L&T Shares Fall as Orders Seen Disrupted by India Elections

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Larsen & Toubro Ltd. shares tumbled in early Mumbai trade after the engineering behemoth said orders may slow in the year ending March 2025 as India elects a new federal government in the coming weeks, pausing public infrastructure spends.

Orders are likely grow 10% in fiscal 2025, down from 20% in the previous year, L&T’s Chief Financial Officer Shankar Raman said in a media briefing. “We have to factor for disruption in domestic order flow as the new government settles down,” he said. “We could be looking at another 9-month year.”

Shares dropped as much as 5.7% to 3,290 rupees, the worst intraday fall since Jan. 31.

The CFO’s comments are crucial as analysts have been concerned about L&T’s growth outlook because the company makes a significant chunk of its revenue from government orders. Its order book stood at 4.76 trillion rupees ($57 billion) at the end of March 2024. Around 38% of the orders are from international markets compared to 28% a year ago.

The largest engineering and construction firm in the country reported a 10% growth in net income of 43.96 billion rupees for the January-to-March period on Wednesday, beating analyst estimates of 42.75 billion rupees. This was the highest quarterly profit since at least 2020.

The company also guided to margins of 8.25% for the year, which led analysts at Jefferies and Motilal Oswal to cut their earnings estimates.

What Bloomberg Intelligence Says:

“Fiscal 2025 Ebitda could miss consensus forecast by at least 5%, as the company is expecting margin for projects & manufacturing to hold steady even as unprofitable legacy projects are completed.”

— Denise Wong, infrastructure analyst

Click here to read the research.

The firm has been expanding its international presence to reduce its reliance on domestic and government orders. New international orders during the quarter, composed mainly of orders from the Middle East, which declined 30% to 252 billion rupees as clients in the region put some projects under review amid ongoing conflict.

However, weakness in Middle East orders is not expected to sustain, Raman said. Overall order momentum should resume in the second half of the year, he added.


  • Fourth-quarter revenue 670.8 billion rupees, up 15%, beats estimate of 658.69 billion rupees

  • 2025 fiscal order growth forecast 10%, estimate 11.3%

  • 2025 revenue growth forecast 15%, estimate 14.2%

  • 2025 Ebitda margin forecast 8.25%, estimate 11.9%

(Updates with shares and analyst commentary)

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