In a report released today, Nikhil Nigania from Bernstein maintained a Buy rating on Larsen & Toubro Limited (LT – Research Report), with a price target of INR3,922.00.
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Nikhil Nigania has given his Buy rating due to a combination of factors that highlight Larsen & Toubro Limited’s strategic positioning in key growth sectors. The company’s involvement in India’s defense sector is significant, especially with anticipated increases in defense spending driven by geopolitical tensions and a push towards indigenization. This sector, although currently a small part of L&T’s order inflow, is expected to grow, supported by government targets for defense production and exports.
Nikhil also emphasizes L&T’s prospects in the Middle East, where energy transition and hydrocarbon investments are driving a substantial increase in the company’s energy prospects pipeline. Additionally, in India, despite a temporary slowdown in power demand growth, the medium-term outlook remains robust with significant capital expenditure expected in power generation and transmission. L&T is well-positioned to capitalize on opportunities in thermal, nuclear, and grid sectors, which supports the Buy rating.
In another report released on May 12, Nomura also maintained a Buy rating on the stock with a INR3,670.00 price target.