L&T Realty has entered into a binding agreement to jointly develop projects in South Mumbai, Western Suburbs and Thane worth Rs 8,000 crore, with a development potential of 4.4 million square feet.
In the intraday trade, the shares of Larsen & Toubro (L&T) rose 3% to Rs 1,734 after the firm disclosed that its real estate unit has signed three projects in the Mumbai Metropolitan Region for $1 billion (MMR). With today's rise, the engineering, designing, and building company's stock has increased by 18% over the past month. The S&P BSE Sensex, in contrast, increased by 6% over the same period. "L&T Realty, the real estate division of L&T, has entered into a legally binding agreement to jointly construct projects worth Rs 8,000 crore ($1 billion) with a development potential of 4.4 million square feet in South Mumbai, Western Suburbs, and Thane.
This is a part of the company's bigger strategy to increase its footprint in key metro areas by 5 million square feet annually for the next five years, according to a news statement from L & T. L&T Realty is currently present in Mumbai, Navi Mumbai, Bengaluru, Chennai, and, to a lesser extent, in NCR and Hyderabad. Its wide portfolio spans 70 million square feet across residential, commercial, and retail complexes. While everything was going on, L&T reported EPC orders for the railway, hydrocarbon, power T&D, water treatment, heavy engineering, buildings & factories segments totalling anywhere between Rs 7,000-15,000 crore during the April-June quarter (Q1FY23).
According to L&T's conservative guidance, the group's revenue and order inflows might increase by 12–15% in FY23, and its core business margin would be 9.5%. It has outlined a strategic plan for the years FY21 through FY26 (Lakshya 2026), where efforts, investments, and emphasis would assist domestic revenue and order inflows to grow at rates between 11 and 13 per cent CAGRs. "The pipeline of orders for T&D, the green energy corridor, data centres, railroads, transit, water, and infrastructure, among other things, continues to be strong. Project delays and deferrals, a reduced conversion rate, and "In a research on the capital goods and power sector, experts at ICICI Securities stated.
The brokerage expects L&T to have a respectable YoY increase in execution. "We believe that managing working capital and cash flow will be crucial. As a result, we forecast that adjusted standalone (including hydrocarbon) revenue will increase 57% to Rs 20,587 crore. As a result of improved execution, EBITDA is anticipated to increase by 54.5% to Rs 1,585 crore, with margins expected to remain flat at 7.7%. Adjusted PAT (ex-E&A) is anticipated to increase by 54.5% to Rs 1,159 crore, in part due to lower interest expense and lower tax "In a Q1 result preview note, the brokerage firm stated.