India's L&T hits three-week low after profit dip, slower growth outlook (updated)

Larsen and Toubro

06/05/2026 06:25

Adds analyst comment in paragraph 6,8

May 6 (Reuters) - Shares of India's Larsen & Toubro LART.NS slid to a more than three-week low on Wednesday after the conglomerate posted a 3.1% drop in quarterly profit a day earlier and warned that the ongoing Middle East conflict would slow revenue growth this fiscal year.

Shares of L&T, seen as a barometer of India's infrastructure sector, fell as much as 3.8% to 3,900 rupees in early trade, after the company flagged on Tuesday that pressures from the Middle East conflict would build over the next two quarters.

The Middle East accounted for about 40% of L&T's $77.82 billion order backlog in the quarter ending March 31.

The stock has shed about 8.2% since the Iran war began on February 28, compared with a 4.2% drop in the broader Nifty 50 index .NSEI.

On Tuesday, the firm said it expects revenue to grow at a slightly slower pace of 10-12% for the current fiscal year.

Emkay Research cut its rating on the stock to "Add" from "Buy" and lowered the price target to 4,450 rupees from 4,800 rupees.

The brokerage said that despite strong order inflows and a robust backlog, L&T's results were impacted by weaker execution and margin pressures.

The firm said it aims to keep margins broadly stable at around the reported 8.3% for fiscal 2027 and expects an order book growth of 10-12%.

"Challenging geopolitical conditions may slow market share gains and new market expansion. While strong execution supports a long-term outlook, near-term growth and margin risks persist," analysts at HSBC Global Investment Research said.

($1 = 95.0912 Indian rupees)

(Reporting by Brijesh Patel in Bengaluru; Editing by Rashmi Aich)

((Brijesh.Patel1@thomsonreuters.com; Ph no. +91 9590227221;))