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L&T bags orders worth `1,340cr
Larsen & Toubro’s (L&T) building and factories division has bagged orders aggregating to
`1,340cr from various clients during 2QFY2012. Orders adding up to `975cr are for the
construction of a mixed use commercial development and construction of the main civil
works for an IT campus. Orders worth `203cr and `162cr are for construction of a
residential tower and add-on orders from various clients for ongoing contracts respectively.
With these order the outstanding order book stands at ~`1,37,512cr (3.1x FY2011
revenues) providing revenue visibility.
At the CMP of `1,558, the stock is trading at 19.5x FY2013E earnings and 3.3x FY2013E
P/BV, on a standalone basis. We have used the sum-of-the-parts (SOTP) methodology to
value the company to capture all its business initiatives and investments/stakes in the
different businesses. Ascribing separate values to its parent business on a P/E basis and
investments in subsidiaries on P/E, P/BV and mcap basis, our target price works out to
`1,946, which provides 24.9% upside from current levels. We recommend a Buy rating on
the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
L&T bags orders worth `1,340cr
Larsen & Toubro’s (L&T) building and factories division has bagged orders aggregating to
`1,340cr from various clients during 2QFY2012. Orders adding up to `975cr are for the
construction of a mixed use commercial development and construction of the main civil
works for an IT campus. Orders worth `203cr and `162cr are for construction of a
residential tower and add-on orders from various clients for ongoing contracts respectively.
With these order the outstanding order book stands at ~`1,37,512cr (3.1x FY2011
revenues) providing revenue visibility.
At the CMP of `1,558, the stock is trading at 19.5x FY2013E earnings and 3.3x FY2013E
P/BV, on a standalone basis. We have used the sum-of-the-parts (SOTP) methodology to
value the company to capture all its business initiatives and investments/stakes in the
different businesses. Ascribing separate values to its parent business on a P/E basis and
investments in subsidiaries on P/E, P/BV and mcap basis, our target price works out to
`1,946, which provides 24.9% upside from current levels. We recommend a Buy rating on
the stock.
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