L&T Tech Services Q1FY23 net up 27% YoY to Rs 274 cr amid surge in deals

Margins were better managed despite a higher attrition of 23.2% in Q1, up from 20.4% in Q4FY22

L&T Technology Services reported net profit of Rs 274 crore for the first quarter ended June 30, 2022 up 27 per cent year-on-year. Sequentially the profit was up 4.7 per cent.

Revenue for the company, which focuses on engineering services, grew at 23 per cent YoY at Rs 1,873 crore, abd 6.7 per cent sequentially.

The company also reaffirmed the FY23 revenue growth guidance of 13.5-15.5 per cent. The firm's dollar revenue grew 3.2 per cent at $239.5 million, and came in at 4.7 per cent in constant currency.

During the quarter, LTTS won a $50 million plus deal, four $15 million deals and two deals with TCV of $10 million.

“We started the new fiscal on a strong note with revenue growing sequentially by 4.7 per cent in constant currency terms. Growth was led by plant engineering and industrial products, benefitting from spends towards digital manufacturing, energy transition and smart & connected products. Our focus on big bets has helped us align ourselves with these strategic and multi-year customer programs,” said Amit Chadha, CEO & MD, L&T Technology Services.

He further elaborated that deal wins were spread across segments. Its Aerospace and Rail segment is seeing a revival of large deal bookings with a $50 million deal in Q1. “We recently opened an engineering design centre in Toulouse, France to cater to new age digital requirements of Aerospace. We see a broad-based pipeline of opportunities which gives us confidence of the growth momentum sustaining,” added Chadha.

EBIDTA margins came in at 21.4 per cent for the quarter. However, margins were better managed despite a higher attrition. The company reported attrition of 23.2 per cent for the Q1 FY23, up from 20.4 per cent in Q4 FY22. The total headcount now stands at 21,433

At the end of Q1FY23, the patents portfolio of L&T Technology Services stood at 913, out of which 625 are co-authored with its customers and the rest are filed by LTTS.