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L&T signs `2,600cr CA with NHAI and bags orders worth `4,100cr
Larsen & Toubro (L&T) has signed the concession agreement (CA) with NHAI for four
laning of the 244km stretch of NH14 between Beawar and Pindwara in Rajasthan. The
project would be executed on DBFO (Design, Build, Finance and Operate) basis. The
estimated project cost is `2,600cr and is expected to be completed in 30 months.
Further, during 1QFY2012, L&T’s building and factories segment, part of its construction
business, has bagged orders aggregating to `4,100cr for airport expansion and
construction of hospital, commercial and residential buildings including factories. With
these orders, the company’s outstanding order book stands at ~`138,397cr (3.2x FY2011
revenue), which provides good revenue visibility.
At the CMP of `1,653, the stock is trading at 20.0x FY2013E earnings and 3.4x 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 `2,033, which
provides 23.0% upside from current levels. We recommend Buy on the stock.
India Equity Research Reports, IPO and Stock News
Visit http://indiaer.blogspot.com/ for complete details �� ��
L&T signs `2,600cr CA with NHAI and bags orders worth `4,100cr
Larsen & Toubro (L&T) has signed the concession agreement (CA) with NHAI for four
laning of the 244km stretch of NH14 between Beawar and Pindwara in Rajasthan. The
project would be executed on DBFO (Design, Build, Finance and Operate) basis. The
estimated project cost is `2,600cr and is expected to be completed in 30 months.
Further, during 1QFY2012, L&T’s building and factories segment, part of its construction
business, has bagged orders aggregating to `4,100cr for airport expansion and
construction of hospital, commercial and residential buildings including factories. With
these orders, the company’s outstanding order book stands at ~`138,397cr (3.2x FY2011
revenue), which provides good revenue visibility.
At the CMP of `1,653, the stock is trading at 20.0x FY2013E earnings and 3.4x 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 `2,033, which
provides 23.0% upside from current levels. We recommend Buy on the stock.
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