Larsen and Toubro (L&T) has seen a rise in the pace of orders it has received, over the past six weeks.
The company has bagged about a dozen contracts in April 2020, compared with the half a dozen secured between January and March this year. It had missed its guidance for FY20 as it received fewer orders than expected in the last quarter.
“Order wins of ₹28,100 crore in six weeks amid weak investment sentiment was commendable,” wrote CLSA in a note to its clients.
The April orders include a major contact, three large contracts and seven significant contacts. A significant contract is one which is valued between ₹1,000 crore and ₹2,500 crore, a large contract is between ₹2,500 crore and ₹5,000 crore and a major contract is between ₹5,000 crore and ₹7,000 crore. L&T shares had gained 28.5% on the BSE over the past one month, recovering from the 52-week low of ₹661 seen on March 25 to ₹850.60 on April 24. The management said it was now focussing on resuming work at its sites to execute the ₹3.1 lakh-crore pending order book in a phased manner.
Research firm Morgan Stanley has maintained an overweight on the stock with the target raised to ₹1,117 from ₹941 per share, as it expects public capital expenditure to bounce back in FY22.
However, some analysts said that central spending on infrastructure projects may drop given the impact of the pandemic and orders from West Asia may dry up for L&T on falling oil prices.
