Accumulate Larsen and Toubro Ltd; target of Rs 4565: Asit C Mehta

Asit C Mehta report on Larsen and Toubro Ltd

Larsen & Toubro (L&T) is India’s largest engineering and construction conglomerate, renowned for its pivotal role in shaping the nation’s industrial and infrastructure landscape. Established in 1938, the company began as a partnership between two Danish engineers who aimed to build a strong local manufacturing base. Over the decades, it has grown into a diversified organization with operations spanning multiple sectors, including EPC (Engineering, Procurement, and Construction), manufacturing, defense, and financial services. Known for its emphasis on advanced engineering, project management expertise, and efficient execution, L&T has maintained a market-leading position by delivering large-scale, complex projects across India and beyond. The company boasts an extensive network of manufacturing facilities and project sites, backed by robust technological and innovation capabilities. Committed to sustainability and future-readiness, L&T continues to explore emerging opportunities in areas like green energy, digital infrastructure, and smart cities. These efforts, along with its diversified portfolio, ensure that Larsen & Toubro remains well-positioned to drive both national and international growth in the years ahead.

Outlook

Improving profitability in development ventures and stable commodity prices provide additional support. With an expected consolidated revenue CAGR of 11.9% from FY24 to FY26E, we recommend a ACCUMULATE rating with a SOTP-based target price of INR 4,565, based on FY26E earnings, reflecting its strong growth trajectory.