Why Does Jefferies See More Upside Ahead for Larsen & Toubro?
Jefferies has reiterated its Buy rating on Larsen & Toubro (L&T) with a target price of ₹4,345. The brokerage believes the company remains firmly positioned to achieve — or even exceed — its FY26 guidance, reinforcing investor confidence in India’s largest engineering and construction conglomerate.
Over the past 6 months, 1 year, and 5 years, L&T has outperformed the Nifty benchmark by margins ranging between 1% and 201%. This sustained track record demonstrates the company’s ability to create long-term shareholder value, driven by strong project execution, strategic diversification, and prudent capital allocation.
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L&T’s business transformation continues to deliver operating leverage through better cost control and a high-margin project mix. The company’s strong balance sheet, growing order inflows, and steady improvement in execution efficiency position it well to capitalize on India’s capex recovery cycle.
Jefferies estimates that L&T’s core Engineering & Construction (E&C) EBITDA could rise by nearly 20%, up from the 16% average achieved during FY15–19. The expected improvement reflects both internal efficiency gains and favorable macro tailwinds in infrastructure, energy, and industrial investments.
The brokerage also highlights that L&T’s diversified project portfolio across transportation, hydrocarbon, and digital segments offers a natural hedge against sectoral slowdowns, ensuring stable cash flows and consistent order visibility through FY26 and beyond.
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While Jefferies remains optimistic, it notes that investors should monitor margin recovery trends and execution pace in large-ticket infrastructure projects. With the government’s capex momentum intact, the outlook for L&T’s order pipeline remains robust.
Investor Takeaway
Indian-Share-Tips.com Nifty Expert Gulshan Khera, CFP®, who is also a SEBI Regd Investment Adviser, observes that L&T’s execution strength, margin expansion, and steady diversification keep it well aligned for continued Nifty outperformance. Investors with a medium- to long-term view may consider accumulating on dips.
Explore more expert insights at Indian-Share-Tips.com, which is a SEBI Registered Advisory Services.
Related Queries
- ✅ What Makes L&T’s FY26 Guidance More Achievable?
- ✅ How Does Jefferies Compare L&T’s Margin Profile with Peers?
- ✅ Why Is L&T Considered a Key Play in India’s Infrastructure Growth?
SEBI Disclaimer: The information provided in this post is for informational purposes only and should not be construed as investment advice. Readers must perform their own due diligence and consult a registered investment advisor before making any investment decisions. The views expressed are general in nature and may not suit individual investment objectives or financial situations.
