Larsen & Toubro Limited (LT) AI Stock Analysis

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Larsen & Toubro Limited

(LT)

Rating:70Neutral

Price Target:

₹4,026.00

▲(11.84% Upside)

Larsen & Toubro Limited's overall score is driven by its solid financial performance, though challenged by technical indicators showing mixed signals and a high P/E ratio suggesting potential overvaluation. The lack of earnings call and corporate event data did not influence the score.

Larsen & Toubro Limited (LT) vs. iShares MSCI India ETF (INDA)

Market Cap

₹4.95T

Dividend Yield0.94%

Average Volume (3M)108.66K

Price to Earnings (P/E)26.8

Beta (1Y)1.19

Revenue Growth15.74%

EPS Growth18.90%

CountryIN

Employees54,303

SectorIndustrials

Sector Strength79

IndustryEngineering & Construction

Share Statistics

EPS (TTM)26.29

Shares Outstanding1,375,511,800

10 Day Avg. Volume104,685

30 Day Avg. Volume108,655

Financial Highlights & Ratios

PEG RatioN/A

Price to Book (P/B)N/A

Price to Sales (P/S)N/A

P/FCF RatioN/A

Enterprise Value/Market CapN/A

Enterprise Value/RevenueN/A

Enterprise Value/Gross ProfitN/A

Enterprise Value/EbitdaN/A

Forecast

1Y Price Target

₹4,055.33

Price Target Upside12.65% Upside

Rating ConsensusStrong Buy

Number of Analyst Covering9

Larsen & Toubro Limited Business Overview & Revenue Model

Company DescriptionLarsen & Toubro Limited (LT) is a leading Indian multinational conglomerate with a diverse portfolio that spans engineering, construction, manufacturing, technology, and financial services. The company operates in various sectors including infrastructure, power, heavy engineering, defense, and information technology, among others. LT is renowned for its expertise in executing large-scale projects, delivering integrated solutions, and its commitment to sustainability and innovation.

How the Company Makes MoneyLarsen & Toubro makes money through a variety of revenue streams across its diverse business segments. The core revenue comes from its engineering and construction division, which manages large infrastructure projects such as roads, bridges, metro systems, and airports. The heavy engineering division contributes through the manufacturing of critical equipment for sectors like oil and gas, defense, and aerospace. LT's power and electrical business generates income by providing equipment and solutions for power generation and distribution. Additionally, the company earns revenue through its IT and technology services, offered under its subsidiary, L&T Infotech, which caters to clients globally. Financial services, including infrastructure finance and insurance, also form a significant part of its earnings. Strategic partnerships with governments, international corporations, and joint ventures further bolster its revenue generation capabilities.

Larsen & Toubro Limited Earnings Call Summary

Earnings Call Date:Jul 29, 2025

(Q3-2025)

% Change Since: |

Next Earnings Date:Oct 29, 2025

Earnings Call Sentiment Neutral

The earnings call highlighted significant achievements in order inflows and revenue growth, as well as improvements in working capital management. However, these positives were offset by declines in EBITDA margins and challenges within the Energy segment. Additionally, there was a noted decrease in the order prospects pipeline.

Q3-2025 Updates

Positive Updates

Record Order Inflow

The company reported the highest ever order inflow in its history during the quarter at INR 1.16 trillion, a growth of 53% year-on-year, driven by strong momentum in Infrastructure, Hydrocarbon, CarbonLite Solutions, and Precision Engineering & Systems businesses.

Strong Revenue Growth

Group revenues for the quarter registered a growth of 17% year-on-year, aided by strong execution momentum from several businesses within the Projects & Manufacturing portfolio.

Improved Working Capital Management

Net working capital to revenue improved to 12.7% as of December 31, 2024, an improvement of almost 390 basis points year-on-year.

LTIMindtree and LTTS Achievements

LTIMindtree recorded its highest ever deal wins in Q3 FY 2025 at USD 1.68 billion, and LTTS witnessed its highest ever large deal bookings during the quarter.

Negative Updates

Decline in EBITDA Margin

The group's EBITDA margin for Q3 FY 2025 declined to 9.7% from 10.4% in the previous year, mainly due to a revenue mix favoring the Projects & Manufacturing segment and lower operating margin in the ITTS segment.

Challenges in the Energy Segment

The Energy segment margin in Q3 FY 2025 was at 8.3%, down from 9.7% in Q3 FY 2024, due to various stages of project execution.

Order Prospects Pipeline Decrease

The order prospects pipeline for the remaining three months was INR 5.51 trillion, a decrease of 12% compared to December 2023, primarily due to a fall in the Hydrocarbon and CarbonLite prospects.

Company Guidance

In the Larsen & Toubro Limited Q3 FY 2025 earnings call, the company issued guidance indicating a positive outlook for the fiscal year. The order inflows for the nine months of FY 2025 saw a 16% year-on-year increase, positioning the company to surpass its initial 10% growth guidance for order inflows. Additionally, the revenue growth guidance of 15% for FY 2025 is expected to have potential upsides, given the strong order book. The EBITDA margin for the Projects & Manufacturing businesses is guided to remain at 8.2% for the full year. The company's net working capital to revenue ratio is expected to stay around 12.7%, which was reported as of December 2024. L&T also highlighted robust order prospects for the near term, which are expected to maintain growth momentum and enhance shareholder value sustainably.

Larsen & Toubro Limited Financial Statement Overview

Summary

Larsen & Toubro Limited shows solid financial health with robust revenue and profitability growth. The balance sheet is stable, though further leverage reduction could enhance financial stability. Cash flow performance indicates areas for improvement in cash generation.

Income Statement

Very Positive

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

Positive

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

Positive

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	2.56T	2.55T	2.19T	1.83T	1.56T	1.39T
Gross Profit	463.51B	399.89B	730.87B	650.46B	559.34B	477.76B
EBITDA	310.34B	379.54B	339.78B	303.00B	269.03B	271.56B
Net Income	150.37B	150.37B	130.59B	104.71B	86.69B	115.83B
Balance Sheet
Total Assets	3.80T	3.80T	3.40T	3.30T	3.20T	3.11T
Cash, Cash Equivalents and Short-Term Investments	717.46B	717.46B	486.32B	580.93B	460.25B	450.01B
Total Debt	1.32T	1.32T	1.16T	1.21T	1.26T	1.35T
Total Liabilities	2.64T	2.64T	2.37T	2.27T	2.25T	2.23T
Stockholders Equity	976.56B	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	228.44B
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 Price3599.85

Price Trends

50DMA

3585.18

Positive

100DMA

3514.07

Positive

200DMA

3491.46

Positive

Market Momentum

MACD

2.31

Positive

RSI

50.54

Neutral

STOCH

21.52

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 3599.85 is below the 20-day moving average (MA) of 3622.79, above the 50-day MA of 3585.18, and above the 200-day MA of 3491.46, indicating a neutral trend. The MACD of 2.31 indicates Positive momentum. The RSI at 50.54 is Neutral, neither overbought nor oversold. The STOCH value of 21.52 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

Overall Rating

UnderperformOutperform

Sector (64)

Financial Indicators

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CGPOWER	72 Outperform	₹1.09T	105.84		0.19%	25.71%	-31.59%
HAL	71 Outperform	₹2.90T	34.88		0.92%	2.07%	0.81%
LT	70 Neutral	₹4.95T	26.78		0.94%	15.74%	18.90%
SIEMENS	66 Neutral	₹1.09T	44.53		0.39%	-13.58%	-0.28%
Sector *	64 Neutral	$10.74B	15.86	8.15%	2.00%	2.70%	-15.17%
BEL	62 Neutral	₹2.70T	49.07		0.65%	14.23%	29.82%
MAZDOCK	61 Neutral	₹1.05T	48.45		0.79%	21.24%	-6.43%

* Industrials Sector Average

Performance Comparison

IN:LT

Larsen & Toubro Limited

3,599.85

-47.32

-1.30%

IN:BEL

Bharat Electronics Limited

369.25

74.67

25.35%

IN:CGPOWER

CG Power & Industrial Solutions Ltd

694.15

11.46

1.68%

IN:HAL

Hindustan Aeronautics Limited

4,333.85

-302.94

-6.53%

IN:MAZDOCK

Mazagon Dock Shipbuilders Ltd.

2,605.95

526.41

25.31%

IN:SIEMENS

Siemens Limited

3,063.30

-460.63

-13.07%

Larsen & Toubro Limited Corporate Events

Larsen & Toubro Ensures Regulatory Compliance with SEBI Regulations

Jul 4, 2025

Larsen & Toubro Limited has announced that it has complied with the SEBI (Depositories and Participants) Regulations, 2018, by furnishing details of securities dematerialized and rematerialized during the quarter ending June 30, 2025, to all stock exchanges where its shares are listed. This compliance ensures transparency and adherence to regulatory requirements, reinforcing the company’s commitment to maintaining robust governance practices.

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.Date of analysis: Jul 31, 2025