Larsen & Toubro Poised for Order Boost and Diversification into New-Age Sectors, Brokerages Optimistic

Brokerages are highly optimistic about Larsen & Toubro's (L&T) future order inflows, particularly from domestic markets, anticipating growth in sectors like energy, infrastructure, and real estate. In the second quarter of fiscal year 2026, L&T secured group orders worth ₹115,784 crore, with 45% originating from domestic sources, predominantly in infrastructure. International orders were concentrated in hydrocarbon, renewables, and power transmission.

L&T is strategically focusing on expanding its order book by targeting approximately 10-15GW of thermal power projects over the next two to three years, alongside opportunities in nuclear and hydro power. Significant inflows are also expected from the buildings and factories segment, especially from real estate, and from transportation infrastructure, metals and mining, and defence sectors. The company is proceeding cautiously with water projects due to payment delays, which currently constitute 7% of its total order book.

Elara Securities noted a strong Q2 performance with Engineering and Construction (E&C) order inflows up 54% year-on-year, driven by substantial wins in hydrocarbon and infrastructure, domestically and in West Asia. The robust pipeline of ₹10.4 lakh crore, boosted by energy transition and infrastructure prospects, suggests continued strong inflow momentum.

Antique Stock Broking highlights L&T's position as a key beneficiary of government initiatives like Gati Shakti, aimed at reviving the Indian economy through infrastructure development.

Motilal Oswal Financial Services points out L&T's diversification into new-age sectors like electronics manufacturing, renewable energy, and semiconductors under its Lakshya 2031 plan. In renewables, L&T signed an MoU with Itochu Corporation for a green ammonia project and is executing a similar project in Saudi Arabia. In semiconductors, its subsidiary has acquired design assets and IP from Fujitsu General Electronics and is partnering with IISc Bengaluru for advanced research.

Impact This news indicates strong potential for growth and profitability for Larsen & Toubro, driven by robust order wins and strategic diversification into high-demand, future-oriented sectors. This can lead to positive investor sentiment and potentially boost the company's stock performance, signaling a positive outlook for the broader industrial and infrastructure segments in India. Rating: 8/10.

Difficult terms explained: EPC: Engineering, Procurement, and Construction. This refers to companies that manage entire projects from design and material sourcing to building. GW: Gigawatt. A unit of power, equal to one billion watts, typically used to measure the capacity of power generation plants. MoU: Memorandum of Understanding. A preliminary agreement between two or more parties establishing a framework for future cooperation. Gati Shakti: A government initiative aimed at integrated planning and development of infrastructure across various ministries to enhance connectivity and economic growth. IP: Intellectual Property. Refers to creations of the mind, such as inventions and designs, for which exclusive rights are granted. 2D innovation hub: A research center focused on developing next-generation materials and technologies, specifically in the realm of two-dimensional materials for advanced applications.