L&T Shares Surge 4% on Strong Q4FY25 Results; Analysts Predict Up to 20% Upside

L&T Outperforms in Q4; Shares Rally on Positive Earnings Surprise

Shares of Larsen & Toubro (L&T) jumped nearly 4% to Rs 3,460 on May 9, following the company’s stronger-than-expected performance in the March quarter (Q4FY25). The engineering and infrastructure conglomerate reported a 25% YoY jump in consolidated net profit, touching Rs 5,497 crore, significantly up from Rs 4,396 crore in Q4FY24. Consolidated revenue increased by 11% YoY to Rs 74,392 crore, backed by improved execution in the core Engineering and Construction (E&C) business and strong order inflows.

Highlights:

• Consolidated net profit surged 25% YoY to Rs 5,497 crore.

• Revenue rose 11% YoY to Rs 74,392 crore in Q4FY25.

• EBITDA margin steady at 11%, matching the year-ago period.

• Order inflows jumped 24% YoY in Q4, signaling a healthy pipeline.

• Stock surged 4% intraday post results; YTD still down 5%.

Robust Order Pipeline Spurs Bullish Outlook from Brokerages

Brokerage firms remain bullish on L&T following the earnings beat, citing its strong order visibility, disciplined execution, and solid fundamentals. Bernstein retained its “Outperform” rating and set a price target of Rs 3,922, pointing to a Rs 19 lakh crore order prospect pipeline versus Rs 12 lakh crore earlier—a major growth driver for FY26. Motilal Oswal echoed this optimism, maintaining a “Buy” rating with a slightly higher target of Rs 3,950.

The brokerage also raised its inflow and execution estimates for L&T’s core E&C segment, although it slightly trimmed its overall valuation due to a markdown in the fair value of L&T’s IT subsidiaries. Motilal Oswal’s revised sum-of-the-parts valuation is based on 28x March 2027E earnings for the core business, applying a 25% holding company discount on IT subsidiaries like LTI Mindtree.

Highlights:

• Bernstein target: Rs 3,922; bullish on Rs 19 lakh crore order prospects.

• Motilal Oswal target: Rs 3,950; optimistic on execution and inflows.

• Both firms foresee 15–20% upside in the next 12–18 months.

• Valuation based on strong E&C fundamentals with adjusted IT segment value.

Management Forecasts Double-Digit Revenue Growth in FY26

Post earnings, L&T’s management struck a confident tone, forecasting 15% revenue growth in FY26. The company expects the strong order pipeline to translate into consistent inflows, projecting an additional 10% growth in orders in the coming 12 months. The commentary underscores continued traction across infrastructure, defense, and energy sectors—areas where government and private capex momentum remains strong.

Despite the market volatility from geopolitical developments, L&T’s management remains focused on maintaining healthy net working capital discipline, return ratios, and execution timelines—key metrics that bolster investor confidence in the company’s medium-term outlook.

Highlights:

• FY26 revenue guidance: 15% growth over FY25.

• Order inflows expected to grow by 10% over the next year.

• Core E&C segment remains a growth driver amid macro volatility.

• Management reaffirms focus on margin stability and capital efficiency.