Latent View Analytics is entering what ICICI Securities describes as a profit-accretive growth phase, prompting the brokerage to upgrade the stock to BUY from ADD. The firm has revised its 12-month target price to Rs 560 from Rs 480, implying an upside of roughly 22 percent from the current market price of Rs 459. The upgrade reflects growing confidence in the company’s ability to deliver 20 percent-plus USD revenue growth, expand margins, and monetise its strategic bets across GenAI, data engineering, and BFSI-led analytics services. Strong contract renewals, improving sales execution, and disciplined cost management are now aligning to create a more predictable earnings trajectory.

Investment Thesis: A Transition From Growth Optionality to Earnings Delivery

Latent View Analytics is moving beyond promise into execution. ICICI Securities’ upgrade rests on the belief that the company’s investments over the last 18 months—particularly in sales talent, data platforms, and next-generation AI—are now translating into measurable financial outcomes. With the December quarter emerging as a key inflection point for renewals, the absence of pricing or volume pressure on contracts has significantly de-risked near-term revenue visibility.

The brokerage continues to value the stock at 38x FY28E earnings, rolled forward by two quarters, arriving at its revised target of Rs 560. While the valuation remains premium, ICICI Securities argues that the multiple is justified given the company’s rising return ratios, expanding addressable market, and improving operating leverage.

Q3FY26 Preview: Seasonally Strong Quarter With Margin Upside

The December quarter is expected to reaffirm the growth narrative. ICICI Securities projects 6 percent quarter-on-quarter USD revenue growth in Q3FY26, driven primarily by continued momentum in BFSI, CPG, and retail, aided by cross-selling benefits from the Decision Point acquisition. In contrast, the technology vertical remains subdued as select large clients recalibrate discretionary spending.

On profitability, EBITDA margins are expected to expand by 50 basis points sequentially, supported by revenue scale benefits, INR depreciation, and increased near-shore delivery. While sales and marketing expenses may partially offset these gains, the broader trend points to structural margin improvement into FY27.

GenAI and Agentic AI: Expanding the Total Addressable Market

Artificial intelligence is no longer an experiment—it is a growth engine. Latent View generated approximately USD 7 million from GenAI and Agentic AI engagements in FY25, a figure expected to rise to USD 12–13 million in FY26, implying nearly 70 percent year-on-year growth.

The company is actively deploying AI across use cases such as cloud cost optimisation, churn analytics, synthetic data modelling, conversational dashboards, and CRM-LLM integration. These offerings allow Latent View to compete effectively with larger IT services firms while maintaining superior pricing power through specialised expertise.

Data Engineering Emerges as a Scalable Revenue Pillar

The Databricks partnership is proving increasingly strategic. Revenue from Databricks-linked work is expected to reach USD 19 million in FY26, up sharply from USD 11 million in FY25, keeping the company on track toward its USD 50 million FY28 ambition in this segment.

Latent View has invested aggressively in certifications, dedicated sales resources, and joint go-to-market initiatives. It is also positioning itself to capitalise on emerging opportunities arising from Databricks’ integration with SAP, particularly around large-scale enterprise data migrations.

Vertical Expansion: BFSI and Consumer Businesses Drive Growth

Sector diversification is improving earnings resilience. BFSI revenues are expected to grow 75–80 percent year-on-year in USD terms in FY26, with certain client accounts already approaching annualised run-rates of USD 5 million. Meanwhile, the CPG and retail vertical is benefiting from integrated analytics mandates spanning R&D, supply chain optimisation, and revenue growth management.

Geographically, traction in LATAM and Europe is helping reduce concentration risk, even as North America continues to account for the bulk of revenues.

Financial Outlook: Strong Earnings CAGR and Balance Sheet Strength

The financial trajectory underscores the strategic shift. ICICI Securities forecasts revenue to grow from Rs 8,478 million in FY25 to Rs 15,444 million by FY28, while net profit is expected to rise from Rs 1,735 million to Rs 3,069 million over the same period. EPS is projected to nearly double to Rs 14.9 by FY28.

Below is a snapshot of the forward financial profile:

Valuation and Stock Levels for Investors

ICICI Securities’ BUY call comes with clear investment markers.

Current Market Price: Rs 459

Target Price: Rs 560

Implied Upside: ~22%

Valuation Basis: 38x FY28E EPS

From a technical and positioning perspective, the stock has found support in the Rs 430–440 zone, while a sustained breakout above Rs 500 could accelerate momentum toward the target.

Risks to Monitor Despite the Upgrade

Execution remains key. ICICI Securities flags risks including high client concentration, elevated exposure to the technology vertical, dependence on developed markets, and integration challenges related to acquisitions. Any slowdown in large client spending or delays in AI monetisation could temper near-term expectations.

Bottom Line: A Higher-Quality Growth Story Takes Shape

Latent View Analytics is no longer just an emerging analytics specialist—it is evolving into a scaled, profitable AI-led data intelligence platform. With renewals stabilised, margins expanding, and next-generation capabilities gaining commercial traction, ICICI Securities believes the company is well positioned to deliver sustained earnings growth through FY27 and FY28. For investors willing to accept premium valuation in exchange for visibility and structural growth, the brokerage’s upgraded BUY stance signals renewed conviction.