Larsen & Toubro- Remains In Top Quartile; Maintain BUY ::Emkay

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Larsen & Toubro

Remains In Top Quartile; Maintain BUY

BUY

CMP: Rs1,630                                        Target Price: Rs1,936

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n     Reports satisfactory performance in Q1FY12 - Net profit growth at 12% yoy meets expectations; despite 100 bps yoy drop in EBITDA margins

n     Secures orders worth Rs162 bn (up 4% qoq) – equivalent to 17% of FY12E target. Order book increases to Rs1,362 bn (up 26% yoy, 5% qoq) – 3X sales

n     Rise in employee, interest and depreciation expenditure is noteworthy - fine tune FY12E and FY13E earnings and revise downwards by 2.8% (Rs79.8/Share) and 2.5% (Rs98.0/Share)

n     Earnings growth estimates and growth guidance in top quartile of comparative peer growth, L&T remains amongst few formidable options, Retain BUY with TP Rs1936/share