JPMorgan has issued a bullish call on Larsen and Toubro, indicating strong upside from current levels.
What Happened: JPMorgan initiated coverage on Larsen and Toubro with an "overweight" call and a target price of ₹4,360, indicating an upside of 25% from its previous closing price.
The brokerage said the company currently trades at 25 times FY26 core earnings per share (EPS) and expects the figure to grow at 23% annually over FY24-27.
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JPMorgan said the company offers an attractive combination of growth at a very reasonable valuation. The fast EPS growth will be driven by healthy core revenue growth of 16% and 60 basis points core margin expansion over FY24-27, the research firm added.
JPMorgan said the company is well suited to benefit from the capex tailwinds in India and the Middle East with its vast array of capabilities, large order book, strong balance sheet and cash flows.
In September, L&T won a "mega" order from build advanced grid systems in the Middle East. Mega orders are valued between ₹10,000 crore to ₹15,000 crore.
Price Action: Shares of Larsen and Toubro climbed 1.90% to ₹3,548.55 on Monday morning.
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