JP Morgan downgrades L&T to 'neutral' on valuations

Reuters Market Eye - J.P. Morgan downgrades Larsen & Toubro Ltd (L&T) to "neutral" from "overweight" and maintains its target price of 970 rupees, saying the current share price adequately discounts near-term positives.

The investment bank adds it remains wary of risks associated with deteriorating working capital, higher-than-expected margin drag on overseas orders and a rise in the proportion of slow-moving orders.

JP Morgan says valuations at 18 times one-year forward earnings are not cheap for the company.

L&T shares down 0.8 percent at 1322 IST.

(Reporting by Abhishek Vishnoi)