Brokerage house Firstcall Research has recommended hold rating on Larsen and Toubro (L&T) with a target price of Rs 977, in its October 19, 2013 research report.
Firstcall Research report on Larsen and Toubro (L&T)
"Larsen & Toubro has recorded revenue of Rs 145095.10 mn for the quarter ended September 30, 2013, recording a y-o-y growth of 9.96 percent pick-up in execution of various jobs. The upward trend in the Order Inflow in the second consecutive quarter of the year. During the July-September 2013, the Company's Order Inflow at Rs. 265330 mn, recorded growth of 27 percent y-o-y. International order inflow more than doubled contributing 43 percent of the total order inflow on the back of a few orders for large projects in the Middle East. The major orders came from infrastructure and Hydrocarbon segments. As on Sep 30, 2013, the Company's order book at Rs. 1760360 mn, increased 11 percent on a y-o-y basis. The International order book constituted 15 percent of the total order book. The recurring Profit after Tax (PAT) for the quarter stood at Rs. 9775.10 mn."
"Infrastructure Segment achieved revenue of Rs. 71984.40 mn for the quarter ended Sep 30, 2013 registering a significant a growth of 36 percent, driven by Power Transmission & Distribution, Water & Renewable Energy, Building and Factories and Transportation Infrastructure business. International sales contributed 16 percent of the total segment revenue. The macro-economic environment continues to remain weak and uncertain on account of the twin deficits, tight liquidity, persistent inflation and heightened volatility in the financial markets. Investments climate in the economy is yet to show sign of recovery. Deferral of new projects and delayed decision making / execution features the weak performance of the core sector this far."
"With its growing order book, increased international presence and improved competitiveness, the Company is hopeful of meeting its growth operations in the near and medium term. Over FY2012-15E, we expect the company to post a CAGR of 9 percent and 4 percent in its top-line and bottom-line respectively. Hence, we recommend 'HOLD' for 'Larsen & Toubro Ltd' with a target price of Rs 977 on the stock," says Firstcall Research report.
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