IDBI Capital Markets & Securities Ltd. upgraded L&T Technology Services Limited after the Indian engineering services provider widened its quarterly operating margin, putting those gains in focus ahead of planned wage increases.
NDTV Profit and CNBC-TV18 reported that the brokerage changed its rating to Buy from Hold and set a ₹4,170 price target. L&T Technology Services reported an earnings before interest and taxes margin of 16.3% for its fiscal second quarter, up 60 basis points from the previous quarter and 220 basis points from a year earlier.
Revenue reached ₹30,404 million for the quarter ended Sept. 30, 2026, a 12.1% increase from a restated year-earlier figure reflecting continuing operations. The margin result met the company’s mid-16% goal earlier than it had planned.
L&T Technology Services said gross margins improved across its Mobility, Sustainability and Tech segments. Sustainability dollar revenue grew 13.4% from a year earlier and accounted for 38.0% of total dollar revenue. Tech dollar revenue fell 8.5%.
The company said contracts won in earlier quarters had begun moving into execution. Its large-deal wins during the September quarter exceeded $200 million in total contract value, with AI-related work accounting for more than half of that value.
Net income attributable to shareholders was ₹5,482 million, including a one-time ₹1,650 million gain from the disposal of the Smart World and Communication business. Profit from continuing operations was ₹3,801 million, compared with ₹3,177 million a year earlier.
NDTV Profit reported that IDBI Capital flagged planned third-quarter wage increases, weak European auto demand and softer Tech activity as risks. The reported pressures put the durability of the margin improvement at issue even as the brokerage raised its rating.
The company declared an interim dividend of ₹20 per share. Its record date for determining eligible shareholders is Oct. 27.
