L&T Shrugs Off Geopolitical Heat: CLSA, Jefferies, Citi See Multi-Year Upside From $78B Order Book

Shares of engineering and construction conglomerate Larsen & Toubro (L&T) are drawing strong bullish sentiment from top global brokerages following a resilient first-quarter performance. Citi, Jefferies, and CLSA have all maintained positive ratings on the stock, citing robust order books, manageable cost pressures, and a status as a premier global capital expenditure play.

Larsen & Toubro Ltd.'s net profit for the first quarter of financial year 2027 rose 14% year-on-year, exceeding analysts' expectations. The company posted a consolidated bottom-line of Rs 4,123 crore in the June quarter, compared to Rs 3,617 crore in the year-ago period. The net profit beat the Bloomberg consensus estimate of Rs 3,985 crore. Revenue increased 6.7% year-on-year to Rs 67,942 crore from Rs 63,679 crore, ahead of the estimate of Rs 67,545 crore.

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L&T Q1 Brokerage Review

Resilient Q1 Margins, Maintained Guidance

Despite a slight miss on revenue, L&T's operational margins have remained largely intact. According to analysts at Citi, the company delivered a resilient Q1 performance with a constructive outlook on order inflows. While the engineering giant did face some margin headwinds during the quarter-primarily driven by a bump in Expected Credit Loss (ECL)-management commentary suggests that supply chain-linked cost pressures should remain highly manageable.

Crucially, L&T has maintained its full-year margin and annual 10-12% year-on-year revenue guidance. Global brokerage Jefferies noted that keeping this annual guidance intact strongly implies that the second half of the financial year (H2) will see accelerated growth and stronger overall performance for the infrastructure and engineering major.

A Global Capex Play With Massive Backlog

A major highlight for the quarter was L&T's robust order execution and inflows. CLSA highlighted a "Q1 order surprise," driven by an expanding total addressable market that now reaches into Europe, running parallel to sustained industrial capital expenditure drives within India. CLSA analysts noted that L&T is rapidly emerging as a "global capex cycle play."

According to CLSA, this is supported by a massive $78 billion order backlog-up 28% year-on-year-which appears remarkably solid even in the current macroeconomic environment. CLSA labelled L&T as the "most undervalued large-cap India industrials stock." The Group's consolidated order book as on June 30, 2026, was at Rs 7,78,954 crore.

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Geopolitical Headwinds Seen As Buying Opportunity

While global geopolitical tensions have weighed on the broader markets, brokerages see this as an entry point for L&T. Both CLSA and Jefferies view the recent stock weakness, which stems from cyclical factors and Middle East geopolitical tensions such as the Iran conflict, as a compelling buying opportunity. Jefferies believes that if global tensions ease, the stock should see a swift leg up to the Rs 4,278 level (where it traded when the conflict escalated).

Beyond that recovery point, Jefferies notes that clear earnings visibility will add further upside to the stock. Overall, most brokerages remain highly constructive on L&T's long-term growth trajectory. Analysts are confident that the company's commanding backlog and execution capabilities will comfortably steer it through the near-term global uncertainties.

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Brokerage Targets, Ratings:

Jefferies: Maintained a 'Buy' rating and hiked its target price to Rs 5,000 (up from Rs 4,885), the highest among its peers.

CLSA: Maintained an 'Outperform' rating with a target price of Rs 4,842.

Citi: Maintained a 'Buy' rating with a target price of Rs 4,650.

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