Earnings call transcript: LTIMindtree Q2 2025 sees record EPS, strong growth

LTI Mindtree Ltd (LTIM) reported its second-quarter earnings for fiscal year 2026 on October 16, 2025. The company’s performance was marked by significant revenue growth and a record high in earnings per share (EPS), alongside a positive market response. The stock saw a modest increase of 0.23% following the announcement, reflecting investor confidence in the company’s strategic direction and financial health. According to InvestingPro data, the company maintains a "GREAT" financial health score of 3.47, supported by strong liquidity and consistent dividend payments over the past decade.

Key Takeaways

• LTI Mindtree reported a record EPS of Rs. 47.2.
• Revenue for Q2 FY’26 reached US$1.18 billion, with sequential growth.
• EBIT margins expanded by 160 basis points to 15.9%.
• The company declared an interim dividend increase of 10%.
• Order inflow surged by 22% year-over-year to US$1.59 billion.

Company Performance

LTI Mindtree demonstrated robust performance in the second quarter of fiscal 2026, driven by strategic initiatives and a focus on AI-centric transformation. The company achieved a sequential revenue growth of 2.4% in constant currency terms and 2.3% in USD, showcasing its ability to capitalize on market opportunities despite global economic uncertainties. The strong performance was further underscored by a 10.1% quarter-on-quarter increase in profit after tax.

Financial Highlights

• Revenue: US$1.18 billion, representing a 2.4% sequential growth in constant currency.
• Earnings per share: Rs. 47.2, marking an all-time high.
• EBIT Margin: 15.9%, an expansion of 160 basis points.
• Interim Dividend: Rs. 22 per share, a 10% increase.
• Order Inflow: US$1.59 billion, a 22% year-over-year increase.

Outlook & Guidance

Looking ahead, LTI Mindtree is targeting near double-digit growth in the second half of FY’26. The company remains committed to expanding its margins and continuing its AI-centric transformation. Strategic investments in facilities and infrastructure are expected to support future growth, with a focus on developing a balanced portfolio. InvestingPro data shows that 4 analysts have recently revised their earnings expectations upward for the upcoming period, with revenue growth forecast at 9% for FY2026.

Executive Commentary

CEO Venu Lambu emphasized the company’s commitment to becoming an AI-centric organization, stating, "We are committed to becoming an AI centric organization in the agentic enterprise era." He highlighted the multifaceted impact of AI on client engagement, noting, "AI has multifaceted impact into the engagement. It goes beyond productivity."

Risks and Challenges

• Supply Chain Disruptions: Potential global supply chain issues could impact operational efficiency.
• Wage Inflation: Planned wage hikes in January and April may affect profit margins.
• Market Competition: Increasing competition in the AI consulting space could pressure market share.
• Economic Uncertainty: Macroeconomic factors, including inflation and geopolitical tensions, may pose risks.
• Technological Changes: Rapid technological advancements require continuous innovation to maintain a competitive edge.

LTI Mindtree’s Q2 2025 earnings call highlighted the company’s strong financial performance and strategic direction, with a focus on AI-driven growth and market expansion. The positive market reaction underscores investor confidence in the company’s ability to navigate challenges and capitalize on opportunities.

Full transcript - LTIMindtree Ltd (LTIM) Q2 2026:

Conference Operator: Ladies and gentlemen, good day, and welcome to the LTI Mindtree Limited Q2 FY ’twenty six Earnings Call. Please note all participants are currently in listen only mode and there will be an opportunity for you to ask questions following the conclusion of the management’s opening remarks. Please note that this call is being recorded. I now hand over the conference over to Mr. Sivatas Jadar, Head Investor Relations at LTI Mindray.

Thank you, and over to you, sir.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Thanks, Inba. Good day, everyone, and welcome to LTI Mindray’s Q2 FY ’twenty six earnings conference call. Today, we have with us on the call Mr. Venu Lambu, Chief Executive Officer and Managing Director and Mr. Ripul Chandra, Chief Financial Officer.

We’ll begin with a brief overview of the company’s Q2 FY ’twenty six performance, after which we’ll open the floor for Q and A. During the call, we could make forward looking statements. These statements consider the environment as we see today and carry risks and uncertainties that could cause our actual results to differ materially from those expressed in today’s call. We do not undertake to update any forward looking statements made on this call. I now turn the call over to Vedun for his opening remarks.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you, Vikash. Hello, everyone, and thank you for joining us on the call today. I’m pleased to share that q two f y twenty six has been a strong quarter for us, marked by broad based performance across our business. We are committed to becoming an AI centric organization in the agentic enterprise era. Our strategy remains on course, driven by sales transformation, fit for future program, and focus on large deals.

The results reflect disciplined execution and depth of our client relationships and solid progress in our ongoing transformation. Rupul and I will talk more about it during this call. Let me begin by sharing the headline numbers for Q2 FY twenty six. We reported revenues of US1.18 billion reflecting sequential growth of 2.4% in constant currency terms and 2.3% in USD terms. EBIT margins expanded 160 basis points from 114.3% in Q1 to 15.9% ahead of our plan.

Our order inflow stood at US1.59 billion dollars up 22% year on year, marking the fourth consecutive quarter of order inflow around US1.6 billion dollars We signed large deals in each of our five verticals. I would now like to highlight some of the noteworthy deals we won during the quarter. We secured a large deal with a leading global media and entertainment company to drive its digital transformation and enable an AI centric delivery model. We’ve been selected as a strategic partner by a global financial institution to deliver end to end technology and consulting services across all its line of business, spanning multiple geography, positioning as one of their five major service partners. We’ve been selected by global manufacturer of chemicals to oversee and execute their technology transformation in a rapidly evolving industry landscape.

We will deploy our Bluer’s tech to drive AI efficiency and streamline processes for cost management and rapid innovation. We expanded our strategic partnership with a global hospitality major through a significant multi year deal to accelerate their digital and guest loyalty transformation initiatives. We’ve been chosen by a leading fintech solution provider to deliver merchant certification services through an automation first approach. We have won a contract from the government of India’s Central Board of Direct Taxes to transform India’s pan infrastructure. Our recent press release highlights the win in detail.

We’ve been chosen as an AI partner by a global energy player to develop an agentic solution for legal and IT functions, leveraging BlueWorst Foundry, our agentic ecosystem platform that has gained strong traction with our global customers. We were chosen by a global media and entertainment major to create a Gen AI based solution designed to revolutionize both linear and non linear streaming platforms. By implementing an advanced AI powered video metadata extraction system, we will unlock the intrinsic value within their entire catalog from classic library titles to new release assets. We were selected by a Europe based life science company to lead a large scale ERP transformation, reimagining all key business processes through an S4HANA implementation. We have expanded our strategic engagement by winning a large deal with a technology major to drive cloud migration for the customer, enabling quicker time to market in a cost effective way.

These wins demonstrate our strong sales and delivery execution aligned with our changing expectation of our customers. Let me now share updates on our vertical and geography performance in U. S. Details. This is the second consecutive quarter of sequential growth across each vertical.

The growth was led by Consumer business, which grew 9.1% quarter on quarter. Healthcare, Life Sciences and Public Services reported strong growth of 10.2% quarter on quarter. Manufacturing and Resources experienced a growth of 1.7% Q on Q. BFSI grew 0.2 quarter on quarter, and Technology, Media and Communication reported 0.1% growth quarter on quarter. From a geo perspective, Americas grew by 2.1%, Europe by 2.4% and rest of the world by 3.7% sequentially.

It’s worth noting that each of our client revenue pyramid categories saw an addition on a year on year basis. Our headcount at the end of Q2 FY ’twenty six stood at 86,447. This reflects a net addition of 2,558 employees for the quarters, including 2,604 freshers. This quarter, we received several recognition. Let me highlight some key ones.

We won six gold and two silver Branton Hail Awards across various talent categories. We received a gold award for Excellence in Diversity, Equity and Inclusion Strategy at the Financial Express HR Awards twenty twenty five. We were recognized as the leader in the application development services for AI application in the Peak Metrics Assessment 2025 by Everest Group. We were featured in the AI Consulting Services Landscape Q3 twenty twenty five published by Forrester Group. Please refer to our fact sheet for a complete list of our recognitions.

Let me now take you through some of the key business updates for this quarter. We welcomed Gururash Deshpande as our Chief Delivery Officer. With over thirty years of experience in the large scale IT delivery, Guru will play a pivotal role in enhancing client delivery, embedding AI into our delivery framework and driving operational excellence. We hosted our first executive partner, Conclave, in California, USA, a milestone event attended by senior executives from hyperscalers and strategic enterprise partners. This event strengthened our mutual collaboration in driving AI centric solutions for our customers.

We were awarded patents for two specific AI centric innovation. The first one is method and system for managing financial well-being for customers, and the second is method and system for continuous clustering of SDLC artifacts. We launched our BlueVerse studios in Mumbai and London, which will serve as a collaboration hubs for our clients’ AI led transformation. We partnered with Shopify to set up an AI commerce center of excellence to create industry accelerators. We introduced BlueVirse RightAction, an AI governance framework that ensures compliant and intelligent decision making by autonomous agents.

We expanded our option of the Blue Earth Success Metrics Framework, a maturity and measurement framework now used by over 40 clients to convert AI vision into tangible business value. We developed an AI powered quality engineering framework for a global real estate major, streamlining story refinement or automating test case generation. This resulted in a 60% productivity improvement. We embedded AI across IT operations for a utility major, including service desk, autonomous agents, and monitoring. This resulted in significant cost saving, forex ROI or AI investment, enhanced employee experience, and IT resilience.

We created a Gen AI platform for sports goods manufacturer that automated customs declaration using NLP and proactive error resolution. This improved compliance from 35% to 97%. We have more than 1,500 digital agents in action in addition to our workforce. To emphasize our reskilling program, we are pleased to share that over 80,000 employees have completed the Gen AI Foundation training program. This program equips them with vital skill for applying AI in their work.

For financial updates, I will now hand over the call to Vipul.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Thank you, Venu. Good evening, everyone, and thank you for joining the call. Let me now walk you through the financial highlights for the 2026, starting with our revenue performance. Our Q2 revenue stood at US1180 million dollars reflecting a growth of 2.3% quarter on quarter and 4.8% year on year in dollar terms. The corresponding constant currency growth was 2.4% quarter on quarter and 4.4% year on year.

I’m

: pleased

Ripul Chandra, Chief Financial Officer, LTI Mindtree: to highlight that our Q2 revenue in INR terms has crossed INR 10,000 crore mark and stood at INR 10,395 or INR $3.94 crores. Our EBIT margin expanded by 160 basis points sequentially to 15.9% in Q2 FY ’twenty six. This increase was primarily driven by gains of 80 basis points from our margin improvement program, part of the Fit for Future initiative and non recurrence of Visa cost. ForEx tailwind contributed another 80 basis points. Profit after tax for the quarter stood at INR $13.81 crores as compared to INR $12.55 crores in the previous quarter, registering a growth of 10.1 quarter on quarter and 10.4% on year on year basis.

The effective tax rate for the quarter was 26.5% as compared to 27.3% in Q1. As mentioned previously, the higher ETR in Q1 was due to a one time tax impact on account of capital repatriation from one of the subsidiaries. EPS was Rs. 47.2 for the quarter compared to Rs. 42.3 in Q1 FY ’26.

This is at an all time high. Our total DSO for Q2 stood at eighty two days versus eighty one days in the last quarter. The operating cash flow to ratio was 85.6%, up from 82.3% in Q1. The free cash flow to PAT ratio stood at 72.4% compared to 60.7 in Q1. Cash and investment balances stood at around USD 1,580,000,000.00 or Rs.

14,000 crores compared to Rs. 12,835 crores in Q1 FY twenty six. Return on equity for the quarter was at 21.8. The Board of Directors has approved an interim dividend of Rs. 22 per equity share, an increase of 10% from the corresponding quarter of the previous year.

As of 09/30/2025, our cash flow hedges stood at USD 4,110,000,000.00 and hedges on the balance sheet were USD $241,000,000. Our utilization, excluding trainees, remained flat at 88.1% during the quarter. For the quarter, our trailing twelve month attrition decreased to 14.2% compared to 14.4% in Q1. On the ESG front, our global sustainability report for FY 2025 teamed a tapestry of progress aligned with international standards and frameworks was released. This quarter, we strengthened our employee volunteering efforts in CSR by organizing activities such as plantation drives, literacy programs, and initiatives supporting women in micro enterprise management.

I’m pleased to share with you that ATI ninety three Bangalore Global City Office phase one has been awarded deep platinum certification. This prestigious recognition is a testament to our commitment to sustainability and environmental responsibility. We have also been honored with the prestigious Golden Peacock Award for Risk Management in 2025. This recognition is a result of our continued commitment to industry best practices and aligning risk management to strategic goals.

: I will now hand it back

Ripul Chandra, Chief Financial Officer, LTI Mindtree: to Behring for the business outlook.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you, Vipul. In summary, our strong performance this quarter demonstrates our team’s unwavering commitment and deep trust our customers continue to have in us. As we look ahead, we remain confident in our ability to sustain this momentum of profitable growth, driven by strong deal wins, execution rigor, strategic transformation and investments in AI. Before we proceed with the Q and A session, I would like to wish you and your family a very happy Diwali. With that, let me now open the floor for questions.

Conference Operator: Thank you very much, sir.

: Ladies

Conference Operator: and gentlemen, we will now begin the question and answer session. We take the first question from Sandeep Shah of Equita Securities. Sir, could you please go ahead?

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Yeah. Can you hear me? Yes, sir.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yes, Sandeep.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Yeah. Yeah. Congratulation on a very strong execution, both on revenue and EBIT margin. Venu, first question is, if I look at the top five client bucket, the growth seems slightly tapered. And related question is looking at the top two clients, one in high-tech and one being BFSI.

Do you foresee any long term concern as these client may pause or face a hurdle in terms of your overall growth journey for a medium to long term?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. Thanks for the question, Sandeep. So, look, I think if you look at it across, you know, all our client buckets, we’ve actually grown. And as you rightly called out, the top five accounts, you know, had a had a different number. But, you know, there is a reason for it.

You know, it’s not related to the outlook or a demand. I think these are the top five large engagements we have. And these are the large accounts, which is going through recalibration, you know, because of the AI productivity benefit that they get. So we will have to transition that phase, And at the same time, should whatever the revenue we add, to some extent it gets offset by the AI productivity as we transition this phase. But once we are done through this phase, there’s no reason why we can’t grow in the stuff like clouds.

Right? So I don’t see any structural issue, not a material reason, you know, to be worried about in that in that particular segment. I think it is just a transition phase that we are going through in these in these five accounts, which is natural, I I guess, expected, you know, with the with the opportunity that exist in AI. And and those things get supplied when the renewal comes or any other existing engagements we may have. So you’ll have to look at slightly in a larger context on that.

The but I would look this as more as a transitionary phase.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Okay. And just a related question last time for the BFSI growth prospects, you were sounding slightly cautious. So is the outlook remain same or you become slightly more positive? And looking at your deal wins and the some support from the past through sales, even looks like the second half growth momentum could be better. And the last question in terms of EBIT margin, there is a significant improvement.

So where we are currently in the near term, where could be the trajectory? And then on medium to longer term, can we go to IT? We are already Can it be even higher teens in next three to four years?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. Look, I think with regard to the b s BFSI, there are, you know, two points I would like to call out. Right? So one is in the BFSI segment, we sort of entered the year at the back of a very strong year in FY 2025, right? So we need to look that phase, I actually call that as a pre productivity era phase, right?

So coming back at the back of that growth, and then as I spoke about, there is a recalibration happening at the time of renewals, which would offset some of the growth that we would get in this form of new engagements and new deals. That’s exactly what’s happening in BFSI space. It’s nothing to do with the market outlook being cautious or not. I think it is just the phase that I explained on the top five, the commentary I made with regard to the top five clients who sort of apply there. So I still remain, you know, I remain optimistic about the growth in the BFSI space, you know, as we go into the second half.

And in terms of the overall growth for the second half, yeah, absolutely, that’s the endeavor. Right? And I think I made this comment in the q one commentary, probably not in earnings call, the post earnings call and other interaction that, you know, our plan is to be nearer to the double digit in the second half of the year at some point. That’s what we’re working on. So that that don’t change.

On EBIT, I’ll request Ripul to give a comment, but I would expect that also to have a similar commentary. Sure, Vil. And thanks for the question. I think in terms of the

Ripul Chandra, Chief Financial Officer, LTI Mindtree: EBIT outlook, we remain confident in terms of being able to expand our EBIT margins as we go forward. We don’t give out our specific EBIT guidance for medium term, so I’ll refrain from doing that. But I think we are on a good profitable growth trajectory, and we remain confident to be able to maintain that. Okay. Thanks.

I may come in the follow-up. All the best.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you. Thank you.

Conference Operator: Thank you. We take our next question from Manik Panija of Axis Capital. Please go ahead.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Hi. Thank you for the opportunity, and congratulations for the very steady performance that you’ve shown in the current quarter. You did allude to some pressure within your top customers, but given some of the large deal wins that we have won in the recent past and some of the pass through revenues that typically tends to come through in second half, do you think the the strength that we see in ’26 may be higher than what we have historically seen. That’s question number one. The second question is with regards to reach hikes for your staff and and and also in terms of further gains from the Fit for Future program, how should we be thinking about them both for the near term and the medium term?

Thank you.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Sure. Thanks, Mani. Look, I think, you with regard to the commentary on H2, I think I made in the earlier question as well, remain optimistic and confident about delivering and continuing the same growth momentum in the second half. And if you have to deliver to the near double digit at some point in second half, obviously, we expect you know, the growth to be slightly higher than, you know, what we had in Q2, you know, as we look beyond the Q2. So that’s the plan we are working on it, and I’m fairly confident about, you know, the path that we take there.

With regard to the wage hikes, you know, we did announce the wage hikes to our, you know, our employees in our turnaround today, and the way we are going to approach is and before I share the approach, let me just take thirty seconds and give you a context on how we see, you know, the topic of wage hikes evolving. See, I think we’re going through a very significant inflection point in the industry and also within our company. And and there’s a of opportunities on the other side of the inflection point. So it’s very important that we navigate this journey collectively with our employees. And and one of the critical aspect of the journey traveling together with our employees is about how we, you know, cross scale and upscale our employees, you know, to the next AI, you know, requirement or AI projects that that keeps coming to us.

So in the agent AI era, the skill becomes a very critical element of that. So we’re take our employees along that skilling program, you know, and that’s already in progress and that will continue to accelerate. So we have fixed two milestones on how we address the wage hike. And and, you know, my personal view is that that may be the new normal going forward as well. We may not have a one wage hike in one particular quarter for all of employees.

We might spread it. So this time, we are making a beginning. We will have wage hike spread over two quarters. The first, you know, tranche will be in the effective January 1, and the second one will be in the April 1. And I would expect that we will have to adjust to the new normal that we will have two stages of increments coming in for, you know, our employee base.

You can assume that 50% in January 1 and 50% of our employees in the April 1. I think on the fit for future dates, Vipul commented on the earlier question, you know, where we are optimistic about continuing our margin momentum, and those gains are very critical piece to towards those goals. So and that’s going very well for us. And you saw that in our q one result. You saw that in our q two results, and that will start getting reflected even in q three and beyond.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: If you could talk about some of those margin tracks before you even historically, we used to talk about some of the G and A rationalization when the merger happened. If you could help us understand what are the those margin levers or the cost levers that you’re working on in which you expect to essentially see more tangible benefits. So I think we spoke about some of these levers earlier also, and I think this fit for future program or the margin focus remains a continuing focus area for us. And there are multiple levers in this program, but let me just touch upon a few of them that we are, you know, looking at. One is the productivity lever aided by AI adoption.

And as Vinu talked about, we have been adding revenue in our you know, in this year without really having a significant addition to our headcount. The second point the second lever which we are working on is pyramid correction, towards which our commitment for the pressure hiring program is continuing. And as we go along in the year, that will start reflecting in our pyramid as well. We are also working on our span of control, you know, internally, and we believe that there is more scope to do on this. And overhead also, while we have reduced versus the, you know, the beginning of the year, we still think there is more scope as well in that as also.

So there are multiple levers, and this is a continuing exercise. Thanks, Wish you all the best.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you.

Conference Operator: You. Our next question is from Vibhor Singhal of Nuvama Equities. Please go ahead.

: Yeah. Hi. Thanks for taking my question, and congrats on a solid performance team. I’ve got two questions, one for. So my question for you was on the, let’s say, the growth momentum that we are looking at.

So first of all, I think I would what I would want to check is that, I think we have two large deals, which should probably be ramping up at some point of time. So is it correct to assume that the PAN two point zero deal should start ramping up in q three and the recent media deal that we have won should start ramping up in q four?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. So the PAN two point zero, the early ramp up has started just about. Yes. You’re right. You can expect that to ramp up in q three.

But the media large deal, I think it will take a slightly longer time because it’s a it has got a very extended transition period. It’s a it’s it’s a deal where the existing scope plus the new incremental scope are getting recalibrated and reconsolidated. That’s how we’re redefining the entire IT landscape over there. And for that, there is a transition with multiple vendors that needs to be done. So I would expect so I would expect the, you know, the media ramp up media account ramp up to be over a period of couple of quarters.

: Got it. Got it. You also alluded to maybe possibly touching a double digit growth in terms of CC growth at some point of time in this year. Does that basically still hold and the recent deal wins and the growth in this quarter, does that align with the target that you’re looking at?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. Yes. I think, you know, I I I as I said, you know, we want to be, you know, nearer to the double digit or double digit. You know? There’s always that bit of a leeway we kept to see how things unfold.

But the idea is that can we come closer to the double digit or actually get to the double digit? That plan is pretty much still in progress.

: In FY twenty six. You you mean to say in the remaining two quarters? Yeah.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. At at some point in the second half of the year Got it. You know, we will, you know, we will have that growth coming in. And, you know, I think I clarified it in the, you know, the last calls as well that, you know, we’re looking at that in The US details. So

: Got it. Got it.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Great. Great to

: Great to hear hear that, that, you you know. Know.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Thank you. Yeah.

: We will just one question on the margin side. I think this quarter, we saw a very sharp reduction in SG and A from 12.8% of revenue. It’s come down to 11.7, so almost 100 basis point benefit from that. So first of all, is that sustainable? And secondly, is there more room for this to come down in the fit for future program that we are running?

Ripul Chandra, Chief Financial Officer, LTI Mindtree: So before two points or two parts to that answer, One is in coupons, there is normally a seasonal pickup in the SG and A cost because of certain marketing events, etcetera, which typically come seasonally in that quarter. Those were not there in this quarter. Number two, as I just said that the Fit for Future program is a continued program, and there are further levers that we are working on. So we are working on improving even this, you know, parameter further.

: Got it. Got it. Thank you so much, Akum. This was as clear as possible. Thank you so much, guys, for taking my questions, and wish you all the best.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you, Bhagavad.

Conference Operator: Thank you. Before we take our next question, we’d like to remind participants to join the question queue. You may click on the raise hand icon. We take the next question from Varun Sabhu from Anandrati. Go ahead.

Shubhrant, Analyst, Anandrati: Shubhrant here from Anandrati. So just quickly, thank you so much for the opportunity, and congratulations on a fantastic set of numbers. Just one question. Specifically, when we are looking at almost 60% of your revenues, which are coming from two sectors, that has been basically flat. How do you see that evolving over the there is any client specific issues that are there?

And the other bit is, do you see a structural change in your vertical mix over a period of time? I have another question, but I’ll just wait for your answer.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: You know, I think, know, Varun, I I would sort of link it to the you know, I I would link it to even the top five commentary to this answer as well. Because, obviously, you know, if you look at it in the in the top five client base, I spoke about recalibration at at the back of productivity that’s happening. So there is this one element of it because that also has, you know, accounts which falls into this 60% segment that you’ve called off. So that is one. And second thing is that, you know, the commentary I made with regard to the VFSI is that, you know, we’re coming at the back of the strong growth last year.

And then we had the renewal cycle coming in, which sort of led to this recalibration. And, you know, I expect that that is, you know, improve as we go along over the next two quarters. But with regard to the tech verticals, you know, I’ll just call on because that comes under the 60% thing that you spoke of. You know, I I look at that segment, you know, in in in two eras. Right?

So same time last year, you know, we were on, you know, what I actually call as a pre productivity era. Right? So that’s when the AI adoption and all that conversation just started, and then the acceleration happened about, you know, the productivity gain that we passed it on to few customers that you know about, you know, which we made a commentary last year. So post productivity era is what I would suggest, You know, I I I would sort of look at it starting from q three upwards. And in the post productivity era, we should start seeing the growth because it’s not fair to compare, you know, the year on year on that segment, you know, the pre productivity era because the things did change.

The price point did change. The renewal recalibration happened. We passed on the benefit to the customer as well at that time. Now now the thing is, you know, we we are seeing growth in all these segments, in the 60% of the segment that you called out. We have good pipeline traction.

In fact, if you look at the order booking in our BFSI, you know, was significant. It contributed, you know, materially for our 1,590,000,000.00 of order booking. So that’s that’s how I would summarize it, Varun.

Shubhrant, Analyst, Anandrati: Yeah. Thank you, sir. Just one more question. Do you see the productivity related benefits to be more specific to BFSI and high-tech and possibly manufacturing retail? It is comparatively lesser, or is that something that I’m construing basis what I’m seeing as such from a sectoral perspective?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Well, I the way I would look at it is that the larger the engagement, the the larger the account size, the the impact is more material. Right? So that’s how we would say. But AI infusion is what we want to encourage across all of our customers, across all of our segments, all of our customers. Right?

We have increased it more than forty, fifty accounts adopting AI in this quarter as I covered in my in my initial commentary. So that’s how it works. I think it’s just the size and scale of the account and segment where you start seeing that impact materially. Thank

Ripul Chandra, Chief Financial Officer, LTI Mindtree: you so much.

Conference Operator: Thank you. We will now move to our next participant. That’s Devashish Majumdar of Spawn Investments. Please go ahead.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Hope I’m audible.

Conference Operator: Yes, sir. Yes,

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Thanks for the opportunity, and congrats on good set of numbers. Sir, my first question was around the deal wins. So for the past almost three, four quarters, the the deal wins have been similar range, but but but our top line growth has been steady or we have started to see some acceleration there. So how should I link these two things, both of them, give you so I could have some flavor around the deal wins also? Can how should I relate both these things?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. So, you know, there are three attributes, you know, if you want, you know, in in in the topic of relating the order booking, you know, to the revenue. Right? You know, firstly, know, we we have shown quarter to quarter progress. Right?

I mean, that’s that’s a reflection of the order booking translating into the revenue. But we need to understand that the order booking has, you know, three factors. The one is what is the transition period for these last deals before it sort of materializes into steady state revenue? And I as an example, I called out the media customer. It has a longer transition period.

The one which we announced in q one, that has already been transitioned. Right? So we are we’re getting into a steady state, so we’ll start seeing the revenue coming in. So each of these deals have a different characteristics in terms of how the trend what is the transition period and how much it sort of ramps up. And the second thing is that, you know, the the renewal deals are getting clubbed with the vendor consolidation deals.

Right? Even the the recent last deal that we announced, it’s a it’s a great case study of our existing scope plus taking over the scope of the other vendors through the vendor consolidation strategy makes the deal bigger. And when you look at that, the vendor consolidation is over a multiyear period because you consolidate two vendors, then you move to the third vendor and fourth vendor. So that’s how the second attribute of it. And the third is some of our renewal deals gets recalibrated to a new, you know, price point as we go along.

So, you know, that’s how we have to look at it. The the only summary I would limit it is that, look, we are fairly confident of where we are going in the next second half of the year, and we have enough momentum that’s backing us up on that.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Understood. Understood. And, sir, my second question was specifically the commentary you just alluded to of the large customers having the having the impact of AI. So, you you have been talking about that even in the calls before, and the other players or peers in the industry have been talking about change of scope in the larger player. So, so, just wanted to understand, does it have to do a lot more do with macro specifically that that these deals are getting or the existing book of work is also under pressure or is this to do more with AI?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: So I think it’s more to do with The macro was probably a couple of quarters back, you know, that would have been triggered. But now AI, you know, if we encourage our customers to leverage AI in in the engagements. We actually, you know, proactively champion the partnership of AI infusion and our existing equipment. You know, I don’t think we’ve gained anything by holding it, holding into that. You know, it’s the right strategy is to let go what is right productivity gain to our customers because we win back more.

We win back more what, you know, compared to what we give. It is just that it’s a transitionary phase, you know, we have to look at what is the scale of growth that comes in over a period of time. And, you know, we are seeing that in our accounts. You see that in our results. You know, while we are passing the productivity benefit, we still grew.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Understood. Understood, sir. So just just a continuation on that part, a clarification. So could you quantify some sort of AI revenues or or has it reached to a monetization phase for us? And some some levels of revenue streams or percentage would you be able to guide us to?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: You know, at the moment, we are not, you know, because, you know, there is a pure play AI native services that we do on the Blue Earth’s agentic system. But there are a lot of other service line which contribute towards driving the AI solutions, whether it’s our cloud business or digital engineering business, data, most importantly, and so on. So and, you know, till we come to a point where we can come with a much sharper definition of what is AI revenue, I think it’ll be a bit premature to start calling it out.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree: Got it. Thanks a lot. And best of luck.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you. Thank you.

Conference Operator: Thank you. We’ll take our next question from, Sulab Gobela of Morgan Stanley. Please go ahead.

Sulab, Analyst, Morgan Stanley: Yes. Hi. Am I audible?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yes. Yes, Sulab.

Sulab, Analyst, Morgan Stanley: Yeah. Hi. Thanks for taking my question and congrats on a strong quarter. My first question is on the deal wins and the pipeline. So in the last two quarters, we’ve had two mega deals in the ballpark range of, let’s say, $500,000,000 each.

So with respect to the, you know, current pipeline, would you would you characterize the current pipeline in having similar such size deals, which we are confident of closing in the near term? Or would you say that even without those, we’ll be able to maintain the level of deal wins that we’ve been doing?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Look. I think that, you know, there will be some seasonal moments here and there depending on the deal cycle that it takes to close deals. But, you know, as as as we’re looking at continuing our growth momentum and reaching to that number that I spoke of at some time in the second half, you know, I I would look forward to having the continued dual momentum. Right? I just don’t box it to a specific number at this moment.

But, you know, we have we have a robust pipeline, you know, fantastic deals in in discussions with our customer. That’s how we will go out. And and just to clarify to your point, you know, we did not announce the deal size on these on the second deal that you mentioned because the client has requested us to maintain the confidentiality. So I’m just calling that out. You know?

So that’s what the silence should on the scene as an acknowledgment of the deal value. So we did not we did not call that out. And also the deal that we announced recently is a great testimonial of a combination of our existing scope and the new scope. And that’s what we will see more and more in our existing accounts while we, you know, while we go after the new accounts with the newer deals as well.

Sulab, Analyst, Morgan Stanley: Understood. Understood. And my second question is on the margins. The the benefit on margins from levers such as, you know, productivity driven by, you know, infusion of AI. Historically, you know, whatever margin benefits the industry has seen, they found ways to pass it back to clients.

And particularly on levers like these, which is, you know, where the effort is getting reduced, would you say there’s something different this time around where such benefits can be retained by by the IT vendors?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Well, it depends on the type of engagement. Right? Our EBIT EBIT, you know, momentum is not just based on the AI productivity. It has got multiple factors as Vipul explained earlier. But when it comes to the AI productivity, you know, things like managed services, fixed price project, you know, the the development capacity based engagements, These are engagements where we have a an opportunity to keep the, you know, a part of it, if not full, of the productivity, you know, towards us.

Yeah. That’s how that’s how I see it. But that’s not the only lever. That’s one of the lever. That’s not the only lever.

Sulab, Analyst, Morgan Stanley: Okay. Understood. Yeah. And and just the last bit from a a third quarter perspective, I just wanted to check, given that the wage hikes are now coming in from the fourth quarter, do you have any headwinds going into the third quarter from a margin standpoint apart from the lower margin pass through revenues that were coming?

Ripul Chandra, Chief Financial Officer, LTI Mindtree: So I think the seasonal headwinds which are always there in terms of furloughs, etcetera, those are going to be there, but we still remain confident of being able to expand our margin further. So I don’t think we are expecting anything, you know, so so, you know, substantial, which can delay us right now. But that’s where we we stay confident on.

Sulab, Analyst, Morgan Stanley: Okay, sir. Thanks thanks for taking my question.

Conference Operator: Thank you. We now move to our next question. That’s from Ravi Menon of Macquarie. Please go ahead.

Ravi Menon, Analyst, Macquarie: Hi. Thanks for the opportunity. I have two questions. One, this new deal that we signed with this media major, you know, I thought that it was in October, early October. So is that included in the TCV?

And if it is, I mean, why was it included? Was it signed before the September 13?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: No. You’re about the the deal that we announced? Sorry. Ravi, could you come again, please? Yeah.

Ravi Menon, Analyst, Macquarie: The deal that you The deal that you announced, I think, early October, has that been included in this DLT CV?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Oh, yeah. It is included.

Ravi Menon, Analyst, Macquarie: So how come? You know? Because typically, we would include only things signed up to September 30. Right?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. It was signed in September. We announced it later on.

Ravi Menon, Analyst, Macquarie: Okay. Alright. Perfect. Thanks. And second to

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: The the the announcement has to go through a lot of approval process with client. So so when it got when when they said this is the effective date of the contract and this is the approval date or the announcement, that’s when we do because a lot of these deals have their their own clients own regulatory approval process as well. So we’ll have to wait till that till that thing that gets done. So we had an agreement and signed contract in September. So

Ravi Menon, Analyst, Macquarie: Thanks, Manas. And apart from your top five clients, it looks like every other segment is actually growing pretty well. So should we think about this top five as really being in that transition phase of productivity as you put it, and others will still have to see that kick in. The smaller customers will see this coming at a later stage.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Well, the others other type other segments are actually growing. So not sure what’s well, which part is the latest stage of it. If you look at six to 10 clients and sorry.

Ravi Menon, Analyst, Macquarie: Yeah. What I meant was, you know, will we see a similar pressure from productivity, you know, at a later stage with the top six to 10, top 11 to 20, and so on?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Look. It is not gonna be in a sequential basis that the top five first finishes and then the sixth and tenth comes later on in the queue. It it it doesn’t work like that because most of these clients are already, you know, in discussion and productivity. Right? Everybody wants productivity here and now.

It is just that I said, larger the engagement, larger the account, you see the impact being material. But, you know, we are in very constructive discussion and in fact, a proactive evangelizing AI productivity across all of our customers. And it’s it’s a sort of a parallel approach, Ravi. It’s not sequential.

Ravi Menon, Analyst, Macquarie: Understood. Thanks. And one last question. You know, we’ve now seen you win very large deals. I think that is a whole thesis behind the merger of LTI and Mindtree, and looks like that’s playing out.

But, you know, how about the legacy modernization side? I think, you know, are are you in a good position to compete against incumbent vendors there?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. Look. I think margin was three years back. I think we should move on from that point in front of you. Right?

Because the market has changed. You know, the the the capabilities that clients wants, you know, are are different than what it was three years back. And and also, you know, the the decision making parameters to award a large deal also has fundamentally changed. So we are we are sort of playing out in a we we have a new playbook now. We have which sort of suits into the new market segment that we’re addressing.

The same customers, but with the new expectations is what we’re addressing. So I would sort of look at it as that most of these large deals are coming at the back of vendor consolidation and and also having a strategy of creating an AI road map. Along with that, of course, you modernize technology, modernize data, you modernize infrastructure, and so on. So that’s how I look at it.

Ravi Menon, Analyst, Macquarie: Thanks so much. Best of luck.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you.

Conference Operator: Thank you. We take our next question from Sudhir Guntupalli from Kotak Mahindra AMC. Please go ahead.

Sudhir Guntupalli, Analyst, Kotak Mahindra AMC: Venu. Congrats on a good quarter. So just on this productivity issue, if I remember it right, I think we had gone through a couple of back to back quarters where we had seen stress because of this productivity issue in the top account. And then we called out that, that issue was completely behind. Now we are talking about this productivity pass on issue again.

Just trying to get some clarity whether this is a new issue in the same account or this was the overhang related to the same productivity pass on thing that has started three, four quarters back, it is still continuing. So any further clarity on this?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. Sure, Sudheer. We look firstly on the top client, I think, you know, we said we informed this in q four that the productivity commitments that we did to the top client is done. So that that topic is closed. I think my commentary with regard to the productivity is is is the new landscape in the market.

I actually don’t see this as an issue, honestly, as long as we continue to grow. Right? Because, you know, this is not well, this is an issue in terms of how much growth you can challenge in general for the industry, but productivity is a new normal. It’s a new normal till everybody transition into a new post productivity era on the existing book of business. So it’s gonna take, you know, a a different phase approach for different customers.

Somebody would go much faster. Somebody would go in a phased approach. So that’s what I would say. So I I don’t think it’s related to the top account at all. In fact, you know, we grew in this quarter, you know, in top account.

So, sequentially, we grew in this quarter. So I don’t think that’s really issue. I hope that answers the questions today.

Sudhir Guntupalli, Analyst, Kotak Mahindra AMC: Okay. So what what you might be referring to is maybe the other four accounts where you would have seen some productivity pass on issue and not related to the high-tech top account. Is that the correct understanding?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yes. I think I was answering in the context of top five clients, you know, having a different growth trajectory than the sixth and onwards. So it was more related to the top five customers because any larger engagement, larger productivity initiative is a material impact for that particular for that particular period.

Sudhir Guntupalli, Analyst, Kotak Mahindra AMC: Understood, sir. And lastly, you’re sounding very confident that we’ll reach double digit kind of growth rate sometime in the second half. But given that we also have sizable exposure to BFSI and High-tech, where we see significant amount of furloughs and very similar thing has played out a couple of years back. So any any sense on how the furloughs this time is going to be and and why we are confident despite the impact of that furloughs?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Look, I think the furloughs is going to be normal as what it always happens to be here. So we don’t see any signs of increasing it. But absolutely, yes. There’s a seasonal furloughs. It has been factored in when I made the comment, you know, a comment about nearer to the double digit, you know, sometime in second half, the furloughs has been accounted for.

Sudhir Guntupalli, Analyst, Kotak Mahindra AMC: Alright, Thank you, and all the very best.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you.

Conference Operator: Thank you. Our next question is from Sumeet Jain of CLSA. Please go ahead.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree0: Yeah. Hi. Thanks for the opportunity. Most of my questions are answered. I just had one question.

You are operating at a very high utilization of 88%, and you obviously have certain large deals to ramp up. So can you throw some light how are you planning the headcount around it? And in case you need any skill match mismatches there, will you be relying on subcontractors the way we saw this quarter?

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Yes. Sumit, I think in terms of the utilization levels, yes, you are right that it is slightly elevated. And we are working on, you know, you know, getting it into a more comfortable zone as we had called out earlier also between eighty six to 87%. I think our fresher hiring program that we are remaining committed to and under which we hired more than 2,600 freshers in this quarter We’ll start playing out once they get trained and they start getting deployed, and we are continuing to remain committed to hiring more pressures as well. So overall, we are working towards, you know, adjusting this along with our pyramid adjustment as we go along.

As far as sorry. What was the second part of your question? Yeah. On the subcon side

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: I mean, will you be

Ripul Chandra, Chief Financial Officer, LTI Mindtree: relying on subconvert? Yeah. Yeah. So it is a function of how the deals are coming in, how quickly they have to get ramped up. And, you know, if we have to rely upon subcons for the initial ramp ups, etcetera, that’s one way to, you know, do the ramp up faster.

And, yes, we will be we will be looking at that as well as a reward for, you know, maintaining the growth.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree0: Right. And, you know, maybe just harping upon the same point on top five accounts or rather not the top, but the remaining four accounts or let’s say in BFSI or high-tech verticals. How long do you see this transitory phase to be there where the AI productivity benefits have to be kept passing. So your double digit growth outlook or rather ambition by second half, I’m sure is independent of growth in these two verticals. So can you throw some light on how long is this transitory period in your view?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. You know, firstly, I think, you know, I I hope you all acknowledge that, you know, the other portfolios are growing, you know, beyond the industry average. Right? In fact, much higher than the industry growth. Right?

You know, which adds up to a a good well well balanced portfolio. Right? There is also a strategy of making sure that we have a well balanced portfolio because, you know, a few times you all have asked that are we dependent on, you know, few accounts a lot. So, you know, so I see this as also a transitionary phase for us where we, you know, end up creating a much more balanced portfolio. So that’s one overarching commentary I want to make.

Because if you look at it, most of the last deals that we got are outside of the top five. So that’s another great example to say how you how you bring more balanced portfolio. Now coming very specific to the, you know, the the period of transitionary phase, there is no one specific time line for, you know, let’s say, three or four accounts. Each of them are going through, you know, its own time line, but I don’t expect this to be a very long phase. You can expect, you know, the the progress happening from q three, q four onwards.

Right? It’ll each of them will go grow in a different proportion, so but some of them may take long time. But as I said, I I would urge you to look at a overall portfolio and and look at what we are doing in terms of balancing the portfolio right to to reduce the risk and, you know, especially to address the concentration risk where which some of you has spoken quite a few times with me. That’s that’s where I would live with. I hope I hope that answers your question, Sudhir.

Sivatas Jadar, Head of Investor Relations, LTI Mindtree0: No. Definitely. Definitely. I think congrats on a great quarter and great deal wins and a great ramp of going ahead. All the best.

Thank you.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you, Sumit.

Conference Operator: Thank you. We take our next question from Dipesh Mehta of MK Global. Please go ahead.

: Thanks for the opportunity. A couple of questions. So I think three questions. So first is about, let’s say, we are indicating about double digit growth entering into H2. Considering the deal pipeline and overall strong momentum what we are observing, whether it would set the base for FY twenty seven kind of expectation?

That is question one. Second question is about the net new portion in H1, whether it is different than the, let’s say, last four, six quarter what we observed in terms of net new in overall deal intake versus the past? Third question is about noncontrolling interest. This quarter, it seems to be much higher than usual pattern. If you can provide some sense what led to that jump.

And last, if I can add more, is more medium term. If you can give some sense about AI adoption across our top client, and what kind of impact you observed impact of AI on renewal? Thank you.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. What was the third question, Dipesh? If you can repeat that once again.

: Noncontrolling interest. If I look in p and l, it is around 20 odd crore, which used to be very small number only.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Okay. I’ll I’ll let Bipul to answer that, but let me let me take the the other question. Look. I think FY ’27 is still some time away to comment, so let’s hold on to that. There’s one big thing that we have to deliver is continue this momentum for the second half of the year and and, you know, and make sure that we come very, very close to the double digit at some time in the second half of the year.

So that’s how I look at it. I I I think it’s too premature to comment on FY ’27. So, you know, let’s talk sometime in in either January kind of time frame where I will be in a better position to comment on FY twenty seventh. I think the the the new dealer you know, most of the deals, you know, if you look at it as coming in in in leveraging our existing scope, doing the vendor consolidation in our existing customer base, and and then we also announced one net new account in q one, which was one of the last deals that we announced. So, you know, we we have a combination of both.

You know, we spoke about large deals across all of our five verticals. If you look at all these five verticals, you know, we have done some work with those customer at some part of the engagement life cycle. So that’s how we sort of done that. AI in top clients so sorry. I I lost the chain of question on that.

What was the specific question? The question? Yeah. In top clients?

: So I just want to get sense. AI adoption across our top line because you indicated forty, fifty client in one of your

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Oh, yeah. And

: any there in its impact on or in your how the size and scope changes?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. See, the AI infusion is something we are proactively, you know, driving it within the company. We have a framework called our app framework, which measures the skill sets in the account, the AI adoption maturity at different phases of it. In some some accounts, we are doing an AI in the follow-up of agents where you’re assisting the humans. So there, it’s not much about cost impact.

There, it could be more about, you know, how do you make employees work more effectively? How do you service customer more effectively? Right? So that’s one one form of AI infusion. The second is we are doing AI infusion in other category of accounts where we can make we can do more work with the same team.

That means you actually get more revenue keeping the same cost if it’s a fixed price kind of a project. The third one is that where we have a, know, discussion with the customer to drive more productivity so that we can pass on that benefit to the customer. So when I talk about AI infusion, doesn’t necessarily mean that I pass everything to the customer, and also doesn’t always mean that it’s always related to the productivity. AI has multifaceted impact into the engagement. It goes it goes beyond productivity.

So that’s what we are driving, and and we’re pretty excited about that adoption across our customers. With regard to the noncontrolling interest, Sumitul will answer Sure.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: So I think the answer to that question is that until last quarter, we were accounting for this this entity that we had set up in partnership with Aramco as a joint venture and equity method consolidation. During this quarter, there have been certain changes in the partnership arrangement between us, which now has allowed us to consolidate the subsidiary on a full line by line consolidation basis. So going forward, this will be a a full line by line consolidation.

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Thank you.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Hope that answers the question.

: Yes. It does. Thanks.

Conference Operator: You. We will take our last question from Sandeep Shah of Igora Securities. Please go ahead.

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Yeah. Yeah. Thanks for the follow-up. Just, Venu, sorry to stress again on top five. In terms of this process of AI calibration and the renewal where productivity gains are passed on, Do you believe we are not losing wallet share because such process could be intensely competitive where apart from an existing, there are other vendors are also being invited because these are named Fortune 500 clients.

So is it fair to assume our wallet share continues to remain defensive and it is not at a risk?

Venu Lambu, Chief Executive Officer and Managing Director, LTI Mindtree: Yeah. You know, firstly, you know, on on the top five commentary I made, just look at in the right context. Right? So when we are talking about the top five, we’re doing it minus 5%. Right?

So if you look at the overall, it’s not that material when I look at the overall I I I gave you a reason why it is happening because, you know, if you are just passing on the productivity benefit, you don’t just degrade minus 5%. It will be much higher. That means we are actually doing more business, but it is getting offset by the transitionary phase that we are going through some of these customers. Hence, you see that impact.

Right? So that’s that’s how, you know, you need to look at it. The second thing is that, look, these are the customers where we have relationship more than ten years. Some of them more than, you know, fifteen, twenty years. So we have a deep relationships.

So I absolutely don’t see this as as a red flag. You know, if we can help our customers to transition this phase successfully, there is a lot waiting for us on the other end. In fact, we are winning the deals in the same accounts. And I knew it was you know, it will start reflecting, as I mentioned, in different phases over the next few quarters, how this how these accounts will reflect as a net positive. You know, that’s that’s how I look at it.

So

Ripul Chandra, Chief Financial Officer, LTI Mindtree: Okay. Okay. And the last question before, sir, though there is a improvement in FCF to pack ratio, but with our scale now closer to some of the other large caps and margin increasing, can we go to industry standard of 90 to 100% FCF to PAT? I I think the answer to that is that, you know, the OCF to PAT, if you look at it, that should be closer to 90 to 100%, I would say. The FCF is a function of also how much of investments we are making in our capital expenditure side, which we which we have talked about in the last couple of quarters that we have continued to invest in our facilities expansion and also developing and, you know, modernizing our IT infrastructure internally, and that investment is going to continue.

So I think we are still investing in our business. And to that extent, FCF to pat ratio will probably remain where it is, and gradually, it will start moving up once we start, you know, coming to the desired capacity levels of the facilities. Okay. Thanks, and all the best.

Conference Operator: Thank you. Ladies and gentlemen, on behalf of LTI Mindtree Limited, that concludes today’s conference. Thank you for joining us, and you may now click on the leave icon to exit the meeting. Thank you all for your participation.

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