L&T Technology Q2 FY27 Results (NSE: LTTS)
Signal: Margin expansion
The read
The operating trajectory improved for a third consecutive quarter: consolidated EBIT margin expanded to 16.3%, +225bps YoY and +64bps QoQ, while revenue grew +12.1% YoY; however, the ₹5,487 million PAT was materially inflated by the ₹1,650 million net gain on the SWC disposal.
| Metric | Value | YoY | QoQ |
|---|---|---|---|
| Revenue | ₹3,040.4 Cr | +12.1% | +3.4% |
| EBIT | ₹496.5 Cr | +29.8% | |
| Net profit | ₹548.7 Cr | +66.7% | |
| EPS | ₹51.67 | +66.6% | |
| EBIT margin | 16.3% |
P&L walk
Revenue increased to ₹30,404 million, +12.1% YoY and +3.4% QoQ, while EBIT rose +29.8% YoY to ₹4,965 million as employee costs grew +10.5%; reported PAT growth of +66.7% was dominated by the ₹1,650 million discontinued-operations gain.
Segments
Sustainability is the principal growth engine, with revenue up 22.9% YoY to ₹11,566 million and segment result up 29.3% to ₹3,415 million; Tech revenue slipped 0.6% to ₹9,019 million, although its result rose 20.7% to ₹1,078 million.
Key positives
- Consolidated EBIT rose +29.8% YoY to ₹4,965 million versus revenue growth of +12.1%, a +17.7 percentage-point growth gap; employee costs grew +10.5%, D&A declined 2.9% and finance costs declined 11.5%, while EBIT margin expanded 225bps to 16.3%.
- Sustainability revenue grew +22.9% YoY to ₹11,566 million and segment result grew +29.3% to ₹3,415 million, making it the clearest current growth driver.
- Mobility revenue grew +13.5% YoY to ₹9,819 million and segment result grew +29.5% to ₹1,664 million.
- H1FY27 operating cash flow increased +16.2% YoY to ₹5,588 million, ahead of H1FY27 net profit from continuing operations of ₹7,324 million on an absolute basis.
Key concerns
- Tech revenue declined 0.6% YoY to ₹9,019 million, showing no reported quarterly growth inflection by Q2FY27 despite result growth of 20.7% to ₹1,078 million.
- Reported PAT growth of 66.7% to ₹5,487 million was not representative of recurring operations because discontinued operations contributed ₹1,686 million, including the SWC transfer gain.
- Consolidated employee benefits expense of ₹17,521 million remained 57.6% of revenue, limiting the durability of margin expansion if revenue growth slows.
Research and educational content only. Not investment advice.