Result Update: Larsen & Toubro Ltd - ACCUMULATE - TP Rs.1274 - Kotak

- L&T reported mixed set of numbers. While the domestic execution gained momentum resulting in higher than expected revenue growth, there was pressure on margins. PAT beat our estimates aided by higher other income and lower tax provisions. However, order intake came in lower than estimates due to subdued overseas markets. On the positive side, there were improvements on the balance sheet front with the company reporting higher "Cash from Operations" and decline in working capital to sales ratio. The main trigger on the stock would be the award of major orders like LPD (~ Rs 200 bn). On forward earnings basis, L&T is trading at 22.9x and 19.1x FY18 and FY19 earnings respectively. We value the stock at 21x FY19 earnings and arrive at a price target of Rs 1274 (unchanged). Due to moderate upside, we maintain "ACCUMULATE", thereby advising clients to buy on declines.

Shares of LARSEN & TOUBRO LTD. was last trading in BSE at Rs.1174.35 as compared to the previous close of Rs. 1176.55. The total number of shares traded during the day was 110259 in over 4157 trades.

The stock hit an intraday high of Rs. 1183.95 and intraday low of 1167.95. The net turnover during the day was Rs. 129485751.

Source : Equity Bulls

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