Press "Enter" to skip to content

Larsen & Toubro hits over 3-month low, stock down 11% in one month

Shares of Larsen & Toubro (L&T) hit an over three-month low of Rs 1,287, down 2 per cent on Wednesday, thue falling 3.5 per cent in the past two trading days, after media reports said Maharashtra Chief Minister has ordered a review of all projects/proposals cleared by earlier government in the last six months.
The stock of construction & engineering company was trading at its lowest level since August 26, 2019. Over the past one month, the stock has underperformed the market by falling 11 per cent, as compared to a per cent rise in the S&P BSE Sensex.

As per reports, major projects which are under review are mentioned as Mumbai-Nagpur Samriddhi Corridor, Coastal Road Link, Trans-Harbor Sea Link and Thane Creek. Apart from these, Bullet train project and Nanar refinery in Ratnagiri are also kept on hold.
According to Dalal & Broacha Stock Broking, in current order book L&T has total exposure of around Rs 42,700 crore in Maharashtra (14 per cent of total order book). The brokerage firm believes that major projects being kept under review and any delay in execution might impact L&T’s execution cycle.
“L&T management has highlighted that there is no clarity from the government yet and they are reviewing the situation. Although order inflows have remained weak in Q3 for L&T, we expect robust order book and international order wins are likely to be savior for the company,” analysts said in a company update. It maintains ‘buy’ rating on the stock with the target price of Rs 1,685 per share.
Meanwhile, L&T in a regulatory filing today said the construction arm of the company has secured significant orders from prestigious clients across various Indian states for its varied businesses. The orders fall under “significant” category which ranges between Rs 1,000 crore and Rs 2,500 crore.
In Maharashtra, an empanelment and rate contract has been awarded to provide off-grid DC solar photovoltaic water pumping systems with standalone lighting systems for farmers in the Aurangabad, Nashik and Pune revenue divisions. These systems will have provision for mobile charging, transfer of automated meter reading and water discharge reading data, the company said.

Source: Business Standard