Reduce L&T - Target Price Rs.1625 - Kotak

Strong results but almost full valuations may preclude meaningful performance. L&T reported strong revenues, EBITDA margin and inflows though some chinks remain on contribution margin and Wcap. Large contribution of real estate and roads in 1HFY13 may become a headwind even as power and overseas business are opportunities.

Almost full valuations, 15X one-year forward P/E adjusted for Rs450 of subs value, may preclude outperformance; retain REDUCE (TP of Rs1,625 from Rs1,515).

Source : Equity Bulls

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