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The stock market experienced a significant downturn, with the Sensex dropping by 500 points and the Nifty falling below 23,550. Shriram Finance, ONGC, and L&T emerged as the top losers in this decline. Investors are encouraged to stay updated on relevant market developments.
Gautam Chhaochharia, Head of Global Markets at UBS, emphasizes that local policy decisions will be the primary drivers of Indian markets, overshadowing global influences like Trump's policies. He expresses cautious optimism about economic growth and earnings recovery, while highlighting the need for policy support and potential rate cuts in the coming months. Chhaochharia notes that consumer sectors linked to rural recovery are better positioned for growth amidst current valuation concerns.
Larsen & Toubro is set to acquire a 21 percent stake in AI cloud provider E2E Networks for Rs 1,327 crore in an all-cash deal. This strategic partnership aims to enhance L&T's data center and AI capabilities by integrating E2E’s platforms, potentially accelerating offerings by 18-30 months.In other news, Reliance Jio's public listing is anticipated in the second or third quarter of 2025, with a valuation exceeding $6 billion.
E2E Networks shares surged nearly 5% to an all-time high of Rs 4,977.50 after Larsen & Toubro (L&T) announced plans to acquire a 21% stake worth over Rs 1,000 crore. The investment will occur through a preferential allotment for 15% and a secondary acquisition of 6% from the founder, expected to be completed by December 31.
L&T is set to expand its aerospace division to capitalize on the $44 billion private space market, following the Indian government's push to open the sector to private firms. The company aims to leverage its 50-year relationship with ISRO to manufacture launch vehicles, responding to the rising demand for commercial satellite launches. In FY2024, L&T's Precision Engineering and Systems unit reported a revenue increase of 41%, reflecting its strong position in the growing aerospace landscape.
Prabhudas Lilladher has issued a bullish recommendation for Larsen and Toubro, setting a target price of Rs 4,088. The company reported a 20.9% YoY revenue growth, despite a slight dip in EBITDA margin, and is poised to benefit from strong domestic and international order prospects, particularly in renewable energy and private capex investments. The stock is currently trading at a P/E of 29.9x for FY25 earnings.
Larsen & Toubro anticipates a stronger second half of the fiscal year, driven by increased capital expenditure and improved resource availability, following a slowdown in the first half due to lower order inflows linked to elections. The company maintains a 10% growth guidance for order inflows in FY25, supported by a favorable revenue mix and ongoing infrastructure projects, particularly in the Middle East. Despite a challenging environment, the medium-term outlook remains positive, although stock valuations are considered not inexpensive.
Larsen & Toubro (L&T) shares surged over 6% to Rs 3,631 following strong Q2 results that exceeded expectations, driven by robust order inflows and effective project execution. Brokerages, including CLSA and Nomura, have set target prices of Rs 4,151 and Rs 4,100 respectively, predicting a potential upside of 22%. Analysts noted L&T's third consecutive quarter of margin growth and a solid working capital position, despite challenges in government spending.
Analysts are optimistic about Larsen & Toubro, with Bernstein issuing an Outperform call and a target price of ₹3,891 per share, citing strong execution and a solid working capital position. Nomura also supports L&T with a Buy call and a target of ₹4,100, highlighting a significant order inflow growth guidance for FY25. In contrast, CLSA has issued a 'Hold' rating on Dabur India.
On October 31, stocks such as Larsen & Toubro, Biocon, Tata Power, DCM Shriram, Godavari Biorefineries, and Yatharth Hospital are in focus, alongside IRB Infrastructure Developers, Automotive Axles, Wipro, Adani Power, Allcargo Gati, and Torrent Pharmaceuticals. Additionally, Narayana Hrudayalaya, Tata Investment Corporation, BF Investment, BF Utilities, Last Mile Enterprises, Sonalis Consumer Products, and Sudarshan Pharma Industries are set to release their quarterly earnings today.
Larsen & Toubro Limited
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The information provided herein is generated by experimental artificial intelligence and is for informational purposes only.
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