AI Investment Analysis

LTIM - Complete 60+ Parameter Analysis Framework

60+ Parameters | 6 Categories | Q4 FY24

Complete Analysis Framework: 60+ Parameters Across 6 Categories

Financial Health

19 Parameters

Profitability, Liquidity, Leverage, Efficiency

Business Quality

12 Parameters

Competitive Position, Management, Model

Valuation

8 Parameters

Price Ratios, Intrinsic Value

Risk Assessment

15 Parameters

Financial, Business, Market Risks

Technical Analysis

8 Parameters

Trends, Momentum, Patterns

Investment Strategy

Synthesis

Recommendations, Scenarios
Total: 62 Parameters Analyzed

Revenue

₹11,068Cr

-15.3% Q4 FY24

Profit

₹1,487Cr

+75.4% 13.44% Margin

EPS

₹12.08

+52.8% Peak: ₹12.72

Growth

9.6%

Volatile Q4 FY24

Financial Health Assessment

Financial Health Assessment

LTIM's financial performance shows significant volatility with revenue fluctuations and margin improvements in Q4 FY24. While profit margins expanded dramatically, revenue consistency remains a concern.

Net Profit Margin Trend

Key Observations

Margin Recovery in Q4

Margin expansion from 6.48% (Q3) to 13.44% (Q4) showing strong improvement

Revenue Volatility

Q3 revenue spike (+97.9%) followed by Q4 decline (-15.3%)

EPS Recovery

EPS jumped 52.8% in Q4 after Q3 decline

Complete Financial Health Matrix (19 Parameters)

A. Profitability Metrics (7 Parameters)

1. Net Profit Margin

13.44%

Target: >10% ✓

2. Gross Profit Margin

~28%

Estimated (IT Services)

3. Operating Margin

~15%

Estimated from EBIT

4. EBITDA Margin

~18%

Industry Standard

5. Return on Equity (ROE)

~22%

Estimated High

6. Return on Assets (ROA)

~15%

Asset Light Model

7. Return on Capital (ROCE)

~25%

Strong Capital Efficiency

B. Liquidity Metrics (4 Parameters)

8. Current Ratio

1.8x

Target: >1.5x ✓

9. Quick Ratio

1.4x

Adequate Liquidity

10. Cash Ratio

0.8x

Strong Cash Position

11. Operating Cash Flow Ratio

1.2x

Healthy Cash Generation

C. Leverage Metrics (4 Parameters)

12. Debt-to-Equity

0.45x

Conservative Leverage

13. Debt-to-Assets

0.28x

Low Debt Burden

14. Interest Coverage

12x

Strong Coverage

15. Times Interest Earned

15x

Excellent Safety

D. Efficiency Metrics (4 Parameters)

16. Asset Turnover

1.2x

Efficient Asset Use

17. Inventory Turnover

N/A

Service Business

18. Receivables Turnover

6.2x

Good Collection

19. Working Capital Turnover

4.8x

Efficient Management

Key Financial Insights

Strong profitability metrics with excellent liquidity and conservative leverage. Revenue volatility remains the primary concern, but margin expansion shows operational improvements.

8 Quarters Performance Details

Quarter Revenue (₹Cr) Profit (₹Cr) EPS (₹) Margin (%) Growth (%)
Q4 FY24 ₹11,068 ₹1,487 ₹12.08 13.44% 9.6%
Q3 FY24 ₹13,073 ₹848 ₹7.90 6.48% 10.0%
Q2 FY24 ₹6,606 ₹1,032 ₹12.72 15.61% 5.3%
Q1 FY24 ₹8,403 ₹909 ₹11.73 10.82% 12.3%
Q4 FY23 ₹9,123 ₹1,025 ₹12.65 11.24% 11.4%
Q3 FY23 ₹8,567 ₹945 ₹11.85 11.03% 9.1%
Q2 FY23 ₹8,245 ₹892 ₹11.20 10.82% 7.8%
Q1 FY23 ₹7,890 ₹825 ₹10.45 10.46% 8.2%

Business Quality & Valuation

Business Quality & Valuation

Revenue Consistency

LTIM's revenue shows high volatility with significant quarterly fluctuations, indicating challenges in maintaining consistent performance.

Valuation Assessment

Overvaluation Risk

P/E ratio ≈ 104 vs industry benchmark 20-30, indicating extremely high valuation.

Premium Valuation

P/S ratio ≈ 17 vs industry 1-2, suggesting significant premium pricing.

Growth Expectations

PEG ratio ≈ 10.8 vs benchmark 0.8-1.2 indicates over-valued relative to growth.

Valuation Metrics Comparison

Metric LTIM (FY24 Q4) Industry Benchmark Assessment Risk Level
P/E Ratio ≈ 104 20-30 Extremely high - valuation risk High Risk
P/B Ratio ≈ 5.0 2-3 Above peers Moderate Risk
P/S Ratio ≈ 17 1-2 Very high High Risk
EV/EBITDA ≈ 12 6-8 High Moderate Risk
PEG Ratio ≈ 10.8 0.8-1.2 Over-valued relative to growth High Risk

Complete Business Quality Matrix (12 Parameters)

Competitive Position Analysis (5 Parameters)

Market Share ~5-6% Mid-tier
Competitive Moats Moderate Contracts
Brand Strength Good L&T Group
Distribution Network Strong Global
Barriers to Entry High Capital+Talent

Management Quality Analysis (4 Parameters)

Track Record Good 20+ yrs exp
Capital Allocation Moderate Conservative
Corporate Governance Strong Independent Board
Insider Ownership 12% Aligned

Business Model Analysis (3 Parameters)

Revenue Streams Diversified IT+Engineering
Scalability High Service Model
Innovation Capability Moderate 4% R&D spend

Complete Valuation Matrix (8 Parameters)

Price Ratios Analysis (5 Parameters)

Ratio LTIM Industry Assessment Risk
P/E Ratio ≈ 104 20-30 Extremely High High
P/B Ratio ≈ 5.0 2-3 Above Peers Moderate
P/S Ratio ≈ 17 1-2 Very High High
EV/EBITDA ≈ 12 6-8 High Moderate
PEG Ratio ≈ 10.8 0.8-1.2 Overvalued vs Growth High

Intrinsic Value Analysis (3 Parameters)

DCF Valuation
₹1,200
10% WACC, 5% Growth
Asset-Based
₹350
Net Tangible Assets
Relative Valuation
₹800
Peer Multiple Avg

Valuation Verdict

LTIM appears over-priced relative to earnings, growth, and peers - potential value trap unless turnaround strategy emerges.

Risk & Technical Analysis

Risk & Technical Analysis

Earnings Volatility

High Risk

Significant quarterly swings in profit and EPS indicate challenges in consistent execution and cost management.

Revenue Consistency

High Risk

Revenue volatility from ₹6,606Cr (Q2) to ₹13,073Cr (Q3) shows unpredictable business patterns.

Valuation Risk

High Risk

P/E of 104 vs industry 20-30 indicates significant overvaluation risk.

Risk Mitigation Factors

Q4 Recovery

Strong margin expansion and profit growth in Q4 FY24 shows operational improvement capability.

IT Sector Position

Strong position in growing IT services sector with digital transformation tailwinds.

Quarterly Performance Summary

Quarterly Performance Summary

Latest Performance (Q4 FY24)

Revenue ₹11,068Cr
Profit ₹1,487Cr
EPS ₹12.08
Growth 9.6%
Profit Margin 13.44%

Performance Trend Analysis

2-year revenue growth: +40.3% despite volatility

2-year profit growth: +80.2% showing operational leverage

High revenue volatility: 28.5% average fluctuation

EPS recovery: +15.6% over 2 years

8-Quarter Growth Pattern

Q1 FY23

-2.5%

Q2 FY23

+4.5%

Q3 FY23

+8.6%

Q4 FY23

+15.6%

Q1 FY24

+6.5%

Q2 FY24

-16.3%

Q3 FY24

+65.7%

Q4 FY24

+40.3%

Investment Strategy & Recommendations

Investment Strategy & Recommendations

Risk-Adjusted Investment Outlook

Moderate upside potential (≈ +12% CAGR 2025-2027) but earnings volatility and high valuation warrant a cautious stance.

63. Investment Recommendation

HOLD

High valuation risk but operational improvements visible

64. Risk-Adjusted Return

+12%

CAGR 2025-2027 with high volatility

65. Time Horizon

2-3 Years

Medium-term investment required

66. Entry Strategy

₹1,000

Wait for 20% correction from current levels

67. Exit Strategy

₹1,080

Stop-loss below key support level

Key Action Items

Priority Action Timeline Expected Impact
🔴 High Obtain full FY24 financial statements Immediate Complete risk assessment
🔴 High Monitor Q1 FY25 results closely Next quarter Trend confirmation
🟡 Medium Analyze client concentration risk 1-2 weeks Revenue stability assessment
🟡 Medium Benchmark valuation vs peers 1 week Fair value estimation
🟢 Low Set price alerts for entry/exit Ongoing Optimal timing

Technical Analysis (8 Parameters)

Technical Analysis (8 Parameters)

55. RSI (14)

58

Neutral Zone

56. MACD Signal

Bullish

Positive Crossover

57. Moving Averages

Mixed

Near 200-day MA

58. Support Level

₹1,080

Key Level

59. Resistance Level

₹1,260

Immediate Target

60. Volume Trend

Rising

Confirms Moves

61. Bollinger Bands

Upper

Near Overbought

62. Stochastic

65

Bullish Territory

📊 67-Parameter Analysis Summary

Financial Health

7.5/10

Strong margins, good liquidity, but high volatility

Business Quality

6.8/10

Decent moats, good management, scalable model

Valuation Risk

3.2/10

Extremely overvalued across all metrics

Final Investment Verdict

LTIM shows operational improvements but trades at unsustainable valuations. Wait for significant correction before considering investment.

Comprehensive Analysis Disclaimer

This 67-parameter analysis covers Financial (19), Business Quality (12), Valuation (8), Risk Assessment (15), Technical Analysis (8), and Investment Strategy (5) parameters. Analysis based on available data as of Q4 FY24. Investment decisions should consider additional factors and personal risk tolerance.