'Buy' L&T Shares Maintains Motilal Oswal, Sees 12% Upside — Here's Why

L&T management is optimistic about the opportunities in the Middle East and expects L&T to benefit from continued ordering growth of 10-15% for the next five years from this region..NDTV Profit’s special research section collates quality and in-depth equity and economy research reports from across India’s top brokerages, asset managers and research agencies. These reports offer NDTV Profit’s subscribers an opportunity to expand their understanding of companies, sectors and the economy. .Motilal Oswal Report.Larsen and Toubro Ltd. is optimistic about the Middle East region and expects ordering to grow in the midteens over the next five years from this region. Sector diversification and country diversification within the Middle East help L&T tide over the volatility in oil prices. With private and government capex ramping up in select areas, L&T overall hopes to maintain mid-teen growth in order inflows in the medium to long term. Management remains focused on its capital allocation strategy and expects to hive off non-core assets soon and keep investing in new-age areas over the next five years. We maintain our estimates and Buy rating on L&T with an SoTP-based target price of Rs 4,500, based on 28 times two-year forward earnings..Key risks and concerns A slowdown in order inflows, geopolitical issues, delays in the completion of mega and ultra-mega projects, a sharp rise in commodity prices, an increase in working capital, and increased competition are a few downside risks to our estimates..Click on the attachment to read the full report:.India Stock Market Strategy: Nifty 500 Sees Broad-Based Growth Amid Challenges Says Motilal Oswal— Read Report.DISCLAIMERThis report is authored by an external party. NDTV Profit does not vouch for the accuracy of its contents nor is responsible for them in any way. The contents of this section do not constitute investment advice. For that you must always consult an expert based on your individual needs. The views expressed in the report are that of the author entity and do not represent the views of NDTV Profit..Users have no license to copy, modify, or distribute the content without permission of the Original Owner.

'Buy' L&T Shares Maintains Motilal Oswal, Sees 12% Upside — Here's Why

Motilal Oswal maintains its estimates and continue to value L&T at 28x P/E on two-year forward earnings for core business and 25% holding company discount for subsidiaries.

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