Long term Bet Larsen & Tubro Ltd.

>> Saturday, February 7, 2009

Scrip: - Larsen & Tubro (LNT)
BSE Code: - 500510
CMP: - 638.70
52 Week H/L: - 1937.00 - 611.00
Target for long term investors : - 100% return. (Time frame 15 - 18 months)

Summary: -
One of the badly beaten out scrip in the Indian markets is LNT.
Larsen & Toubro Limited operates in four segments. The Engineering & Construction segment comprise execution of engineering and construction projects to provide solutions in civil, mechanical, electrical and instrumentation engineering to core sectors/infrastructure industries, shipbuilding and supply of complex plant and equipment to core sectors. The Electrical & Electronics segment comprises manufacture and sale of low-voltage switchgear and control gear, custom-built switchboards, petroleum dispensing pumps and systems, electronic energy meters/protection (relays) systems, control and automation products and medical equipment. The Machinery & Industrial Products segment comprises manufacture and sale of industrial machinery & equipment, marketing of industrial valves, construction equipment and welding/industrial products. Others include ready-mix concrete, property development activity, and engineering services and embedded systems.

Stake in Satyam -
Recently LNT hiked its stake in Satyam from 4% to 12%.
Satyam has won few new coustomers. The new management of Satyam Computers can change the phase of Satyam Computers which will directly benefit LNT.

A long term bet: -
It is India’s largest Engineering and Construction giant.
L&T is the best managed company in India – Business Today survey.
Larsen and Toubro will benefit from huge infrastructure investments in India and Gulf regions.
Strong Order book.
L&T will be demerged into Power, IT, Ship building and Railway units along with engineering division. Investors will get very good returns after the demerger.

Employees-
LNT is reported to recrute 10,000 people in 3 yrs. This is because of its expansion.

Ratings -
Short term: - 5/10
Medium Term: - 7/10
Long term: - 10/10

Company has good financial. Good management also.
A safe bet for long term investors.

Happy Investing.
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