08 Jan , 2024 By : Debdeep Gupta
Shares of Larsen & Toubro (L&T) gained 1 percent to scale a 52-week high of Rs 3,560 per share on January 8 intraday deals after brokerage firm UBS shared a 'buy' rating on the counter, raising the target price to Rs 4,400 from Rs 3,600, implying an upside of 23 percent from current levels.
The L&T stock later cooled off from the day's high to slip in the red at Rs 3,506, as of 12:10 pm.
In the past three months, the stock of this capital goods major has surged over 13 percent as against an 8 percent rise in the benchmark Sensex.
Analysts at UBS said that L&T's strong order cycle and robust execution should lift the margin prospects going ahead.
"At 1x PEG, we believe that the L&T stock is attractive and raised core price-to-earnings (PE) multiple to 30x from 26x. We believe that core earnings and returns will improve going ahead and new orders will continue to remain robust. Apart from that, core cash flow and return on capital employed (ROCE) are critical for consistent growth," the brokerage firm highlighted in its rating rationale note.
Earlier, the company informed us that it had completed the sale of its entire stake in L&T Infrastructure Engineering to STUP Consultants.
That apart, L&T's construction arm secured key orders in the Middle East recently. "In the UAE, the business has received an order for engineering, supply, construction, installation, testing, and commissioning of a 400/132 kV substation. The scope also includes associated transformer, reactor, and substation control and monitoring systems (SCMS)," read the filing.
The company also won an order to set up 400-kV overhead transmission lines along with associated 400-kV underground cable interconnections in Kuwait.
0 Comment