LTTS - Investment Analysis

Last Updated Time : 02 Aug 25, 12:58 am

📈 Investment Analysis: L&T Technology Services (LTTS)

Investment Rating: 3.6

LTTS is a high-quality engineering services firm with strong profitability and low debt, but its current valuation and growth metrics suggest limited upside in the near term. It’s a solid long-term candidate for patient investors, especially if accumulated at attractive levels.

✅ Why It’s Worth Considering for Long-Term Investment

Strong Fundamentals

ROE (22.1%) and ROCE (28.3%) → excellent capital efficiency.

Debt-to-Equity (0.10) → virtually debt-free, enhancing financial stability.

EPS (₹120) → robust earnings base.

Dividend & Stability

Dividend Yield (1.28%) → modest but consistent.

Promoter Holding (73.66%) → strong promoter confidence

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Valuation Concerns

Stock P/E (36.0) > Industry P/E (31.8) → premium valuation.

PEG Ratio (3.43) → suggests overvaluation relative to growth.

Price-to-Book (≈7.46) → expensive compared to historical norms.

🎯 Ideal Entry Price Zone

Based on technical and valuation trends

Entry Zone: ₹4,050–₹4,250

₹4,250 is near recent support and below 50 DMA.

₹3,966 is the 52-week low, offering deep value.

Avoid entry near ₹4,600+ unless momentum improves.

🧭 Exit Strategy / Holding Period

If you already hold LTTS

Holding Period: Minimum 3–5 years to benefit from compounding ROE and sector tailwinds.

Exit Strategy

Partial Exit near ₹5,800–₹6,000** if price approaches ATH and valuation stretches.

Full Exit if PEG remains elevated and growth slows below 10% CAGR.

Trailing Stop Loss: Consider placing it around ₹4,000 to protect downside.

⚠️ Risks to Monitor

PEG Ratio (3.43) → growth may not justify current valuation.

FII Holding Decline (-0.34%) → institutional sentiment weakening.

MACD (-27.4) and RSI (44.8) → bearish to neutral technical signals.

Would you like a side-by-side comparison with other mid-cap tech stocks or a valuation model for LTTS?

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