Synopsis:- The stock gained momentum after a major brokerage upgraded it to ‘Buy’ with a ₹5,000 target, implying 25% upside. Strong Q2 performance, 10% revenue growth, 14% profit rise, a ₹6.67 trillion order book, and a ₹10.4 trillion pipeline underline sustained demand and robust long-term growth visibility.
India’s civil construction sector powers the nation’s growth, fueled by massive infrastructure pushes. In 2024, the market hit INR 22.77 trillion, set to surge 11.2% to INR 25.31 trillion in 2025, with a projected 8.8% CAGR through 2029 reaching INR 39.10 trillion. Government capex at INR 11.11 trillion for FY25 underscores this boom, alongside 57,299+ live projects spanning 17.4 billion sq ft.
With a market capitalization of Rs 5,60,370.38 crore, the shares of Larsen & Toubro Ltd closed at Rs 4,073.70 per share, increased around 1.71 percent as compared to the previous closing price of Rs 4,005.20 apiece.
Brokerage Recommendation
Goldman Sachs has upgraded the infra stock to a ‘Buy’ with a target price of Rs 5,000, signalling confidence in its growth outlook. The revised call implies a strong 25% upside from the previous Rs 4,005.20 level. The upgrade reflects improving fundamentals, robust order visibility, and expectations of sustained momentum in the infrastructure cycle.
Goldman Sachs sees L&T well-positioned to benefit from rising opportunities in defence, green hydrogen, and nuclear power. It estimates the company’s Total Addressable Market to expand significantly from Rs 1.4 lakh crore in FY26 to Rs 3.4 lakh crore by FY35, indicating strong long-term growth potential.
The brokerage remains optimistic due to L&T’s robust order backlog and improving domestic capex environment. It expects revenues to grow at a low double-digit CAGR and profits at a mid-teens CAGR over the next five years, reflecting sustained operational and demand momentum.
Financial & operational Highlights
L&T delivered steady financial growth, with revenue rising 10% to Rs 67,984 crore in Q2FY26 and net profit increasing 14% to Rs 4,678 crore. The stronger profit growth versus revenue signals improved execution and operational efficiency, reinforcing the company’s momentum amid a supportive capex and infrastructure cycle.
L&T generated ₹680 billion in Q2 revenue, driven mainly by infrastructure at 47%, followed by services at 28% and energy at 19%. Geographically, India contributed the largest share at 44%, while the Middle East accounted for 37% and the US/Europe 17%, reflecting a well-balanced global revenue mix.
L&T reported strong order inflows in Q2 and H1 FY26, rising 45% and 39% year-on-year, driven by infrastructure and hydrocarbon projects. The order book expanded 31% to Rs 6.67 trillion, with international projects forming 49%. A healthy Rs 10.4 trillion prospect pipeline further reinforces long-term growth visibility across domestic and global markets.
L&T’s Q2 FY26 order inflow stood at Rs 1,158 billion, driven primarily by infrastructure, which contributed 46%, followed by energy at 33% and services at 16%. Geographically, the Middle East dominated with 54% of orders, while India accounted for 35%, highlighting strong global diversification and sustained project demand.
Written by Abhishek Singh
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