Prabhudas Lilladher has maintained its Hold rating on lti mindtree with a target price of ₹6,000, citing the company's better-than-expected quarterly performance and strong deal momentum. The brokerage firm noted that while revenue growth exceeded estimates, selective pockets showed muted performance, particularly in key verticals.

Quarterly Performance Analysis

The company delivered revenue growth of 2.4% quarter-on-quarter in constant currency, surpassing Prabhudas Lilladher's estimates of 2.0%. This growth was primarily aided by the ramp-up of large deals and pass-throughs. However, the performance was mixed across verticals, with BFSI and CMT segments showing particularly muted growth.

Deal Pipeline and Growth Prospects

Despite the mixed vertical performance, deal signing activities remain robust in BFSI and CMT verticals. The management indicated that it will take a few more quarters to achieve normalized revenue run-rates for top marquee accounts. The pace of deceleration in top client accounts has reduced sequentially, suggesting potential recovery following productivity benefits.

The company's participation in vendor consolidation deals, combined with continued momentum in new client wins, provides better growth visibility. A notable highlight is the recent Indialed new client deal with CBDT, which is expected to contribute approximately 80-90 basis points to the topline in FY27.

Margin Outlook and Operational Efficiency

LTIMindtree successfully sustained margins at the previous quarter's high base despite having pass-throughs. This performance was supported by internal margin programs under the 'fit-for-future' initiative and favorable INR depreciation impacts in the third quarter.

Investment Recommendation

Prabhudas Lilladher has kept its margin estimates largely unchanged, acknowledging that wage hike impacts will continue to pressure margins. The brokerage projects constant currency revenue growth of 5.4%, 8.9%, and 9.5% year-on-year for FY26E, FY27E, and FY28E respectively, while maintaining margin estimates at 15.3%, 15.6%, and 15.9% for the corresponding periods.

The firm has assigned a 25x PE multiple to FY28E EPS, resulting in a target price of ₹6,000, which represents full valuations. Consequently, Prabhudas Lilladher retains its Hold recommendation on the stock, with EPS estimates seeing an upgrade of approximately 2% each for FY27E and FY28E.

LTI Mindtree has received a maintained BUY rating from Anand Rathi with a revised target price of ₹7,375, representing an upside of approximately 16.0% from the current market price. The brokerage upgraded its target from the previous ₹7,081, citing the company's resilient performance in Q3FY26 despite seasonal challenges.

Strong Q3FY26 Financial Performance

LTIMindtree delivered solid results in Q3FY26, demonstrating operational resilience despite furloughs impacting the sector. The company's financial metrics showed consistent improvement across key parameters.

Contract Wins and Business Growth

The company's contract performance demonstrated strong momentum with robust total contract value growth. LTIMindtree's last twelve months total contract value reached $6.50 billion, marking a 12% year-on-year increase. This growth was driven by multi-year wins across diverse technology domains including managed services, modernisation, cyber security, data analytics, AI and AI-agent deployments.

Sector-wise Growth Distribution

The revenue growth was broad-based but showed particular strength in specific sectors and geographies. Manufacturing & Resources segment grew 9.4% quarter-on-quarter, while Healthcare & Public Services expanded by 9.9%. Geographically, Europe contributed 3.4% growth and Rest of World delivered strong 14.1% growth, driven by execution excellence and wallet share gains in select markets.

Strategic Positioning and Outlook

Anand Rathi noted that clients are consolidating their technology spending with fewer strategic partners while funding 'run + modernize' programs alongside targeted AI-led transformation initiatives. The brokerage identified that top 5 client headwinds are primarily productivity-cycle issues expected to bottom out by Q4FY26, which should establish a more growth-oriented client mix going forward.

The research house believes that once current headwinds fade, vendor consolidation will become a wallet share opportunity rather than a risk factor. This positioning supports the maintained BUY recommendation with the revised higher target price of ₹7,375.