L&T bags orders worth `875cr in Oman::Angel Broking,

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L&T bags orders worth `875cr in Oman
Larsen & Toubro (L&T) Oman, a subsidiary of L&T, has bagged two orders worth
`875cr in the urban infrastructure segment. Orders are from Muscat municipality
and Ministry of Transport and Communication, Sultanate of Oman, for
construction of two roads. The expected execution period for the two projects is 24
and 41 months. With these orders, the outstanding order book stands at
~`1,44,689cr (3.3x FY2011 revenue), which provides good revenue visibility.
At the CMP of `1,381, the stock is trading at 18.7x FY2013E earnings and 2.9x
FY2013E P/BV, on a standalone basis. We have used the SOTP methodology to
value the company to capture all its business initiatives and investments/stakes in
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 `1,714, which provides 24.2% upside from current levels.
We recommend a Buy rating on the stock.