L&T's Q1 net profit rose 14% YoY to ₹4,123 crore, beating guidance on orders and margins. CLSA, Goldman Sachs, Motilal Oswal retain positive ratings. Stock up 3.5%.
Larsen & Toubro shares jumped 3.5% on Wednesday after the engineering giant reported a 14% rise in first-quarter net profit to ₹4,123 crore. The stock traded at ₹3,959.10 on the BSE, up from the previous close of ₹3,832.75.
The company kept its full-year guidance unchanged across all key metrics. It targets order inflow growth of 10-12% and revenue growth in the same range, with core E&C EBITDA margin at 7.8% excluding realty. Working capital-to-sales is expected around 10%. L&T said near-term execution faces challenges from the Middle East conflict. It expects project awards to accelerate from the second quarter.
CLSA rates the stock outperform with a ₹4,842 target. The brokerage said L&T beat guidance on new orders and recurring margins, with working capital also topping estimates. Execution was the miss.
Goldman Sachs has a buy rating and a ₹4,370 target. It said L&T's plant and machinery core order inflow rose 17% in the quarter, well above its estimate of a 6% decline. Core EBITDA margins came in at 6.9%, 20 basis points below Goldman's 7.1% estimate, driven by lower execution in core segments.
Motilal Oswal raised its target to ₹4,550 from ₹4,500. The brokerage expects core E&C order inflow, revenue, EBITDA and profit to grow at a compound annual rate of 10%, 17%, 19% and 19% respectively over FY26-29. It cited risks from slower order inflows, project delays, commodity prices, working capital increases and competition.
Elara Capital kept its accumulate rating and ₹4,251 target. The brokerage said near-term execution should improve once supply-chain bottlenecks ease and order conversion picks up. Elara added that L&T is positioned to benefit from structural spending in energy transition and grid infrastructure, backed by a record backlog and strong bid pipeline.
In a separate announcement, L&T said its energy hydrocarbon onshore business won a major EPC order worth ₹5,000 crore to ₹10,000 crore from Kuwait Oil Company for Jurassic Light Oil export facilities and network upgrades.
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