witnessing revivalHeadwinds behind for E&U

There has been significant reduction in revenue contribution from

E&U vertical over last few years owing to fall in crude oil prices.

(22% in FY14 to 11.7% in FY18)

From 2018, LTI observed energy companies starting to prioritize

digital transformation and expects the trend play out well as oil

prices firm up.

Given the volatility in crude oil prices, energy clients continue to

evaluate their capital spend with prudence to manage their

profitability. Firm crude oil prices would ensure higher spends by

Oil & Gas companies thus leading to improvement in E&U vertical

for LTI

L&T Infotech Ltd

Sector: IT services



-30%

-15%

0%

15%

30%

05

10152025303540

USD

mn

Energy & Utilities (USD) QoQ growth (%) YoY growth (%)

13

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15%

30%

45%

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10

15

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25

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35

40

USD

mn

CPG, Retail &Pharma (USD) QoQ growth (%) YoY growth (%)

Growing segments

This vertical posted strong sequential growth during 9MFY19

powered by ramp-up of large deals announced in 1QFY19 and

2QFY19.

Strong growth in this vertical was a function of four factors (1)

growth from large accounts, (2) focus on must-invest accounts, (3)

contribution from large deals and (4) opening of new accounts.

This vertical is expected to continue its uptrend in coming

quarters.

CPG, Retail & Pharma

Hi-Tech, Media & Entertainment

Media is one of the industries getting disrupted the most. The

advent of new technologies have flooded the market with new

players and blurred the lines between telecom, media and high-

tech companies.

Media companies are forced to reimagine both their business

models and their systems to align to new market and digital

realities.

LTI is partnering with ad media and entertainment clients to

envision and enable this transformation, leveraging their

technologies, including analytics, AI, cloud, automation and user-

centric designs.

CPG, Retail & Pharma: Uptick in demand

Hi-Tech, Media & Entertainment: Leveraging technologies

L&T Infotech Ltd

Sector: IT services


-15%

0%

15%

30%

45%

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1015202530354045

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Hi-tech, Media & Ent. (USD) QoQ growth (%) YoY growth (%)


14

0%

20%

40%

60%

80%

100%

North America Europe RoW India

67%

17%

9%

8%

North America Europe RoW India

Presence across Geography

LTI’s geographic revenue contribution is diversified and imitates the

trends of Tier-I IT companies. During Q3FY19, North America

contributed ~67% of the total revenue followed by Europe with

17%, India contributed 8% and Rest of the World together

contributed 8%.

In FY18, North American business contributed US$770mn and

grew at 4.1% CQGR over the last eight quarters while Europe

business contributed US$ 203.8mn and has grown at 3.3% CQGR

over the last 8 quarters.

RoW contributed US$76mn (CQGR of 11.1% over 8 quarters) and

India contributed US$82.1mn (CQGR of 4.1% over 8 quarters).

These two geographic segments are growing at rapid pace

indicating adoption of new age technologies globally.

Within European region, LTI is focused in Germany, France and

Nordic region organically as well as inorganically. LTI is also

focused in Australia, Singapore, Japan, South Africa, India &

Middle-east on the back of L&T’s parentage especially in

construction, O&G and transportation vertical.

Company has cracked a landmark project in India (CBDT) of

US$100mn.

India business growth has been volatile due to project-based

business growth which would continue to depend on the projects

cycle.

Large part of revenue comes from North America Improving Geographic Mix

Geographic expansion beyond US & Europe

L&T Infotech Ltd

Sector: IT services



15

38% 39% 38% 38% 36% 35% 37% 36% 35%

52% 53% 51% 51% 51% 50% 50% 50% 48%

68% 68% 66% 66% 66% 65% 66% 66% 64%

20%

40%

60%

80%

Top 5 Top 10 Top 20

Large deal wins, sustained client mining to drive FY20

LTI has 63 Fortune-500 clients and has been able to secure largedeal wins steadily over the past few quarters. It added two Fortune500 clients (BFSI, Automotive segment) during Q3FY19. Fortune500 clients has propensity to drive improved revenue momentumand visibility as these clients have higher tendency to spend in agood macro condition.

LTI recently won Nets (leading payments player in Nordic region)deal against a slew of large tier-I players from US, Europe andIndia.

LTI has proactively realigned its go-to-market strategy focus on top21-50 clients to mine well through strategic program such as“Minecraft” and “Analytics and Digital in Every Account (ADEA)”along with the “Wild dogs Hunting pack” sales strategy which hasbeen the cornerstone to LTI’s success in targeting must have logosand increasing market share vis-à-vis large tier-I vendors

LTI’s clientele includes CitiGroup, CBDT India, Nordia, HartfordSteam Boilers, ELKJOP, Chevron, Barclays, Time Warner Honda,OTIS Elevator Company etc.

Higher client concentration leads to higher risk however better top-10 accounts mining has generated higher delta for LTI, as theycontribute little less than 50% of the total revenue (48% inQ3FY19). Top-20 accounts contributed 64% of the total revenue inQ3FY19 which was 68% in Q1FY17 indicating focus of reducingrisk of dependence on top clientele.

Client profileQ1

FY18Q2

FY18Q3

FY18Q4

FY18Q1

FY19Q2

FY19Q3

FY19

Active clients 256 256 289 300 301 312 314

New clients 12 13 17 15 19 22 17

1 mn + 97 99 102 109 114 114 121

5 mn + 35 39 43 44 42 44 47

10 mn + 24 23 22 23 25 25 25

20 mn + 12 12 13 13 13 14 15

50 mn + 4 4 4 4 4 4 5

100 mn + 1 1 1 1 1 1 1

Opening New Logos (Clients)

Reduction in Client concentration Deal Wins: An exemplar of Marketing & Sales strategy

L&T Infotech Ltd

Sector: IT services



16

75.7% 76.0% 76.2%76.7% 76.5%

76.9% 77.0%77.4%

78.0%

74%

76%

78%

80%

Offshore

77.7%

79.6%80.3% 79.9% 79.7%

80.4%

82.1%78.2%

80.7%81.5% 81.1% 81.2%

82.3%83.0%

74%

76%

78%

80%

82%

84%

Including trainees Excluding trainees

Efficient Employee metrics

While other industry players have been increasing their onsite

effort mix, LTI has healthy offshore mix of 78% (vs 75.7 % in

Q3FY17), helped by LTI’s global agile digital execution engine

which has created the differentiation factor for LTI.

This positively skewed offshore mix is the reason behind LTI’s ability

to execute big digital projects at large scale from offshore locations

and subsequently earn better margins

Offshore Leverage

LTI investment in hiring to continueUtilization at peak

Effort mix: The differentiating factor

1298

233

840745

1011

1264

1099

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1400

L&T Infotech Ltd

Sector: IT services



17


13%

14%

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16%

17%

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400

500

Rs

cr

PAT PAT (%)

0%

5%

10%

15%

20%

25%

0

200

400

600

Rs

cr

EBITDA EBITDA (%)

17% 17%

16%16% 16%

15%14%

12%

14%

16%

18%

20%

Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19

SG&A (%)

Margins- Winners in mid--cap IT

LTI in EBITDA margin of 20.6% during Q3FY19 has shown strongimprovement, up 380 bps from Q1FY18 driven by revenue growthacceleration and operating leverage

Utilisation level of 83% is at its peak and might not sustain at thislevel, subsequently management expects margins slippage of notmore than 100bps in near term.

However, irrespective of slight operating level slippage due toincrease in onshore expense and expected fall in utilization levels,focus would be on managing other operating levers such asSelling, General & Administration expense (SG&A) and hedgingstrategy of the company. Management is confident of maintainingstable net profit margin of ~15%.

EBITDA margin expansion led by operating leverages

Management guidance for ~15% PAT margin Headwinds may lead to 100bps margin slippage

SG & A expenses dropped

L&T Infotech Ltd

Sector: IT services


* Not adjusted for one time client settlement

*

*

18

0

200

400

600

(Rs

Cr)

Strategic acquisitions to aid capabilities

L&T Infotech (LTI) through its German subsidiary will acquire N+P

headquartered in Germany. The acquisition will augment LTI’s

Temenos (Top software provider for banks and financial

services) capabilities.

N+P is a global implementation specialist for the Temenos

WealthSuite which provides services around digital banking

platforms to customers across Banking and Financial services

segment. It has an approved Temenos partner status both for

EMEA and APAC Regions.

This is an all cash deal for Euro 28 mn (EV/sales: 3.2x) and is

expected to close by March’19.

LTI announced acquisition of Ruletronics, a boutique Pega

consulting company with customers in banking, insurance,

healthcare and retail verticals.

The acquisition will strengthen LTI’s digital business with a suite of

capabilities in Pega implementation in establishing BPM roadmap

& strategy, customer services, RPA and decision making.

The deal value amounted to USD 7.5 mn (EV/sales: 2.2X FY18).

The transaction is expected to be closed by March’19.

NIELSEN+PARTNER (N+P): To augment Temenos capabilities

Ruletronics: To strengthen Pega implementation

Operating Cash flows to support acquisitions

L&T Infotech Ltd

Sector: IT services


66

67

68

69

70

71

72

73

74

75

76

Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19

(Rs

Cr)

DSO to come down


Focus onimprovingunbilled DSOhas led togood cashflowgeneration.

LTI’s improvedits billed andunbilled DSOby 2 days and7 days resp.

DSO= Days sales outstanding (billed)

19

Previous Acquisitions

Syncordis S.A (FY18) LTI acquired Syncordis S.A., a leadingcore banking implementation services provider, along with itsidentified subsidiaries in France, UK, Luxembourg and India.Syncordis specializes on Temenos Digital Suites and hassuccessfully embedded its strong presence in Europe. Theacquisition helped LTI strengthen its presence in core bankingspace. The acquisition was completed in 2017 and LTI paidEuro 17.7 mn for the same. Its clients include StandardChartered, Julius Baer, Nordea, DNB, East West United Bank.

AugmentIQ (FY17) LTI acquired AugmentIQ Data SciencesPrivate Limited (AugmentIQ), an innovative startup offering IP-based Big Data Analytics Solution that helps enterprises derivebusiness benefits from Big Data. LTI has paid INR 70 mn for theacquisition. This acquisition has helped LTI to access MAXIQand proprietary identity resolution technology. Company hasembedded MAXIQ into its MOSAIC design platform and hasimproved its offerings which has already benefitted cross-sellingto its clients.

Information Systems Resource Centre (ISRC) was softwaredevelopment solutions provider. It was acquired from OtisElevator Company, USA and Otis Elevator Company, India(Unites of United Technologies Corporation) in FY15. DuringFY15, ISRC reported a topline/bottomline of Rs. 565mn/Rs.130mn respectively and had 287 employees. LTI has not onlyupdated technological capabilities but has also strengthened itsrelationship with Otis Group.

The Company has signed strategic partnerships with large OEMs.It has also created 360-degree relationships with a select fewpartners, viewing them as Global growth engines. The Companyhas defined joint go-to-market strategies, enhanced capacity andreadiness and proliferated best practices across clients throughthese partnerships.

LTI over the years has forged alliances with SAP (IntelligentConstruction), AWS (ECNO on EWS), Microsoft (MOSAICDecision), MicroFocus (Cognitive Business Assurance), IBM(Cognitive Claims), Salesforce, Mulesoft, Adobe (DigitalExperience) etc.

The alliance model has helped build a strong deal pipeline of USD250 mn+ (proposal stage USD 100 mn+) as partners chose LTI astheir top system integrators (e.g. LTI is one of top SIs recommendedby SAP for its select products).

New partnership include Coupa, Pega, Predix, Workfusion,Workplace, Nutanix.

Citi Group Fund Services Canada was acquired in 2011 and wasrenamed to L&T Infotech Financial Services Technologies (LTIFST). Itspecializes in proprietary software products and solutions.Business Intelligence solutions provide an enterprise informationplatform for Web-reporting and analysis.

Partnership and Alliances augmenting growth

L&T Infotech Ltd

Sector: IT services


20

IT Industry Analysis

Inter-firm Rivalry (High)

Around 200 large andmedium players togethercontribute 80% of total ITrevenues

Bargaining Power of Buyers (Increasing)

Multiple vendors available both inIndia as well as globally

Dynamic need of buyers requirecustomization of work

Threat of New Entrants (Moderate)

MNC’s are entering the ‘offshore’business aggressively

Margins improves with scalability:Small players are not major threat toincumbents

Bargaining Power of Suppliers (Increasing)

Intense competition in the recruitmentmarket with limited talent

Wage pressure and high attrition Regulatory pressure to hire high cost

local talent in US

Threat of Substitutes (Moderate)

Rapid technological changes Emerging economies can be

substitute places for ‘offshoring’ China, Brazil and Russia are

growing

L&T Infotech Ltd

Sector: IT services


21

SWOT Analysis: LTI

Strengths

Micro vertical focus

High domain knowledge

Large deal wins

IP based platforms

Strong Cash flows

Weaknesses

High Client Concentration

High geography concentration

Opportunities

Increasing need for digital solution

Mining existing and new clients

Opportunity to enter new

verticals/sub verticals

Building new capabilities

Threats

Slowdown in IT spend

Increasing competition

Currency fluctuations

L&T Infotech Ltd


Sector: IT services

22

20%

18%19%

16%

20% 20% 20%

15%14% 15% 15% 16% 15% 15%

0%

5%

10%

15%

20%

25%

FY15 FY16 FY17 FY18 FY19E FY20E FY21E

EBITDA (%) PAT (%)

Healthy Operating cash flows to support Investments

Key Financials

Revenue to grow at a CAGR of 21% over FY18-21E

L&T Infotech Ltd



Sector: IT services

Profitability focused growth

Margins to remain stable

5846 65017307

951011150

12831

0

4000

8000

12000

16000

FY16 FY17 FY18 FY19E FY20E FY21E

Rs

Cr

*

* Not adjusted for one time client settlement

*

0

400

800

1200

1600

2000


Rs

Cr

10251230 1187

1929

2278

2615

836971

1112

15261699

1952

0

500

1000

1500

2000

2500

3000


Rs

Cr

EBITDA PAT

23

Key Financials

Healthy return ratios

Shareholding – Parentage benefit (L&T group)

L&T Infotech Ltd



Sector: IT services

Dividend Payout Ratio

Robust growth in EPS expected over FY18-21E

17%

35%

41% 40% 42%

0%

10%

20%

30%

40%

50%

FY17 FY18 FY19E FY20E FY21E

75% 8%

7%

0%7%

3%

Promoters FPIs MFs / UTI Banks / FIs Public Others

Core RoCE: Return adjusted for cash reserves (expected to utilize for acquisition)

47.7 49.256.8

64.7

88.098.0

112.5

0.00

20.00

40.00

60.00

80.00

100.00

120.00

FY15 FY16 FY17 FY18 FY19E FY20E FY21E

Rs

35.530.2 33.0 30.2 28.9

38.8 36.4

50.7 48.2 48.2

0.0

20.0

40.0

60.0

FY17 FY18 FY19E FY20E FY21E

%

RoE (%) core RoCE (%)

24

We estimate LTI to post revenue/PAT growth at a CAGR of

21%/21% respectively over FY18-21E. It has given

consistent double digit cc growth (YoY) for more than 8

straight quarters ending Q3FY19 and would continue to be

among top quartile (among top 2 player) in terms of growth

We value LTI at 19x FY21E given the growth prospects on

the back of strong client mining, opening of new logos

(Clients), L&T’s parentage benefit and focus on acquiring

capabilities to arrive at a target price of Rs 2,138

(31% upside).

0

500

1000

1500

2000

2500

Jul-1

6

Sep

-16

Nov-

16

Jan-

17

Mar-1

7

May-

17

Jul-1

7

Sep

-17

Nov-

17

Jan-

18

Mar-1

8

May-

18

Jul-1

8

Sep

-18

Nov-

18

Jan-

19

Mar-1

9

(In

Rs)

Price 5x 10x 15x 20x

Valuation Charts


PE Band

12mth fwd P/E (x)

L&T Infotech Ltd


Sector: IT services

Valuation

Key Risks and Concerns

Fluctuations in key currencies like USD, GBP, INR will impact

revenue performance as majority of the revenue comes from

international territories.

Rapidly changing technology and increasing competition

pose client retention challenges

High client concentration: Tightness in top clientele spend

may have a direct impact on LTI’s growth

Margins could be impacted due to rise in local hiring in US

and more than expected fall in utilization.

0

5

10

15

20

25

Jul-1

6

Sep

-16

Nov-

16

Jan-

17

Mar-1

7

May-

17

Jul-1

7

Sep

-17

Nov-

17

Jan-

18

Mar-1

8

May-

18

Jul-1

8

Sep

-18

Nov-

18

Jan-

19

Mar-1

9

(In

Rs)

PE Mean Mean+1Stdev Mean-1Stdev

25

Other Metrics

Q1FY17 Q2FY17 Q3FY17 Q4FY17 Q1FY18 Q2FY18 Q3FY18 Q4FY18 Q1FY19 Q2FY19 Q3FY19

Revenue by Geography

North America 69.4% 68.9% 68.4% 68.6% 64.7% 70.4% 67.3% 66.0% 66.6% 67.4% 66.8%

Europe 18.0% 18.4% 18.3% 18.1% 17.8% 17.5% 18.0% 18.6% 17.9% 17.1% 16.7%

RoW 6.9% 6.8% 5.3% 5.7% 6.3% 6.7% 6.4% 7.4% 9.1% 9.2% 8.8%

India 5.7% 5.9% 8.0% 7.5% 7.1% 5.5% 8.4% 8.0% 6.4% 6.4% 7.8%

Client Contribution to revenue

Top 5 36.7% 37.1% 38.3% 38.5% 38.1% 38.0% 36.4% 35.2% 36.6% 36.2% 34.5%

Top 10 51.3% 51.8% 52.1% 53.1% 50.9% 50.9% 50.8% 49.6% 50.3% 49.9% 48.4%

Top 20 67.7% 67.6% 68.3% 68.0% 66.3% 66.0% 66.1% 65.1% 66.0% 65.5% 64.3%

Revenue by Vertical

BFS 25.2% 26.0% 26.0% 26.9% 26.8% 27.3% 27.1% 28.7% 30.9% 29.9% 29.1%

Insurance 21.9% 21.4% 20.8% 20.7% 20.6% 20.6% 19.4% 18.3% 18.2% 17.9% 17.8%

Manufacturing 18.1% 18.0% 17.8% 19.1% 16.6% 16.0% 17.2% 17.3% 15.7% 15.4% 15.6%

Energy & utilities 11.3% 10.8% 11.3% 11.1% 11.7% 12.0% 11.8% 11.5% 10.1% 10.7% 10.8%

CPG, Retail & Pharma 8.1% 7.8% 8.0% 8.2% 8.5% 9.0% 9.2% 9.0% 9.1% 10.2% 10.6%

High-tech, Media & Ent. 11.2% 10.7% 10.5% 10.2% 10.5% 11.1% 10.6% 10.6% 11.3% 11.2% 11.3%

Others 4.3% 5.3% 5.7% 3.9% 5.3% 4.0% 4.6% 4.6% 4.5% 4.7% 4.6%

Revenue Mix

Onsite 48.3% 48.1% 47.7% 48.7% 46.8% 46.6% 46.2% 45.7% 46.8% 47.6% 47.8%

Offshore 51.7% 51.9% 52.3% 51.3% 53.2% 53.4% 53.8% 54.3% 53.2% 52.4% 52.2%

L&T Infotech Ltd

Sector: IT services



26

Financials (Consolidated)

YE March FY17 FY18 FY19E FY20E FY21E

Net sales 6,501 7,307 9,510 11,150 12,831

Other operating income 0 0 0 0 0

Total income 6,501 7,307 9,510 11,150 12,831

Employee Expense 3,715 4,329 5,497 6,406 7,378

Contribution (%) 42.8% 40.8% 42.2% 42.5% 42.5%

Other Expenses 1,555 1,790 2,084 2,466 2,838

Operating Profit 1,230 1,187 1,929 2,278 2,615

Other income 187 426 267 139 160

PBIDT 1,417 1,614 2,196 2,418 2,776

Depreciation 178 156 142 139 160

Interest & Fin Chg. 3 16 10 6 6

Pre-tax profit 1,236 1,442 2,044 2,273 2,611

Tax provision 265 329 518 574 659

Profit After Tax 971 1,112 1,526 1,699 1,952


Total assets 3,791 4,617 5,427 6,391 7,451

Net Block 542 686 843 1,103 1,343

CWIP 0.9 1.0 3.0 4.0 4.0

Investments 217.7 110.9 110.9 110.9 110.9

Wkg. cap. (excl cash) 2,650 3,455 3,898 4,391 4,784

Cash / Bank balance 379.5 363.3 571.9 782.3 1,208.2

Capital employed 3,791 4,617 5,427 6,391 7,451

Equity capital 17.1 17.2 17.2 17.2 17.2

Reserves 3,127 3,843 4,750 5,761 6,887

Pref. Share Capital 0.0 0.0 0.0 0.0 0.0

Minority Interests 0.8 1.3 1.3 1.3 1.3

Borrowings (Short+Long term) 628 743 643 593 523

Def tax Liabilities 17.1 13.2 15.9 19.6 23.2

Profit & Loss (Rs Cr) Balance Sheet (Rs Cr)

L&T Infotech Ltd


Sector: IT services


27

Financials (Consolidated)


Sources 1,146 972 1,052 1,103 1,269

Cash profit 1,152 1,284 1,678 1,844 2,117

(-) Dividends 198 364 619 688 826

Retained earnings 954 921 1,059 1,156 1,291

Issue of equity 0.1 0.1 0.0 0.0 0.0

Change in Oth. Reserves 251.5 (38.4) 0.0 0.0 0.0

Borrowings (Long term) 0 104 0 (50) (20)

Others (60) (14) (7) (3) (2)

Applications 1,146 972 1,052 1,103 1,269

Capital expenditure (83.1) 346.2 300.0 400.0 396.0

Investments 1,072.8 216.9 0.0 0.0 0.0

Net current assets (20.1) 425.5 543.0 604.3 588.4

Change in cash 176.0 (16.2) 208.6 98.9 284.8


Sales growth 11.2 12.4 30.2 17.2 15.1

OPM 18.9 16.3 20.3 20.4 20.4

Oper. profit growth 20.0 (3.5) 62.5 18.1 14.8

COGS / Net sales 57.2 59.2 57.8 57.5 57.5

Overheads/Net sales 23.9 24.5 21.9 22.1 22.1

Depreciation / G. block 15.6 10.8 8.1 6.5 6.3

Effective interest rate 1.0 2.4 1.5 1.1 1.1

Net wkg.cap / Net sales 0.25 0.37 0.35 0.34 0.34

Net sales / Gr block (x) 5.7 5.1 5.5 5.2 5.1

RoCE 46.2 40.5 46.0 42.2 40.7

RoCE (Core) 38.8 36.4 50.7 48.2 48.2

Debt / equity (x) 0.19 0.19 0.13 0.10 0.07

Effective tax rate 21.4 22.8 25.3 25.2 25.2

RoE 35.5 30.2 33.0 30.2 28.9

Payout ratio (Div/NP) 17.0 35.4 40.6 40.5 42.3

EPS (Rs.) 68.1 59.8 88.0 98.0 112.5

EPS Growth 43.0 (12.3) 47.2 11.3 14.9

CEPS (Rs.) 78.5 68.9 96.2 106.0 121.7

DPS (Rs.) 11.6 21.2 35.7 39.7 47.6

Cash Flow (Rs Cr) Ratio Analysis (%)


L&T Infotech Ltd


Sector: IT services

28

Disclaimer

Disclosures:

The following Disclosures are being made in compliance with the SEBI Research Analyst Regulations 2014 (herein after referred to as the Regulations).

1. Axis Securities Ltd. (ASL) is a SEBI Registered Research Analyst having registration no. INH000000297. ASL, the Research Entity (RE) as defined in the Regulations, is engaged in the business ofproviding Stock broking services, Depository participant services & distribution of various financial products. ASL is a subsidiary company of Axis Bank Ltd. Axis Bank Ltd. is a listed publiccompany and one of India’s largest private sector bank and has its various subsidiaries engaged in businesses of Asset management, NBFC, Merchant Banking, Trusteeship, Venture Capital,Stock Broking, the details in respect of which are available on www.axisbank.com.

2. ASL is registered with the Securities & Exchange Board of India (SEBI) for its stock broking & Depository participant business activities and with the Association of Mutual Funds of India (AMFI) fordistribution of financial products and also registered with IRDA as a corporate agent for insurance business activity.

3. ASL has no material adverse disciplinary history as on the date of publication of this report.

4. I/We, Kumar Nihal – Manager, Research, MBA (Finance), author/s and the name/s subscribed to this report, hereby certify that all of the views expressed in this research report accurately reflectmy/our views about the subject issuer(s) or securities. I/We (Research Analyst) also certify that no part of my/our compensation was, is, or will be directly or indirectly related to the specificrecommendation(s) or view(s) in this report. I/we or my/our relative or ASL does not have any financial interest in the subject company. Also I/we or my/our relative or ASL or its Associates mayhave beneficial ownership of 1% or more in the subject company at the end of the month immediately preceding the date of publication of the Research Report. Since associates of ASL areengaged in various financial service businesses, they might have financial interests or beneficial ownership in various companies including the subject company/companies mentioned in thisreport. I/we or my/our relative or ASL or its associate does not have any material conflict of interest. I/we have not served as director / officer, etc. in the subject company in the last 12-monthperiod.

Any holding in stock – No

5. ASL has not received any compensation from the subject company in the past twelve months. ASL has not been engaged in market making activity for the subject company.

6. In the last 12-month period ending on the last day of the month immediately preceding the date of publication of this research report, ASL or any of its associates may have:

i. Received compensation for investment banking, merchant banking or stock broking services or for any other services from the subject company of this research report and / or;ii. Managed or co-managed public offering of the securities from the subject company of this research report and / or;iii. Received compensation for products or services other than investment banking, merchant banking or stock broking services from the subject company of this research report;

ASL or any of its associates have not received compensation or other benefits from the subject company of this research report or any other third-party in connection with this report.

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This report has been prepared by ASL and is meant for sole use by the recipient and not for circulation. The report and information contained herein is strictly confidential and may not be altered inany way, transmitted to, copied or distributed, in part or in whole, to any other person or to the media or reproduced in any form, without prior written consent of ASL. The report is based on thefacts, figures and information that are considered true, correct, reliable and accurate. The intent of this report is not recommendatory in nature. The information is obtained from publicly availablemedia or other sources believed to be reliable. Such information has not been independently verified and no guaranty, representation of warranty, express or implied, is made as to its accuracy,completeness or correctness. All such information and opinions are subject to change without notice. The report is prepared solely for informational purpose and does not constitute an offer documentor solicitation of offer to buy or sell or subscribe for securities or other financial instruments for the clients. Though disseminated to all the customers simultaneously, not all customers may receive thisreport at the same time. ASL will not treat recipients as customers by virtue of their receiving this report.

L&T Infotech Ltd


Sector: IT services

29

DisclaimerL&T Infotech Ltd


Sector: IT services

Disclaimer:

Nothing in this report constitutes investment, legal, accounting and tax advice or a representation that any investment or strategy is suitable or appropriate to the recipient’s specific circumstances. Thesecurities and strategies discussed and opinions expressed, if any, in this report may not be suitable for all investors, who must make their own investment decisions, based on their own investmentobjectives, financial positions and needs of specific recipient.This report may not be taken in substitution for the exercise of independent judgment by any recipient. Each recipient of this report should make such investigations as it deems necessary to arrive atan independent evaluation of an investment in the securities of companies referred to in this report (including the merits and risks involved), and should consult its own advisors to determine the meritsand risks of such an investment. Certain transactions, including those involving futures, options and other derivatives as well as non-investment grade securities involve substantial risk and are notsuitable for all investors. ASL, its directors, analysts or employees do not take any responsibility, financial or otherwise, of the losses or the damages sustained due to the investments made or anyaction taken on basis of this report, including but not restricted to, fluctuation in the prices of shares and bonds, changes in the currency rates, diminution in the NAVs, reduction in the dividend orincome, etc. Past performance is not necessarily a guide to future performance. Investors are advice necessarily a guide to future performance. Investors are advised to see Risk Disclosure Document tounderstand the risks associated before investing in the securities markets. Actual results may differ materially from those set forth in projections. Forward-looking statements are not predictions and maybe subject to change without notice.ASL and its affiliated companies, their directors and employees may; (a) from time to time, have long or short position(s) in, and buy or sell the securities of the company(ies) mentioned herein or (b)be engaged in any other transaction involving such securities or earn brokerage or other compensation or act as a market maker in the financial instruments of the company(ies) discussed herein oract as an advisor or investment banker, lender/borrower to such company(ies) or may have any other potential conflict of interests with respect to any recommendation and other related informationand opinions. Each of these entities functions as a separate, distinct and independent of each other. The recipient should take this into account before interpreting this document.ASL and / or its affiliates do and seek to do business including investment banking with companies covered in its research reports. As a result, the recipients of this report should be aware that ASLmay have a potential conflict of interest that may affect the objectivity of this report. Compensation of Research Analysts is not based on any specific merchant banking, investment banking orbrokerage service transactions. ASL may have issued other reports that are inconsistent with and reach different conclusion from the information presented in this report.Neither this report nor any copy of it may be taken or transmitted into the United State (to U.S. Persons), Canada, or Japan or distributed, directly or indirectly, in the United States or Canada ordistributed or redistributed in Japan or to any resident thereof. If this report is inadvertently sent or has reached any individual in such country, especially, USA, the same may be ignored and broughtto the attention of the sender. This report is not directed or intended for distribution to, or use by, any person or entity who is a citizen or resident of or located in any locality, state, country or otherjurisdiction, where such distribution, publication, availability or use would be contrary to law, regulation or which would subject ASL to any registration or licensing requirement within suchjurisdiction. The securities described herein may or may not be eligible for sale in all jurisdictions or to certain category of investors.The Disclosures of Interest Statement incorporated in this document is provided solely to enhance the transparency and should not be treated as endorsement of the views expressed in the report. TheCompany reserves the right to make modifications and alternations to this document as may be required from time to time without any prior notice. The views expressed are those of the analyst(s) andthe Company may or may not subscribe to all the views expressed therein.Copyright in this document vests with Axis Securities Limited.

Axis Securities Limited, Corporate office: Unit No. 2, Phoenix Market City, 15, LBS Road, Near Kamani Junction, Kurla (west), Mumbai-400070, Tel No. – 022 – 4050 8080 / 022 – 6148 0808, Regd. off.- Axis House, 8th Floor, Wadia International Centre, Pandurang Budhkar Marg, Worli, Mumbai – 400 025.

Compliance Officer: Anand Shaha, Email: [email protected], Tel No: 022-42671582.

DEFINITION OF RATINGS

Ratings Expected absolute returns over 12-18 months

BUY More than 10%

HOLD Between 10% and -10%

SELL Less than -10%

NOT RATED We have forward looking estimates for the stock but we refrain from assigning valuation and recommendation

UNDER REVIEW We will revisit our recommendation, valuation and estimates on the stock following recent events

NO STANCE We do not have any forward looking estimates, valuation or recommendation for the stock

l&t infotech ltd

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