The group’s IT twins, LTI Mindtree Ltd and L&T Know-how Providers or LTTS, collectively, look set to fall in need of the dad or mum’s acknowledged aspirations from 5 years in the past.
In 2021, the group’s IT companies introduced in ₹25,463 crore in revenues, accounting for about 19% of L&T’s consolidated topline of ₹135,979 crore. L&T’s bold five-year roadmap, dubbed Lakshya 2026, had then envisioned that the IT enterprise would develop and account for ₹73,980 crore, or about 27% of L&T’s income by the top of March 2026.
However, within the first 9 months of the present fiscal, the IT enterprise income totalled ₹39,419 crore, accounting for a few fifth of L&T’s ₹2,03,112 crore income.
With one quarter to go, dad or mum L&T’s consolidated income might cross its acknowledged objective of ₹274,000 crore, however the IT enterprise’s income seems set to overlook the goal. Assuming the 2 IT companies develop by 10% within the present fiscal, they’d finish with ₹53,546 crore, at the very least a fourth lower than the objective set 5 years earlier.
Emails despatched to LTIMindtree and L&T Know-how Providers, and dad or mum L&T, the nation’s largest engineering and development firm, searching for feedback on Sunday and Wednesday went unanswered.
Exterior headwinds
Each exterior and company-specific elements are behind IT companies’ underperformance in comparison with their rivals and to the engineering and development enterprise of dad or mum L&T, in line with three analysts.
First, a macroeconomic slowdown because of international uncertainty and the rise of synthetic intelligence has led many IT corporations to dial again progress targets. Then, US President Donald Trump’s tariff imposition set off a protectionist wave that made many Fortune 500 firms maintain again on their IT spending.
The Massive 5, together with Tata Consultancy Providers Ltd, Infosys Ltd, HCL Applied sciences Ltd, Wipro Ltd, and Tech Mahindra Ltd, are anticipated to report a tepid progress within the yr ended March 2026—the third straight yr of sentimental progress. They don’t seem to be anticipated to report progress upwards of 4.5% in fixed foreign money phrases for the total yr. Fixed foreign money doesn’t take foreign money fluctuations under consideration.
“After the covid pandemic, non-essential (discretionary) IT spending had lowered drastically, which is why the 2 firms didn’t develop at a tempo as soon as imagined,” stated Abhishek Pathak, lead analyst for IT companies and web at Motilal Oswal Monetary Providers.
L&T’s objectives for 2026 had been set assuming an IT growth after the pandemic., stated Amit Chandra, vice-president at HDFC Securities. “Nevertheless, the rise of automation leading to income deflation and low demand for IT companies due to tariff wars between international locations led the sector progress to drop from double digits to low single digits, which additionally damage the 2 firms.”
Management layer roiled
The development-to-software main additionally confronted inside challenges.
“The merger (of LTI and Mindtree) took longer than anticipated and there was a cultural mismatch. As well as, exits following the merger, together with unclear gross sales incentives for executives and an absence of gross sales rigour of the merged entity, hampered progress,” stated Chandra.
In Might 2022, L&T determined to merge Larsen & Toubro Infotech (LTI), which reported $2.1 billion in income in FY21, and Mindtree Ltd that posted $1.41 billion revenues that yr.
This merger led to management churn: first, LTI’s CEO Sanjay Jalona left after Debashis Chatterjee was appointed the CEO of the merged LTIMindtree in November 2022. Three years later, Chatterjee left in June 2025, earlier than the completion of his time period with the corporate making Venugopal Lambu the brand new CEO.
This, in flip, led to an exodus of different senior leaders from Mindtree and L&T Infotech, which consequently led to sluggish progress. Mindtree and LTI had reported a 31% and 26% progress, respectively, within the yr ended March 2022. The mergerd LTIMindtree’s progress slowed to 17.2% in FY23, adopted by a 4.4% and 4.8% progress in FY24 and FY25, respectively.
Lacking automotive progress
LTTS had its personal set of challenges.
“For LTTS, the corporate missed the auto ER&D wave, whereas friends, together with KPIT and Tata Elxsi, capitalized on it. They might not make a lot income out of the auto spending, which is without doubt one of the key contributing causes for not rising at a quicker clip,” stated Motilal Oswal’s Pathak.
To make certain, the corporate doesn’t individually spell out income from carmakers however golf equipment it beneath the mobility phase, which accounts for a 3rd, or $414 million, and is its second-largest vertical after tech firms.
LTTS’s mobility vertical grew 47% within the final three years whereas KPIT Applied sciences’ income from automakers greater than doubled to $666 million. To make certain, KPIT will get 96% of its enterprise from offering software program companies to automobile makers. Equally, Tata Elxsi’s income from its transportation vertical greater than doubled on this time to $213 million.
For now, the expansion at L&T’s mixed IT enterprise has slowed, as in contrast with smaller friends. Between March 2021 and December 2025, the mixed IT enterprise (together with LTIMindtree and LTTS) reported a compounded quarterly progress fee (CQGR) of three.74%. In distinction, smaller friends Coforge Ltd and Persistent Methods Ltd reported a CQGR of 6.52% and 6.64%, respectively.