- LTTS Q4 FY25 Results: A Strong Finish to the Year with Record Deals and Clear Growth Plans
- Revenue Growth: LTTS Crosses ₹10,000 Crore
- Big Wins: Record Deals in Q4
- Focus on Innovation: Patents and AI Projects
- Business Growth Through Acquisition
- Segment-Wise Performance
- Financial Performance: Q4 and FY25
- Operations and Efficiency Metrics
- Profit Margins: Present Challenges and Future Outlook
- Management’s Plans for FY26
- Industry and Market Trends
- Questions Answered by LTTS Management
- Final Thoughts
LTTS Q4 FY25 Results: A Strong Finish to the Year with Record Deals and Clear Growth Plans
L&T Technology Services Limited (LTTS) ended FY25 on a strong note. The company crossed ₹10,000 crore in annual revenue for the first time. It also saw healthy growth in deal wins, especially in the last quarter of the year. Despite facing some short-term margin pressure, LTTS remains confident about growth in FY26.
Let’s go over the highlights from the Q4 and full-year results in simple terms.
Revenue Growth: LTTS Crosses ₹10,000 Crore
In FY25, LTTS reported total revenue of ₹10,670 crore, which is up 10.6% from the previous year. In US dollar terms, revenue for the fourth quarter grew by 10.7% year-on-year. If we look at constant currency (which removes the effect of exchange rate changes), revenue was up by 8.9% for the year.
This growth was better than the average Indian IT industry growth of around 6%, as mentioned by LTTS management.
The company’s revenue is now running at an annual rate of $1.4 billion, which puts LTTS in a stronger position in the global engineering and R&D services space.
Big Wins: Record Deals in Q4
LTTS had its best-ever quarter for large deal wins in Q4FY25. Some major deals include:
- One deal worth more than $80 million (biggest in Industrial Products)
- One $50 million+ deal (in Software Defined Vehicles with a European OEM)
- Several other deals in the $10–30 million range
In total, the company signed 32 deals in FY25, each worth over $10 million. This includes:
- One deal over $80 million
- Three deals over $50 million
- Five deals between $30–50 million
- Ten deals between $15–25 million
There are also several big deals (over $50 million and even $100 million) that are in the final stages of negotiation.
These wins show that LTTS is getting more trust from global companies and winning bigger and more strategic projects.
Focus on Innovation: Patents and AI Projects
LTTS is not just about numbers. The company is also working on new technologies and solutions.
- It has filed over 1,500 patents so far.
- 573 of these are LTTS-owned.
- 929 are for clients.
- 190 are in the areas of AI and GenAI.
- In FY25 alone, it filed 206 patents—about 50 every quarter.
LTTS also has a key partnership with NVIDIA to build AI-based solutions for sectors like Rail, Medtech, and Smart Infrastructure. One such project, TrackEI, an AI system for rail inspection, won the Etihad Rail Innovation Award.
Business Growth Through Acquisition
LTTS completed the acquisition of Intelliswift, a move aimed at growing its presence in sectors like Retail, Fintech, and Healthcare. Intelliswift has already been integrated into LTTS operations.
The detailed impact of this acquisition will be shared by LTTS in upcoming updates. But early signs show that it’s helping the company expand faster into newer areas.
Segment-Wise Performance
LTTS operates in three key business segments: Mobility, Sustainability, and Tech (Software & Platforms). Here’s a quick look at how each segment performed:
Mobility
- Revenue was stable compared to the previous quarter.
- The segment faced pressure due to issues in the auto and transport sector.
- However, LTTS won a major €50 million deal for a software-defined vehicle project with a European client.
- Technologies like iDrive and AI-based personalization remain key focus areas.
- Short-term outlook is muted, but recovery is expected by the end of Q2FY26.
Sustainability
- This segment grew 2% quarter-on-quarter.
- Growth was slightly affected by delays in project ramp-ups, which should normalize in early FY26.
- Key drivers include plant engineering, digital twins, and AI-based monitoring systems.
- Important wins:
- Became the preferred engineering partner for a European oilfield company.
- Signed more work with a major oil & gas client.
- Launched RefineryNext, an AI solution for predictive maintenance and carbon tracking.
- The Industrial Products sub-segment had a major win with an $80 million+ deal.
- Outlook: Good pipeline in Energy, Robotics, Data Centers, and Semiconductors.
Tech (Software & Platforms)
- This was the fastest-growing segment, with 28% QoQ growth.
- Growth came from Smart Infrastructure, platform solutions, and the Intelliswift acquisition.
- Strong client activity in Fintech, Retail, Medtech, and with cloud providers.
- FY26 outlook is positive, with more deals expected in these areas.
Financial Performance: Q4 and FY25
Q4 FY25 Highlights
- Revenue: ₹2,982 crore (up 12.4% QoQ, 17.5% YoY)
- EBIT margin: 13.2% (lower due to Intelliswift impact of -150 basis points)
- Net profit: ₹311 crore
- Free cash flow: ₹1,379 crore (109% of net profit)
- Cash reserves: ₹2,976 crore (even after paying for the acquisition)
Full-Year FY25 Highlights
- Revenue: ₹10,670 crore (+10.6% YoY)
- EBIT margin: 14.9% (lower due to earlier investments and the Intelliswift impact)
- Return on equity (ROE): 22%
- Tax rate: 27.4%
Operations and Efficiency Metrics
LTTS is also focusing on improving how it runs its business. Here are some key numbers:
- Offshore work (done in India): 55.8% of total (lower due to Intelliswift; aim is to reach ~60%)
- Fixed-price projects: 39.9% of revenue
- Client growth: 43 new clients added (thanks to Intelliswift)
- More clients in the $1 million+ and $20 million+ range
- Total employees: 24,258 (net addition of 793 in Q4)
- Attrition: 14.3% (stable)
- Exchange rate used: ₹86.41 per USD (Rupee fell 1.6% QoQ)
Profit Margins: Present Challenges and Future Outlook
LTTS is targeting to bring EBIT margins to around 16% by late FY27 or early FY28.
Right now, margins are slightly lower due to:
- The impact of Intelliswift (added costs)
- Some macroeconomic pressures
- Q4 investments in future-focused projects (some work was discounted or unbilled to win long-term deals)
Management believes these pressures are short-term. As revenue from new deals starts to come in and the acquisition costs normalize, margins should improve.
Management’s Plans for FY26
LTTS expects double-digit growth in constant currency for FY26. This includes the contribution from Intelliswift.
Key points from management:
- Mobility will stay weak for the next quarter or two, but a comeback is expected by Q2FY26-end.
- Sustainability and Tech segments will drive most of the growth this year.
- The company is aiming for $2 billion in revenue over the next few years.
- Strategy: Focus on scaling each segment deeply instead of spreading too thin.
Industry and Market Trends
LTTS also shared some thoughts about what’s happening in the industry:
- Macro challenges are causing delays in new project signings.
- However, clients are showing high interest in AI and digital solutions that help boost productivity.
- Europe is growing well (21% YoY) due to company consolidations.
- The US market is seeing demand for digital transformation.
- The “China+1” strategy is helping Indian companies like LTTS win more work in manufacturing.
- Pricing remains stable, with more focus on using AI to improve efficiency.
- Salary hikes for CY25 haven’t been finalized yet (last done in Nov 2024).
Questions Answered by LTTS Management
Here are a few answers shared by the company during the investor Q&A:
- Intelliswift impact: Expected to add ~$100 million annual revenue but also causes a ~150 bps margin drop. Cost benefits and synergies are being worked on.
- Strategic investments in Q4: Some work was done at lower prices to win long-term clients. These are not expected to repeat.
- Deal ramp-ups: Most deals from Q3 are now running fully. Newer Q4 deals will start contributing from Q1FY26.
- Europe vs US: Europe is seeing more consolidation-based deals, while the US is focused on digital projects.
- Margin recovery: Management expects margins to improve through better efficiency, higher revenue, and benefits from the acquisition.
Final Thoughts
L&T Technology Services Limited (LTTS) had a strong finish to FY25. It crossed key milestones in revenue, won record deals, and expanded into new markets with the Intelliswift acquisition.
While there were some short-term challenges like lower margins, the company is confident about growth in FY26. With a strong order pipeline, steady innovation in AI and digital areas, and clear plans to grow its major business segments, LTTS is well-placed for future success.
FAQs
Q: What was LTTS’s revenue for FY25?
A: ₹10,670 crore, which is 10.6% higher than last year.
Q: What is Intelliswift and why did LTTS acquire it?
A: Intelliswift is a tech services firm focused on Retail, Fintech, and Healthcare. LTTS bought it to expand in these areas.
Q: Will profit margins improve in FY26?
A: Yes, LTTS expects margins to improve as new deals bring in revenue and costs from Intelliswift settle down.
Q: What segments will drive LTTS growth in FY26?
A: Mainly Sustainability and Tech (Software & Platforms).
Q: Is LTTS planning more acquisitions?
A: Nothing is announced yet, but LTTS may look at more growth opportunities in future.
Read More at sharepricenews.com
I’m Rahul Chaudhary, and I write about everything related to the Share Market. From Stock Trends and Share Prices to the Latest News and IPO Updates, my articles aim to provide you with valuable insights to help you navigate the world of investing. Stay tuned for expert tips and updates to keep you informed!
