Neutral on L&T Infotech, target price Rs 3680: Motilal Oswal

Motilal Oswal has neutral call on Larsen & Toubro Infotech with a target price of Rs 3680. The current market price of Larsen & Toubro Infotech Ltd. is Rs 3816.1.

Larsen & Toubro Infotech Ltd., incorporated in the year 1996, is a Large Cap company (having a market cap of Rs 68417.48 Crore) operating in IT Software sector.

Financials
For the quarter ended 31-03-2021, the company reported a Consolidated Total Income of Rs 3372.40 Crore, up 4.68 % from last quarter Total Income of Rs 3221.70 Crore and up 9.42 % from last year same quarter Total Income of Rs 3082.10 Crore. Company reported net profit after tax of Rs 545.70 Crore in latest quarter.

Investment Rationale
Despite being confident of the company’s execution capabilities, the brokerage remains on the sidelines, led by significant multiple expansions. It values the stock at 26x FY23E EPS (in line with TCS valuation, given LTI’s industry-leading growth). Its TP of INR3,680 per share implies a 6% downside.

Promoter/FII Holdings
Promoters held 74.3 per cent stake in the company as of Dec 30, 2020, while FIIs held 13.3 per cent, DIIs 4.6 per cent and public and others 7.8 per cent.