LTIMindtree shares tank nearly 7% as Q3 profit falls 11%. What should investors do?

Shares of IT services firm LTIMindtree slipped 6.5% to their day's low of Rs 5,987 on the BSE on Tuesday after it reported an 11% year-on-year decline in consolidated net profit for the December quarter, largely due to a one-time charge linked to the implementation of new labour codes.

Profit after tax (PAT) attributable to shareholders stood at Rs 971 crore, compared with Rs 1,085 crore in the same quarter last year. The company disclosed that the new labour regulations had a one-time impact of Rs 590 crore during the quarter.

Excluding this exceptional charge, adjusted PAT came in at Rs 1,401 crore, marking a 29% YoY increase and a 1.5% sequential rise.


Revenue from operations for the October–December period rose 12% YoY to Rs 10,781 crore, up from Rs 9,661 crore in Q3FY25. On a quarter-on-quarter basis, revenue grew 4%, compared with Rs 10,394 crore in Q2FY26.

Operating earnings before interest and tax (EBIT), excluding the labour code impact, stood at Rs 1,737 crore, reflecting a 5.4% QoQ increase and a 31% YoY jump.

In dollar terms, revenue reached $1,208 million, registering a 2.4% sequential growth and a 6.1% increase year-on-year. On a constant currency basis, revenue expanded 2.4% QoQ and 5.2% YoY.

The EBIT margin improved to 16.1%, expanding by 20 basis points QoQ, while net profit stood at $157 million, up 0.1% sequentially and 22.6% YoY. These figures also exclude the impact of the new labour norms.

What should you do?
Nomura has raised the target price to Rs 5,900 from Rs 5,800 while maintaining its Neutral rating on the counter. That translates to a downside potential of 7% from current market levels. The international brokerage believes FY26F will be a year of repair for LTIMindtree, as the company embarks on a phase of revenue acceleration and margin improvement following the appointment of a new CEO. The brokerage expects momentum to build through the timely ramp-up of already secured large deals, along with the closure of select opportunities in the pipeline.

Management commentary
Commenting on the results, CEO and Managing Director Venu Lambu described the quarter as a “strong” performance, crediting the outcome to the company’s AI-led strategy, sustained momentum in large deal wins, and operational excellence.

“This is our third straight quarter of delivering more than 2% growth, underscoring disciplined execution, strong technology-domain capabilities, and differentiated AI-driven offerings. Going ahead, our focus remains on profitable growth and delivering measurable value to clients,” Lambu said.

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