L&T Q3 results spark optimism; analysts retain 'buy', raise target prices

Brokerages including Emkay Global and JM Financial retained their bullish calls on L&T, citing strong order wins, healthy margins, and robust growth prospects

Shares of civil construction major Larsen & Toubro (L&T) were in high demand on the bourses on Thursday, January 29, following the announcement of its financial results for the third quarter of FY26 (Q3FY26). The results announcement further prompted brokerages to reiterate their 'Buy' ratings on the stock.   Analysts at Emkay Global retained their bullish call, highlighting L&T’s strong order wins and healthy margins, with confidence in FY26 revenue growth, while those at JM Financial emphasised robust order inflows and international opportunities, supporting its bullish stance with expectations of strong medium-term EPS growth.  

Amid this, L&T share price rose 3.72 per cent to hit an intra-day high of ₹3,935.1 per share on the BSE during early trade on Thursday.

 

L&T Q3 results highlights

The company reported a recurring profit after tax (PAT) of ₹4,406 crore for Q3FY26, registering a year-on-year (Y-o-Y) growth of 31 per cent. The total consolidated PAT for the quarter stood at ₹3,215 crore, which includes a one-time material provision of ₹1,191 crore (net of tax and NCI) towards employee benefits arising from the implementation of the new labour codes. This provision has been classified under exceptional items, the company said in a release.

 

L&T reported consolidated revenues of ₹71,450 crore for the quarter, reflecting a Y-o-Y growth of 10 per cent, driven by steady execution progress across various businesses within the Projects & Manufacturing (P&M) portfolio.

 

The company further announced that it secured orders worth ₹135,581 crore during the quarter ended December 31, 2025, marking a Y-o-Y growth of 17 per cent. The group’s consolidated order book as of December 31, 2025, stood at ₹733,161 crore, reflecting a 30 per cent growth over December 2024.

Meanwhile, here’s what brokerages said on L&T post Q3 results

Emkay Global — Retains Buy | Target Price ₹4,800

Brokerage firm Emkay Global has retained its Buy rating on L&T, noting that the company surprised positively with a robust order-winning streak.  Ashwani Sharma, senior research analyst at Emkay Global, raised the SoTP-based target price to ₹4,800 from ₹4,400, valuing the core business at 27x P/E (unchanged), while reiterating the bullish call. He further highlighted that the company’s core inflows grew 18 per cent and 34 per cent Y-o-Y in Q3 and 9MFY26, respectively, taking the total order book to ₹7,33,000 crore (3.6x TTM). Key sectors driving strong inflows included infrastructure, energy, and real estate.   The Q3FY26 operating performance, Sharma said, was broadly in line with estimates. He further pointed out that despite strong order inflows in 9MFY26, management pointed to a robust prospect pipeline of ₹5,90,000 crore for Q4FY26, providing strong visibility for future order inflows. 

“With 34 per cent growth in 9MFY26 order inflows and a ₹5,90,000 crore prospect pipeline for Q4FY26, we expect FY26 P&M order inflows to be around ₹3,80,000 crore. On the execution front, management is confident of achieving 15 per cent revenue growth and P&M Ebitda margins of 8.3–8.5 per cent in FY26. We raise EPS by around 4 per cent on average over FY26–28E, led by strong order visibility. We roll forward to Dec-27E and reiterate Buy on the stock, while raising our SoTP-based target price to ₹4,800 from ₹4,400,” said the brokerage in its research note.

JM Financial — Retains Buy | Target Price ₹4,655

Brokerage firm JM Financial also reaffirmed its Buy rating on L&T with a target price of ₹4,655, implying an effective core P/E of 22x on FY28 EPS.

 

Analysts Priyankar Biswas, Neelotpal Sahu, and Vaibhav Shah highlighted strong delivery on order inflows, which grew 17 per cent Y-o-Y, significantly exceeding estimates. Core (ex-services) sales growth was modest and missed estimates; however, a surge in high-margin realty sales (included in the Others segment) offset margin weakness arising from legacy projects in the energy segment.

 

The analysts estimate FY26E order inflows growth of 24 per cent (versus guidance of over 10 per cent), factoring in Q3 strength and a robust international outlook. They expect order inflow momentum to sustain into FY27, with an estimated growth of 11 per cent.

 

“We value L&T on a sum-of-the-parts basis, with valuation multiples benchmarked to segment peers, leading to an effective EV/Ebitda of around 19x for FY28. We add the market capitalisation of listed subsidiaries in IT&TS and LTFH, with a 25 per cent holding company discount. This leads to our target price of ₹4,655, implying an effective core P/E of 22x on FY28 EPS,” the analysts said in a research note.

 

Near-term catalysts, according to JM Financial, include the upcoming five-year roadmap (Project Lakshya), where the brokerage expects order inflow guidance to remain robust.  ================================= 

(Disclaimer: The views and investment tips expressed by the brokerages in this article are their own and not those of the website or its management. Business Standard advises users to check with certified experts before taking any investment decisions.)