Shares of Larsen & Toubro (L&T) gained 1 percent to scale a 52-week high of Rs 3,560 per share on January 8 intraday deals after brokerage firm UBS shared a 'buy' rating on the counter, raising the target price to Rs 4,400 from Rs 3,600, implying an upside of 23 percent from current levels.
The L&T stock later cooled off from the day's high to slip in the red at Rs 3,506, as of 12:10pm.
In the past three months, the stock of this capital goods major has surged over 13 percent as against an 8 percent rise in the benchmark Sensex.
Follow live blog for all the market action
Analysts at UBS said that L&T's strong order cycle and robust execution should lift the margin prospects going ahead.
"At 1x PEG, we believe that the L&T stock is attractive and raised core price-to-earnings (PE) multiple to 30x from 26x. We believe that core earnings, returns will improve going ahead and new orders will continue to remain robust. Apart from that, core cash flow and return on capital employed (ROCE) are critical for consistent growth," the brokerage firm highlighted in its rating rationale note.
Earlier, the company informed that it has completed the sale of its entire stake in L&T infrastructure Engineering to STUP Consultants.
Also read: Kings of consistency: Nifty stocks which have regularly outdone the benchmark
That apart, L&T's construction arm secured key orders in the Middle East recently. "In the UAE, the business has received an order for engineering, supply, construction, installation, testing and commissioning a 400/132 kV substation. The scope also includes associated transformer, reactor and substation control and monitoring systems (SCMS)," read the filing.
The company also won an order to set up 400-kV overhead transmission lines along with associated 400-kV underground cable interconnections in Kuwait.
Disclaimer: The views and investment tips expressed by investment experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
