7 hours ago
Shares of Larsen & Toubro Ltd., the infrastructure and engineering conglomerate are trading with gains of as much as 5% on Friday, May 9, after the company reported its March quarter results after market hours on Thursday. The stock is one of the top gainers on the Nifty 50 index.
During its post-earnings call, the management said it expects revenue to grow by 15% in the financial year 2025–26 compared to the previous year. The company is targeting a core margin guidance of 8.5% in FY26.
L&T's overall order book stood at ₹5.79 lakh crore in FY25. The company secured ₹1.73 lakh crore worth of order wins in the infrastructure segment in FY25, with 61% coming from international markets.
The management expects international order momentum to continue and may consider supplying defence products to international markets over the longer term.
Order flow in Q4 grew by 24%, and the order pipeline is encouraging. The company expects a 10% growth in its order book over the next 12 months, leading into FY26.
Kotak Institutional Equities has upgraded the stock to 'Add' from its earlier rating of 'Reduce', and raised its price target to ₹3,650 from ₹3,400.
According to Kotak, strong guidance and an even stronger order pipeline indicate that L&T is defying broader macroeconomic trends. This also reflects the confidence its clients have in the company’s ability to take on larger-scale projects.
The brokerage added that improved procurement strategies and selective bidding are likely to support the pace of margin improvement.
Kotak also noted that L&T is expected to have a higher share of overseas projects in its backlog by the end of FY27, if not by FY26. That said, its ability to win and execute large-scale projects in the Middle East will be key to the scale-up of its international business over the coming years than broader macroeconomic conditions.
Emkay Global has maintained a 'Buy' rating on L&T, citing an attractive risk-reward profile. However, the brokerage has reduced its price target by 12% to ₹4,000, implying an upside of 20%.
Emkay wrote in its note that L&T's resilient Q4 performance was primarily driven by continued momentum in international project execution. Order inflow remained strong, with several marquee orders secured across geographies during Q4 and FY25. The management pointed to a considerably strong prospect pipeline of ₹19 lakh crore for FY26, up from ₹12.1 lakh crore in FY25, suggesting strong visibility for future order inflows, it said.
However, the brokerage cautioned that a slowdown in execution and delays in order inflow conversion due to geopolitical tensions remain key near-term concerns.
Antique Stock Broking has also revised its price target lower to ₹4,000 from ₹4,204 earlier. However, it has maintained a 'Buy' rating on the stock and remains positive on the long-term prospects of the company.
The brokerage has marginally trimmed its FY26 and FY27 earnings estimates by 10% and 6%, respectively.
Shares of L&T are currently trading 3.23% higher post its results at ₹3,431.10. The stock is still 13% away from its peak of ₹3,963.
