Priyanka Tiwari
Share
LTI Mindtree’s shares dropped nearly 5% after Citigroup announced plans to cut external IT contractors from 50% to 20%. The financial services giant is among LTI Mindtree’s top clients, making the IT firm vulnerable to this strategic shift. The stock hit a fresh 52-week low of ₹4,239 per share.
Citigroup’s technology head, Tim Ryan, shared the plan with employees through an internal presentation seen by Reuters. However, the timeline for the transition was not disclosed. The company aims to hire thousands of in-house IT professionals to reduce its reliance on external vendors.
Citigroup to Hire 2,000 Employees in 2024
As part of its restructuring, Citigroup plans to recruit nearly 2,000 IT professionals this year, aiming to expand its tech workforce to 50,000 employees. The company stated that this move aligns with its broader strategy to enhance security, drive efficiency, and support revenue growth.
The decision comes as US policies continue to favor local employment over outsourcing. While there is no direct mention of policy influence, the move aligns with previous trends under protectionist measures in the US.
Stock Market Impact: LTI Mindtree & Wipro Decline
Following the announcement, LTI Mindtree emerged as the top loser on the Nifty IT index, which itself dropped 0.59% to hover around 35,908. This decline marks a significant market reaction to Citigroup’s decision.
Other IT stocks also faced pressure, with Wipro, another IT services provider with exposure to Citigroup, witnessing a 1% decline, trading at ₹260.50 per share.
Leadership Changes at LTI Mindtree
Amid these challenges, LTI Mindtree recently appointed Nachiket Deshpande as the president of its new AI services business group. The move is part of ongoing senior management restructuring under CEO-designate Venu Lambu. Deshpande, the company’s former COO, was previously considered a front-runner for the CEO role, a position now set to be taken over by Lambu, who was announced as the CEO-designate in January.
