Stories
Nomura Downgrades LTM to Neutral on Valuation, Retains Target Price
M
Moneycontrol•19-10-2026, 15:47
Nomura Downgrades LTM to Neutral on Valuation, Retains Target Price
- •Nomura downgraded LTM from Buy to Neutral due to valuation while keeping the target price steady at Rs 4,410.
- •LTM reported second-quarter revenue up 1.1% quarter-on-quarter in constant currency, driven by Financial Services and Production.
- •EBIT margin reached 15.6%, slightly below Nomura's estimate, while total contract value stood at $1.26 billion.
- •Artificial intelligence now accounts for 13.4% of total revenue, reflecting a 40% year-on-year growth.
- •Management expects stronger growth in the second half of FY27 and margin improvements through cost-optimisation programs.
Key Questions Answered
Nomura downgraded LTM from 'Buy' to 'Neutral' based on valuation considerations, while keeping its target price unchanged at Rs 4,410 following the IT services company's second-quarter results for FY27.
Artificial intelligence currently accounts for approximately 13.4% of LTM's total revenue, representing a 40% increase year-on-year.
LTM anticipates that revenue growth in the second half of FY27 will surpass the first half, with both the third and fourth quarters posting stronger growth rates. The company also expects ongoing cost-optimisation efforts to help improve margins and offset near-term integration headwinds.
