L&T slips nearly 2% as Rs 5,000 crore orders fail to lift sentiment; stock down 6.4% YTD

Larsen & Toubro Ltd (L&T) shares declined 1.58 per cent to Rs 3,436.95 on April 1, despite the company announcing winning 'large' orders in its power transmission and distribution (PT&D) segment. Large orders, as per L&T's definition, are between Rs 2,500 crore and Rs 5,000 crore.

Key orders boost L&T's project pipeline

L&T won a 765kV Gas Insulated Substation (GIS) project in western India and an order for transmission line for power evacuation in western India. The company further won contracts in Saudi Arabia to build two 380kV overhead lines over a stretch of more than 130 kilometers on the outskirts of Riyadh. GIS project orders were also won in the UAE and Qatar, in addition to other project extensions in India and Oman. These developments signal robust demand for effective grid infrastructure and support L&T's execution strength in the power transmission business.

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Stock performance and technical indicators

Even with such order victories, L&T stock declined, having a lower position than its 5-day, 100-day, 150-day, and 200-day simple moving averages (SMAs). Nevertheless, it was greater than the 10-day, 20-day, 30-day, and 50-day SMAs. The 14-day relative strength index (RSI) for the stock stood at 59.81, reflecting a balanced momentum.

The stock of L&T has seen a decline of 5.92 per cent in 2025 till date. It currently has a price-to-equity (P/E) ratio of 47.20 and a price-to-book (P/B) ratio of 7.19. Its earnings per share (EPS) is at Rs 73.01 and the return on equity (RoE) stands at 15.22 per cent. Data available with Trendlyne indicates that L&T's one-year beta is 1.4, which indicates volatility is higher.

Factors affecting L&T’s stock movement

1. Market Sentiment: Broader market weakness, with the Sensex falling over 1,300 points, may have impacted investor confidence in L&T shares.

2. Technical Resistance: The stock’s inability to sustain higher levels due to selling pressure may have contributed to the decline.

3. High Valuation: L&T’s relatively high P/E ratio compared to industry peers suggests that investors might be cautious about valuation concerns.

Outlook for L&T stock

Although the decline, analysts expect L&T's long-term growth path considering its robust order book, diversified business portfolio, and execution capabilities. Short-term volatility in the general market and profit booking may, however, continue to dictate the movement of the stock.