Shares of Larsen & Toubro (L&T) rose 1% in intraday trade on Friday and hit a record high of Rs 2,079.60 on the BSE on a strong order outlook. Shares of the engineering and construction company have surpassed the previous high of Rs 2,078.20 touched on January 18, 2022. In contrast, the S&P BSE Sensex was down 0.06% at 62,238 at 9:30 am.

L&T gained 3% in the past two sessions after securing an order worth Rs 1,000-2,500 crore from Greenko Group, one of the world’s leading renewable energy companies, for use in Madhya Pradesh.

The project is designed to meet the pumped storage capacity of 10,080 MWh. It envisages the construction of an upper reservoir near the block village of Khemla (about 75 km from Neemuch in Madhya Pradesh), while the existing Gandhisagar reservoir will be the lower reservoir. The civil and hydro-mechanical works for the project will be executed within a strict 30-month deadline through a consortium led by L&T, the company said in a regulatory filing.

In the first half (April-September) of the current fiscal year 2022-23 (H1FY23), L&T announced an order inflow of around Rs 93,719 crore. Management is confident of achieving its full-year guidance of around Rs 2.22 trillion for FY23. Order flows include industries including rail, hydrocarbons, power transmission and distribution, water treatment, heavy engineering, construction and factories.

Elsewhere, L&T is on track to maintain its FY23 revenue guidance of 15%, with a core EBITDA margin of around 9.5%, ICICI Securities said in a note.

Management has also retained its order inflow growth guidance of 12-15% as it expects better conversion of the Rs 6.3 trillion order book outlook in H2FY23. Analysts at Anand Rathi Share and Stock Brokers expect double-digit growth to continue with a focus on cash flow generation and execution and reducing exposure to non-core assets to boost returns.

Strong domestic growth momentum is supported by private and public capital spending. Private capex is gaining traction, with orders accounting for 29% of domestic inflows in Q2FY23 (22% last year). In its second-quarter results update, the broker said inflow momentum appears to continue with a strong Rs 6.3 trillion outlook pipeline and better conversion rates envisaged.

Analysts at Prabhudas Lilladher believe that L&T is well-positioned to benefit from an overall diversified tender outlook, better order conversion in the domestic market, a significant increase in capex by oil exporters mainly in the hydrocarbons sector, and an expected increase in private capex. benefit from the increase. The broker expects both L&T’s revenue and PAT to grow at a CAGR of 10.2%, considering healthy order books, tender outlook, diversification into new businesses (hydrogen, green EPC), improving Hyderabad Metro’s operational performance and continued execution momentum, and 18.2% from FY22 to FY25.