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Larsen & Toubro Infotech Limited Q4 FY22 Earnings ConCall Summary

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LTI said FY22 saw the company cross the $2 billion revenue milestone, by delivering its highest ever revenue growth this year. As for headcount, during Q4, LTI added 2,448 on a net basis and for FY22 it stood at 10,657. In 4Q22, attrition was 24% vs. 22.5% in 3Q on an LTM basis.

Q&A Insights: Vimal Gohil of @UnionBankTweets asked about weakness in cash flow generation in FY22 and outlook. Anil CFO said LTI had a strong cash flow conversion in 4Q22 at 97% vs. 70% in 3Q, mainly due to better working capital construct. LTI expects to continue in same range.

Q&A Insights: Vimal Gohil of @UnionBankTweets also enquired about LTI’s capex number being elevated for FY22. Anil Rander CFO replied that it’s due to LTI investing in its own building that’s coming up in Mahape, which can seat 7,500 people, that is likely to go live in FY23.

Q&A Insights: Vimal Gohil of @UnionBankTweets enquired about the overall demand environment. Sanjay Jalona CEO said that looking at the demand, the pipeline, LTI is not seeing any signs of anything getting delayed. So it continues to be strong and LTI feels good about the demand.

Q&A Insights: Sandip Agarwal with @EdelweissFin asked about attrition and how LTI is handling it. Sanjay Jalona CEO said that LTI hired 1,500 HTD (hire, train and deploy) people because one can’t find perfect people and keep poaching from one another.

Q&A Insights: Abhishek of @Nomura asked about SG&A cost consistently declining and its sustainable level. Sanjay CEO said LTI has said it wants to grow faster, to invest back in business. LTI is going to hire 100 sales people by 1Q23 end in US, raising sales cost significantly.

Q&A Insights: Sandeep of @EquirusGroup asked about onsite attrition impacting 2-4% volume growth and when it would be addressed. Sanjay CEO said that while it’s back to March levels, LTI needs to see the impact of recent salary hikes. By 2Q23, it expects to see the 2-4% growth.

Q&A Insights: Mohit Jain of @rathi_online asked about fresher hiring for FY23. Sanjay CEO said that fresher base for FY23 is set at, at least 6,500. Last year, the number was 4,500, but hired 5,200 people. And now LTI’s base is 6,500. So, LTI will definitely do more than that.

Q&A Insights: Sanjay Jalona CEO replying to a capex question by Mohit Jain of @rathi_online said that LTI is also investing in some other centers like Coimbatore and other locations because lot of people drifted to these locations during COVID.

To read further on the detailed analysis of #LTI concall Q&A …

alphastreet.com/india/larsen-t…