Larsen & Toubro: Analysts Optimistic Despite Recent Gains

Larsen & Toubro: Analysts Optimistic Despite Recent Gains

Larsen & Toubro: Analysts Optimistic Despite Recent Gains

Larsen & Toubro (L&T) has seen a significant rise in its share price, with a 46% increase in the calendar year 2023, far outpacing the Sensex’s 8% gain. Despite these gains, analysts remain bullish about L&T’s long-term prospects.

Key Reasons for Optimism

• Strong Order Pipeline: L&T’s diverse and robust order pipeline is a key factor driving positive sentiment. The company is expected to surpass its order inflow target of 10-12% and revenue growth forecast of 12-15% for FY24.
• Growth in Emerging Sectors: L&T’s involvement in rapidly growing sectors like green hydrogen, semiconductors, and data centers adds to its growth potential.
• Record Order Inflows: L&T reported a 72% year-on-year growth in orders in Q2, the highest-ever quarterly order inflow at ₹89,153 crore.

Analyst Views and Price Targets

• Elara Capital: Recommends ‘buy’ with a target price of ₹3,750. They highlight L&T’s hydrocarbon segment’s robust order inflows and potential for high EBITDA margins.
• Sanjay Moorjani, SAMCO Securities: Views L&T as a strong pick with a positive outlook based on high order books and involvement in emerging sectors. Recommends a target of ₹3,600 with a stop loss at ₹2,700.
• Jigar S. Patel, Anand Rathi Share and Stock Brokers: Advises booking profits around ₹3,000–3,100 and re-entering at ₹2,900–2,950.
• Santosh Meena, Swastika Investmart: Sees L&T in a short-term consolidation phase. A breakout above ₹3,100 could lead to targets of ₹3,400 and ₹3,800.
• Shiju Koothupalakkal, Prabhudas Lilladher: Suggests waiting for fresh buying near the ₹2,970 support level. A decisive breach above ₹3,115 may indicate further upward movement.

Investment Strategy

Investors should consider these insights while making decisions about L&T stock. The long-term trend appears strong, but some analysts recommend waiting for a correction or consolidation phase to conclude before buying. It’s important to monitor the stock’s performance against the broader market and sector-specific developments.

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VoM News Desk

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