Larsen & Toubro Limited (LT) AI Stock Analysis

• Market Cap: ₹5.41T
• Dividend Yield: 0.84%
• Average Volume (3M): 158.84K
• Price to Earnings (P/E): 26.4
• Beta (1Y): 1.13
• Revenue Growth: 13.33%
• EPS Growth: 21.25%
• Country: IN
• Employees: 54,303
• Sector: Industrials
• Sector Strength: 72
• Industry: Engineering & Construction
• EPS (TTM): 23.36
• Shares Outstanding: 1,375,580,900
• 10 Day Avg. Volume: 155,256
• 30 Day Avg. Volume: 158,836
• PEG Ratio: 2.55
• Price to Book (P/B): 5.00
• Price to Sales (P/S): 1.88
• P/FCF Ratio: 102.98
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: ₹4,790.67
• Price Target Upside: 17.60% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 6
• EPS Forecast (FY): N/A
• Revenue Forecast (FY): N/A

• Rating: 66 Neutral
• Price Target: ₹4,097.00 ▲(0.57% Upside)

The score is driven primarily by solid financial performance and a constructive earnings-call outlook (strong order inflows, order book growth, and improved working capital), partially offset by weak technicals (below key moving averages with negative MACD) and a relatively full valuation with a modest dividend yield.

Positive Factors

Record order inflows

A record quarterly inflow and a 30% YoY larger order book materially extend revenue visibility over multiple quarters, supporting sustained top‑line growth and utilization of engineering capabilities. Large backlog reduces short‑term demand cyclicality exposure and underpins multi‑quarter cash generation.

Improving profitability

Rising EBITDA margin and strong recurring PAT growth reflect improving operational efficiency across Projects & Manufacturing. Sustained margin expansion supports durable earnings power, better ROE, and greater ability to absorb project volatility while funding capex and strategic initiatives.

Working capital & cash flow gains

Material improvement in working‑capital intensity and a sharp uplift in operating cash flow enhance liquidity and reduce external financing needs. Improved collections and lower NWC ratio increase free cash flow potential and bolster ability to fund projects, deleverage, and invest in new ventures.

Negative Factors

Free cash flow decline

A severe drop in free cash flow and weak profit‑to‑cash conversion indicate structural execution or timing pressures in converting profits to cash. Persistently low FCF hampers capacity to support large project capex, acquisitions, dividends or meaningful debt reduction without relying on external funding.

Moderately elevated leverage

A D/E around 1.36 and modest equity share leave limited balance‑sheet cushion for project slippages or funding shocks. For a project‑intensive engineering firm, sustained leverage elevates refinancing and interest risks, reducing flexibility to pursue large strategic investments during downturns.

Energy segment margin pressure

Margin erosion in Energy from cost overruns on competitively bid legacy projects is a structural execution risk. Extended softness compresses consolidated margins, can drain cash via overruns and claims, and highlights vulnerability of high‑value project segments to contract pricing and execution difficulties.

Larsen & Toubro Limited Business Overview & Revenue Model

Company Description

Larsen & Toubro Limited engages in engineering, construction, and manufacturing operations worldwide. The Infrastructure segment engineers and constructs building and factories, transportation infrastructure, heavy civil infrastructure, power transmission and distribution, water and effluent treatment, and metallurgical and material handling systems. The Hydrocarbon segment provides engineering, procurement, and construction solutions for the oil and gas industry. The Power segment offers turnkey solutions for coal-based and gas-based thermal power plants, including power generation equipment with associated systems and balance-of-plant packages. The Heavy Engineering segment manufactures and supplies custom designed, engineered critical equipment and systems to the fertilizer, refinery, petrochemical, chemical, oil and gas, and thermal and nuclear power industries. The Defence Engineering segment designs, develops, produces, and supports equipment, systems, and platforms for the defense and aerospace sectors. This segment also designs, constructs, and repairs/refits defense vessels. The Others segment engages in the realty, smart world, and communication businesses, including military communications; marketing and servicing of construction and mining machinery and parts; and manufacturing and sale of rubber processing machinery. This segment also operates digital platforms, such as SuFin for B2B e-commerce; and EduTech for higher education and professional skilling. The company was founded in 1938 and is headquartered in Mumbai, India.

How the Company Makes Money

Larsen & Toubro generates revenue primarily through its diversified business segments, including construction and infrastructure development, which account for a significant portion of its earnings. The company undertakes large-scale projects, often through contracts awarded by government bodies and private enterprises, which provide a steady stream of income. Additionally, LT has a manufacturing segment that produces equipment and machinery used in construction and engineering projects, contributing further to its revenue. The company also engages in financial services, offering project financing and investment solutions. Significant partnerships with government agencies and multinational corporations enhance its ability to secure large contracts and projects, ensuring consistent revenue generation. Moreover, LT's focus on innovation and technology-driven solutions positions it well to capitalize on emerging opportunities in sectors like renewable energy and smart city initiatives, adding to its long-term revenue potential.

Larsen & Toubro Limited Financial Statement Overview

Summary

Strong income statement momentum (16.6% revenue growth and improved profitability) and a solid ROE support the score, while free cash flow deterioration (FCF down 65.5% YoY and weaker profit-to-cash conversion) and moderately elevated leverage (D/E 1.36) keep it below the top tier.

Income Statement

Larsen & Toubro Limited has demonstrated robust income statement performance with a solid revenue growth rate of 16.6% from 2024 to 2025. The gross profit margin stands at 15.7%, while the net profit margin improved to 5.9% in 2025. The company also maintains a healthy EBITDA margin of 14.9%, indicating strong operational efficiency. Overall, the company's income statement reflects a positive growth trajectory and improved profitability.

Balance Sheet

The balance sheet of Larsen & Toubro Limited shows a stable financial position with a debt-to-equity ratio of 1.36, suggesting manageable leverage. The equity ratio stands at 25.7%, indicating a moderate level of equity relative to total assets. Return on equity is strong at 15.4%, reflecting efficient utilization of shareholder funds. Despite the solid metrics, there is room for improvement in reducing leverage further to enhance financial stability.

Cash Flow

Cash flow analysis reveals a decline in free cash flow growth, which decreased by 65.5% from 2024 to 2025. The operating cash flow to net income ratio is 0.61, indicating a moderately strong cash conversion. However, the free cash flow to net income ratio of 0.32 suggests potential challenges in converting profits into cash. The company needs to improve its cash flow generation to support sustainable growth.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.69T	2.60T	2.25T	1.86T	1.59T	1.39T
Gross Profit	976.42B	949.77B	839.74B	727.93B	613.70B	520.88B
EBITDA	309.66B	297.04B	268.39B	231.50B	199.98B	185.33B
Net Income	158.69B	150.37B	130.59B	104.71B	86.69B	115.83B
Balance Sheet
Total Assets	0.00	3.80T	3.40T	3.30T	3.20T	3.11T
Cash, Cash Equivalents and Short-Term Investments	605.94B	604.34B	486.32B	544.37B	460.25B	450.01B
Total Debt	0.00	1.32T	1.16T	1.21T	1.26T	1.35T
Total Liabilities	-1.15T	2.64T	2.37T	2.27T	2.25T	2.23T
Stockholders Equity	1.15T	976.56B	863.59B	893.26B	824.08B	758.69B
Cash Flow
Free Cash Flow	0.00	47.42B	137.50B	186.33B	160.53B	210.36B
Operating Cash Flow	0.00	91.61B	182.66B	227.77B	191.64B	230.74B
Investing Cash Flow	0.00	-155.18B	21.63B	-83.12B	-36.68B	-56.59B
Financing Cash Flow	0.00	65.57B	-254.13B	-115.72B	-151.81B	-152.74B

Larsen & Toubro Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 4073.70
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For IN:LT, the sentiment is Positive. The current price of 4073.7 is above the 20-day moving average (MA) of 3909.13, above the 50-day MA of 3992.54, and above the 200-day MA of 3720.61, indicating a neutral trend. The MACD of -49.23 indicates Negative momentum. The RSI at 52.25 is Neutral, neither overbought nor oversold. The STOCH value of 71.67 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for IN:LT.

Larsen & Toubro Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
BEL	77 Outperform	₹3.28T	55.03	―	0.60%	16.58%	25.45%
CGPOWER	72 Outperform	₹919.33B	81.43	―	0.20%	25.63%	-26.61%
HAL	71 Outperform	₹3.09T	36.46	―	0.90%	3.05%	-0.57%
MAZDOCK	68 Neutral	₹1.04T	44.47	―	0.47%	12.22%	-9.22%
LT	66 Neutral	₹5.41T	26.38	―	0.84%	13.33%	21.25%
Sector *	63 Neutral	$10.79B	15.43	7.44%	2.01%	2.89%	-14.66%
SIEMENS	57 Neutral	₹1.10T	52.42	―	0.38%	-21.92%	-22.52%

Larsen & Toubro Limited Corporate Events

Larsen & Toubro Uploads Q3 and 9M FY26 Earnings Call Audio for Investors

Larsen & Toubro Limited has informed stock exchanges that the audio recording of its Q3 and nine-month FY26 earnings call, held on January 28, 2026, has been uploaded to the company’s investor relations website. The disclosure, made in compliance with SEBI’s listing and disclosure regulations, enhances transparency for investors and other stakeholders by providing direct access to the company’s earnings discussion and management commentary through the exchanges’ and L&T’s own digital platforms.

L&T Partners Indian Army to Upgrade and Sustain Pinaka Rocket Launcher Fleet

Larsen & Toubro has secured a supply order from the Corps of Electronics and Mechanical Engineers of the Indian Army to overhaul, upgrade and manage obsolescence for the in-service, indigenous Pinaka multi-rocket launcher systems. The partnership, which positions L&T as the private-sector OEM counterpart to the Army’s 510 Army Base Workshop, is designed to improve long-term operational availability and modernisation of Pinaka regiments by shifting from traditional maintenance to a structured lifecycle-based sustenance framework. Under an initial pilot phase, L&T and 510 ABW will jointly overhaul a Pinaka launcher and Battery Command Post, after which the Army workshop will take the lead on remaining systems while L&T continues to supply critical spares, technical support and quality oversight. The initiative reinforces the public–private partnership model in defence sustenance and lifecycle support, strengthening domestic capabilities for maintaining frontline artillery systems and supporting the broader ‘Made in India’ defence ecosystem.

Larsen & Toubro to Shut Trading Window Ahead of Q3 FY26 Results

Larsen & Toubro Limited has notified the stock exchanges that its trading window for dealing in the company’s securities will be closed from January 1, 2026, in line with its Securities Dealing Code and SEBI’s insider trading regulations. The blackout period is being imposed ahead of the announcement of financial results for the quarter ended December 31, 2025, and the trading window will reopen 48 hours after those results are declared, underscoring the company’s adherence to regulatory norms on handling unpublished price-sensitive information for investors and insiders.

Larsen & Toubro Seeks Shareholder Nod on New Independent Directors, Key Related-Party Deals via Postal Ballot

Larsen & Toubro Limited has initiated a postal ballot process to seek shareholder approval via e-voting on a set of key corporate actions, including the appointment of Amitabh Kant and B. Santhanam as independent directors for five-year terms effective October 29, 2025, and the re-appointment of Preetha Reddy as an independent director for a further five-year term from March 1, 2026. The ballot also seeks consent for entering into material related-party transactions with group and joint-venture entities L&T-MHI Power Boilers, L&T-MHI Power Turbine Generators, Larsen Toubro Arabia LLC, and L&T Modular Fabrication Yard LLC, with the voting window running from December 20, 2025 to January 18, 2026, underscoring the company’s emphasis on formal shareholder approval for board strengthening and significant intra-group business arrangements.

Larsen & Toubro Releases Q2/H1 FY26 Earnings Call Recording

Larsen & Toubro Limited has announced the release of the audio recording for its Q2 / H1 FY26 earnings call, which is now available on their website. This move is part of their compliance with SEBI regulations, ensuring transparency and accessibility for stakeholders, and reflects the company’s commitment to maintaining open communication with investors.