HDFC Securities updated its outlook on LTIM, Federal Bank, Angel One, and L&T Finance following Q2 FY27 results. The brokerage lowered its target for LTIM due to margin pressure and missed estimates, while raising the target for Federal Bank, reflecting a selective view on the current performance of IT and banking stocks.
HDFC Securities recently adjusted its outlook on four major companies following their second-quarter financial results for the 2027 fiscal year. The brokerage maintained a generally positive stance on these firms, though it recalibrated its price targets to reflect recent operational performance and broader market realities.
In the IT sector, the brokerage trimmed its target price for LTIMindtree to ₹5,225 from ₹5,270. This update follows a quarter where the company’s financial performance fell slightly short of market expectations. While the company reported a 1.1% revenue growth quarter-on-quarter in constant currency terms—driven by demand in production and financial services—the technology and services segment continued to experience weakness. The company reported an operating profit margin of 15.6%, and its overall profit was affected by foreign exchange losses. Despite these immediate challenges, the brokerage anticipates a stronger second half for the fiscal year, projecting an annual earnings growth rate of approximately 15% through 2029. This growth expectation is supported by a potential recovery in banking and financial services spending and the integration of the Randstad acquisition.
The brokerage took a different approach within the banking and financial services sector. It increased the target price for Federal Bank to ₹365 from ₹355, signaling greater confidence in the lender’s current operational outlook. For other financial companies under its coverage, the brokerage maintained its existing targets, with L&T Finance at ₹320 and Angel One at ₹390. These decisions highlight a strategy that factors in both current profitability trends and the near-term challenges within the macro environment.
Investors may note that brokerage target adjustments act as a mirror for how companies are navigating the current fiscal year. For IT companies, the key monitorable remains the pace of client spending recovery, particularly in sectors that have faced recent headwinds. For banks and financial institutions, the focus for analysts often remains on credit growth and operational efficiency as interest rates evolve. These updates suggest that even within the same industry, analysts are increasingly distinguishing between companies based on their ability to manage costs and sustain growth.