Buy Larsen and Toubro; target of Rs 4179: Geojit Financial Services

Geojit Financial Services research report on Larsen and Toubro

Larsen & Toubro Ltd (L&T) is an engineering & construction (E&C) conglomerate with presence in IT and financial services sectors and operations in more than 30 countries. In Q1FY25, L&T revenue grew 15.1% YoY to Rs. 55,120cr, driven by robust executional order book in hand combined with accelerated contributions from international business to 48% vs 40% in Q1FY24. Order book stood all-time high at Rs. 4,909bn and the EBITDA margin was stable at 10.2%, as revenue cost mix remained the same.

Outlook

L&T delivered resilient quarterly performance in Q1FY25. Further, the recent government budget, increasing demand for international projects and a healthy order book in hand provide a positive outlook. Hence, we reiterate our BUY rating on the stock with a revised target price of Rs. 4,179 based on sum-of-the-parts (SOTP) valuation.