Irani`s view on Larsen and Toubro

Mehraboon Irani, Principal and Head- Pvt Client Group Business, Nirmal Bang shares his view on Larsen and Toubro.

Irani told CNBC-TV18, “L&T result, not too much of expectations. I don’t think the numbers are going to disappoint and in terms of capital because it is an infrastructure company, the best part and the worst part for investors is that ultimately the way you book your contracts and the way you show it, ultimately that reflects in the figures.”
He further added, “What will be looked at by the market with interest is the fact that what guidance they give or what order book they talk about or what is the growth of the order book they are talking about in 2012-2013 that will interest the market is giving and quite a few people are already speculating that that is going to come much lower than what most people were expecting just about a couple of weeks ago and that is what the market is going to look like and there is disappointment on that particular front, I will not be surprised if the stock comes down.”
“I have been negative on PSU banking sector and I think the last word as far as quality assets has still not been heard. I think it is going to be painful at least for the next one-two quarters and I think some of the numbers if you ask me, shamelessly- some of the bank managements have gone to the extent of restructuring the assets and I promise you- we were all talking of the aviation sector and I think in the next one-two quarters we will be talking possibly with the State Electricity Boards (SEBs), the outstanding are huge, most of them are in very bad shape and most of the PSU banks have exposure to this particular space also. I think the restructuring of assets honestly leaves a very better taste, I know that valuationwise some of them are very attractive, like a Corporation Bank today is quoting possibly at 3.7.8.”