Larsen & Toubro delivered exceptional Q2FY27 results that significantly exceeded market expectations. The company reported consolidated net profit of ₹5,202 crore, representing a 33% year-on-year increase from ₹3,926 crore in the corresponding quarter of the previous fiscal. According to The Times of India, this performance exceeded estimates by approximately 17.4%, with the company's consolidated revenue rising 16% year-on-year to ₹78,750 crore, surpassing the estimated ₹72,752 crore. The revenue growth was driven by accelerated progress across businesses in the Projects, Products and Manufacturing portfolio, with international revenue accounting for 58% of total revenue at ₹45,870 crore. The company's EBITDA margin improved to 10% from 8.7% year-on-year, with EBITDA rising marginally by around 0.6% YoY to ₹6,845 crore in Q2FY27, compared with ₹6,806 crore in the corresponding quarter last year, due to a 38% drop in finance costs and 5% fall in depreciation. As per Reuters, the company achieved this performance despite ongoing regional war conditions in the Middle East.
L&T secured orders worth ₹1,47,665 crore during the September quarter, registering a 28% year-on-year increase. The company received several high-value orders across its Hydrocarbon, CarbonLite Solutions, Public Spaces and Airports, and Power Transmission and Distribution businesses. International orders amounted to ₹92,375 crore, accounting for 63% of the total order inflow. The company's consolidated order book stood at ₹8,53,514 crore as of September 30, 2026, marking a 15% increase over March 2026, with international orders accounting for 54% of the total order book. For the first half of FY27, L&T secured orders worth ₹2,55,678 crore, registering a 22% year-on-year increase with international orders contributing 60% to the total order inflow during the first half. According to Reuters, the company's order inflows rose 28% to ₹1.48 lakh crore in the July-September 2026 quarter, demonstrating continued strong demand across its business segments. As per The Economic Times, SN Subrahmanyan, chairman and managing director, noted that "The highest-ever order book at ₹8.5 lakh crore provides multi-year revenue visibility."
Market responded positively to L&T's exceptional Q2 performance, with shares surging over 6% following the results announcement. The stock opened at ₹3,820 per share on NSE today, as compared to previous close of ₹3,665.10 on Tuesday and touched an intraday low of ₹3,770 on 28 October. The stock emerged as one of the top gainers in Sensex and Nifty 50 today, reflecting strong investor confidence in the company's robust financial performance. A combined 1.4 million shares changed hands on the NSE and BSE, demonstrating robust trading activity. The strong market reaction reflects investor confidence in the company's robust financial performance and future growth prospects, with the record order book of ₹8.5 lakh crore providing multi-year revenue visibility. The positive market response indicates investor optimism about L&T's execution capabilities and growth trajectory in the coming quarters.
The biggest surprise in L&T's Q2 performance was the engineering and construction execution, which increased 22% from the previous year, despite West Asia disruptions. As per CLSA, engineering and construction execution was led by execution in the West Asia region, up 26% from last year, followed by India which rose 16%. The investment banking firm noted that the West Asia orders rebounded as if the war had ended. The company's $90 billion backlog grew 28% from the year-ago period and appears solid in the current environment. For the financial year 2027, L&T has retained its guidance of a 10% - 12% rise in new orders and execution with flat margins, despite the delay in the Strait of Hormuz opening. According to CLSA, L&T has also started the execution of its FY31 plan, touching all the right chords of wealth creation, from building an AI business by winning India's biggest Nvidia AI factory order to expanding into electronic manufacturing, green tech and chemistry.
Global investment banking firms have issued mixed reviews on L&T following its Q2 results. CLSA maintains an "outperform" rating with a target price of ₹4,842, indicating an upside potential of 32.1% from its previous closing price. The firm noted that L&T's second quarter results beat three of four guidance items, including new orders, execution and working capital, while its margins missed. Jefferies has a "Buy" rating but cut the target price to ₹4,700, citing weaker-than-expected margins and factoring in lower estimates. According to CNBC TV18, of the 31 analysts who have coverage on L&T, 26 have a "buy" rating, four have a "hold" rating and one has a "sell" recommendation. L&T shares ended the previous session 0.4% lower at ₹3,665.1 and have fallen 2.7% in the past month, 9.2% in the last six months and is down 11.5% this year. However, the company's strong operational performance and FY31 expansion plans continue to attract positive analyst sentiment despite margin pressures from geopolitical conflicts. ICICI Securities has now upgraded L&T to BUY with a revised target price of ₹4,450 from ₹4,040, citing the company's strong order inflows and healthy order pipeline of ₹10 trillion. Emkay Global Financial has now joined the positive sentiment, recommending a buy rating with a target price of ₹4,450 based on 1HFY29 estimates, citing the company's strong order backlog and long-term prospects driven by government infrastructure development and clean energy adoption. Motilal Oswal has now joined the bullish sentiment, recommending a buy rating with a target price of ₹4,400, maintaining their SoTP-based target price based on 25x Dec'28E earnings for core business and a 25% holding company discount to subsidiaries.
