Larsen & Toubro Ltd. share price target

Larsen and Toubro (L&T) reported almost a perfect quarter – beat in order inflow, strong revenue growth and >100% payout in the form of share buyback of INR 100bn, and a special dividend of INR 6 per share. Additionally, despite a higher prospective order pipeline of INR 10trn for 9MFY24, the management decided to err on the side of caution and has maintained its guidance of 10-12% growth in order inflow because of the risk presented by the general elections next year.

Q4 in line; FY23 order inflow and revenue beat guidance while margins were on par and order book soared to a record Rs 4tn

With strong ordering momentum in domestic market led by Centre, PSUs and private sectors, Larsen & Toubro’s (L&T) total order inflow (OI) witnessed robust growth of 21% YoY at Rs607bn (ex-services: Rs457bn, up 20%YoY) in Q3FY23. Current orderbook stands at a healthy Rs3.86trn (3.4x TTM ex-services sales), 26% of which is funded by multilateral agencies.

Q3 revenue ahead of estimates at Rs 464bn (+17% YoY); LT confident of exceeding 13-15% revenue and order growth guidance for FY23