LTM Sees 45% Surge in Q4 Profits, AI Push Deepens

Larsen & Toubro Group’s IT arm, LTM, reported a sharp jump in profitability for the March quarter, even as revenue growth remained modest and margins came under pressure, reflecting the ongoing shift toward AI-led delivery.

Net profit for Q4FY26 rose 44.6% sequentially to ₹1,387 crore, up from ₹959.6 crore in Q3. Revenue grew 4.7% quarter-on-quarter to ₹11,291.7 crore, indicating stable demand across key verticals. In dollar terms, revenue stood at $1.2 billion, up 1.2% sequentially.

However, operating performance softened. Earnings Before Interest and Taxes (EBIT) came in at ₹1,709.4 crore, down from ₹1,737 crore in the previous quarter. EBIT margins slipping to 15.1% from 16.10%. This, despite higher revenue, points to continued investment cycles and recalibration of delivery, particularly in AI and talent transformation.

The company’s board recommended a final dividend of ₹53 per share for FY26.

CEO and MD Venu Lambu positioned the quarter within a broader structural pivot. He said the company accelerated its shift to an AI-centric organisation, anchored by its BlueVerse platform and large-scale talent transformation. 

The company also pointed to efficiency gains under its Fit4Future program and a strong deal pipeline.

The AI narrative is increasingly central to LTM’s strategy. The firm is repositioning itself as a “Business Creativity partner,” blending AI, cloud, and data services. This aligns with broader trends across Indian IT, where firms are prioritising AI-led productivity gains over pure headcount-driven growth. 

The emphasis on platformisation through BlueVerse suggests LTM is moving toward reusable AI assets rather than bespoke services.

For the full year, the company reported $4.76 billion in revenue, up 6.0% year-on-year (5.3% in constant currency). EBIT margin expanded 90 basis points to 15.4%, while order inflow stood at $6.60 billion, up 10.3% YoY, indicating steady demand visibility.

Annual profit growth remained strong, with net profit rising around 45% over the trailing period, even as quarterly fluctuations persisted.

Compared to Q3, where revenue growth was similarly steady but profitability more muted, Q4 shows a clear improvement in the bottom line, albeit aided by operating leverage and possibly one-offs. The margin dip, however, underscores the cost of transitioning to AI-heavy delivery models.

With a healthy pipeline and rising deal sizes, LTM enters FY27 balancing two forces: near-term margin pressure and long-term gains from AI-led transformation.