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🇮🇳 Quality Investing

Jan 20 • 8 tweets • 3 min read

#LTTS🌏 is a long-term compounder as engineering services growth is less volatile now wth d digital transformation trend supporting growth across industries

LTTS’s scale is superior to most of its global peers in engineering services, wch allows it to invest in many new areas

#LTTS🌏 is able to cross-pollinate its capabilities across industry verticals n this creates more cross-selling opportunities n higher differentiation compared wth peers

LTTS also present in broader set of verticals as comprd to Indian engg. services peers Cyient,KPIT & Elxsi

At the current price, #LTTS🌏 trading at 25 times its FY24 earnings

#LTTS🌏has been selected as strategic engineering partner to Airbus 4 providing Advanced Engineering Capabilities n Digital Manufacturing Services under a multi-year contract

LTTS will support Airbus in key verticals n tech areas for its ongoing Commercial n Innovation programs

#LTTS🌏 engineers will support Airbus' Numerical Control Programming (NCP) Cluster which includes composite production, trimming & cutting, standard machining, advanced machining, drilling & riveting, control & metrology, fast shop machining and technical support.

#LTTS🌏 will also be driving the design and stress support for Advanced Capabilities which includes thermal analysis, vulnerability assessment, advanced failure analysis, manufacturing simulation, and modeling services.

In Q3, #LTTS🌏 won five $10-million-plus total contract value deals along with a significant empanelment with Airbus.

LTTS recorded an Ebit margin of 18.7% in Q3, which helped it cross the Rs 300-crore milestone in quarterly profits.

#LTTS🌏 crossed 1,000 patent filings, reflecting the engineering and technology talent driving growth for the company.

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🇮🇳 Quality Investing

@ParveenBhansali

Jan 21

#LTIMindtree

MD&CEO Mr Chattejee:

Integration of d 2 Cos led to margin hit plus Q3 is seasonally weak

Overall cost of delivery has been a little high in Q3 which is a one-time cost.

A significant part of integration cost has been absorbed into Q3 n will show in Q4 as well

#LTIMindtree has started out with a $1 billion quarterly revenue run rate.

The client imperative to dial up technology-led innovation for future-readiness holds a long-term upside for Cos full-stack offerings

#LTIMindtree hierarchy suggesting to gain up to 200 bps in margin over next 4-5 yrs after consolidating 180 bps hit due to integration of the 2 Co's.

Co appears to be holding on to strong footing with a sharp drop in attrition levels & a billion $-plus deal booking during Q3

Read 6 tweets

🇮🇳 Quality Investing

@ParveenBhansali

Jan 18

#LTTS🌏 is eying 'big boys' club in terms of revenue from engineering services and related segments in coming years with its biggest acquisition #SWC since its inception.

#LTTS🌏 set for a leapfrog jump in network engineering segment.

MD & CEO, #LTTS🌏 said the acquisition is both margin and EPS accretive n will help the engineering services firm achieve $1.5 billion revenue by FY25.

He said: IT firms such as TCS, Infosys, Tech Mahindra n Wipro do $300 to $500 million of business annually in network engineering segment. With this acquisition, #LTTS🌏will hv opportunity to enter into big boys' club as SWC comes up wth deep expertise n assets in d said segment

Read 6 tweets

🇮🇳 Quality Investing

@ParveenBhansali

Jan 16

#LTTS🌏 aspires to hit $2 billion in annual revenues by FY26, post its acquisition of Smart World and Communication.

#LTTS🌏 will also focus on developing full-stack technology offerings in next gen communications, smart spaces and cybersecurity, even as it expects to double the revenue of the combined Smart World and Communication (SWC) business to $400 million in the next three years.

#LTTS🌏 CEO & MD Amit Chadha:

“From the revenue standpoint, we are at a run rate of $1 billion and SWC’s business will be about $140 million. This puts us in line to achieve $1.5 billion by FY25, and $2 billion shortly thereafter,”

Read 7 tweets

🇮🇳 Quality Investing

@ParveenBhansali

Jan 13

#LTTS🌏 on recent SWC acquisition:

Strong Demand 4 Electrification, Energy transition,5G rollout n cyber security across their clients in US n Europe,parts of Asia

There is demand 4 service net models 4 efficient campuses,cities,utilities mobility,public safety n cyber security

Rationale LTTS management saying has been taken to go ahead and acquire SWC business:

1.6 trillion dollars of engineering spent in FY21 was laid by manuf. 51% for manufacturing cos is expected by FY25 to 2.3 trillion dollars with 58% coming from HiTech & services

In the medium term which is 2 to 3 yrs this acquisition will be both Margin n EPS accretive but in the immediate term which is one year there could be little bit of dilution.

In the medium term #LTTS🌏 management reaffirming their guidance of being margin accretive.

Read 8 tweets

🇮🇳 Quality Investing

@ParveenBhansali

Jan 12

#LTTS🌍 to acquire L&T’s Smart World & Communication Business

SWC has a strong expertise in communication wth network design, planning, implementtn n mgmt of Netwrk Operations Cntr, Opertnl Supp System, Datacenters, Cloud/pvt 5G network at more than 25K locations across India

SWC has an employee base of over 700 engineers from diversified technology domains and has crossed an annual revenue of INR 1,000 Crores.

This acquisition will pave way for SWC’s offerings to reach the global market leveraging LTTS🌍 global footprint.

SWC cater to d demands in smart cities, smart utilities, n digital infrastructure.

Over d yrs, it has touched 150+ million urban lives, running 25+ smart city operation centers, connecting 2 million assets and
business applications encompassing the areas
Contd....

Read 4 tweets

🇮🇳 Quality Investing

@ParveenBhansali

Jan 11

#LTIM
LTI Mindtree merger creates a strong challenger in the Indian IT space with a $4.1 billion revenue run-rate as the combined entity has significant revenue synergies owing to the complementary nature of clients and service offerings.

LTI can benefit from Mindtree's strength in d experience layer of digital n addressing CMO budgets while d latter can benefit from d former’s strength in packaged applications

Overlap among key clients is minimal ensuring no turf wars.

The LTI Mindtree merger would definitely be a new cylinder in the engine room here.

This could lead to the country’s next large-scale IT Services player.

Read 10 tweets

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