L&T gains 2% on 'significant' order wins for its water treatment business

Shares of Larsen & Toubro (L&T) rose 2 per cent to Rs 2,108 on the BSE in Monday’s intra-day trade after the company said it secured significant orders for its water and effluent treatment business. 

The company bagged an order from the Tumakuru Industrial Township Limited (TITL) under the Chennai Bengaluru Industrial Corridor (CBIC) along with repeat orders from the Tamil Nadu Water Supply and Drainage Board (TWAD Board), funded by the Asian Development Bank (ADB), L&T said in a press release.

The company did not disclose the exact value of the orders. The value of the project is between Rs 1,000 crore to Rs 2,500 crore, as per L&T.

The order from TITL is to construct, operate and maintain infrastructure works at the Tumakuru Node, Karnataka on an EPC basis.

This project is part of the Union government's flagship program-- ‘Development of Industrial Corridors‘ under the National Industrial Corridor Development and Implementation Trust (NICDIT), the apex body overseeing integrated development of all industrial corridors across the country.

Further, the orders from TWAD Board are to provide ’Underground Sewerage Scheme (UGSS)’ works at Coimbatore.

Meanwhile, recently L&T has outperformed the market by gaining 2 per cent in the past one month as compared to a 3 per cent decline in the S&P BSE Sensex.

In the past three months and six months, the stock price of the capital goods giant has appreciated 13 per cent and 40 per cent, respectively. However, despite today’s gains, L&T has shed down 4 per cent over the last week versus a 2 per cent decline in the benchmark index. The stock had hit a record high of Rs 2,211 on December 16.

Analysts at Prabhudas Lilladher believe that L&T is well-placed to benefit from overall diversified tender prospects with better order conversion in domestic market, significant traction in capex from oil exporting countries, mainly in hydrocarbon segment, and expected uptick in private capex.