Credit Suisse downgrades L&T to underperform

Wed Nov 7, 2012 2:26pm IST

Labourers work inside a steel factory on the outskirts of Agartala, April 9, 2009. REUTERS/Jayanta Dey/Files

Labourers work inside a steel factory on the outskirts of Agartala, April 9, 2009.

Credit: Reuters/Jayanta Dey/Files

Related Topics

Stocks

   

Reuters Market Eye - Credit Suisse downgrades Larsen & Toubro (LART.NS) to 'underperform' from 'neutral', on concerns about deteriorating order flow mix and rising working capital cycle, which could impact margins and cash generation.

Over 40 percent of L&T's orders are from the Middle East and real estate segments which are "prone to execution delays" and would earn lower margin.

It would be difficult for L&T to sustain this growth momentum on its historic high inflows, Credit Suisse said in a note.

Credit Suisse believes L&T is expensive at 17.5 times FY14 parent EPS for 10 percent EPS CAGR (FY12-14E) and also does not expect any material improvement in return on equity.

At 11:25 p.m., shares were up 0.81 percent at 1,679 rupees.

FILED UNDER:

Economic Pulse

Reuters Showcase

Reaction to Budget

Reaction to Budget

India budget unlikely to impact credit rating - agencies  Full Article 

PMI Data

PMI Data

Factory activity growth slows to five-month low in Feb  Full Article 

Documents Leaked

Documents Leaked

Indian Oil suspends official for leaking information - sources  Full Article 

Ola Buys Rival

Ola Buys Rival

Ola buys rival TaxiForSure for $200 million  Full Article 

Coal Auction

Coal Auction

India examines coal mine bids amid reports of discrepancies  Full Article 

Battling Apple

Battling Apple

Samsung unveils sleek new Galaxy phones  Full Article 

China Economy

China Economy

China Feb HSBC PMI at seven-month high but more rate cuts seen on the cards  Full Article 

Global Economy

Global Economy

Stimulus swells as China eases, India spends   Full Article 

Reuters India Mobile

Reuters India Mobile

Get the latest news on the go. Visit Reuters India on your mobile device  Full Coverage