Larsen & Toubro (L&T) shares rose by 3 percent in early trading on Friday, leading the Nifty 50 index, following an upgrade from global brokerage firm Goldman Sachs. The brokerage moved the stock’s rating from neutral to buy and increased its 12-month target price to ₹5,000, up from ₹3,730.
Goldman Sachs attributed this revised outlook to L&T’s enhanced growth visibility and favorable risk-reward profile, which is supported by the company’s expanding capabilities and improving financial metrics. The brokerage noted L&T’s strong execution and operational efficiency as crucial factors that could unlock new opportunities for the company, paving the way for a potential re-rating.
Key elements driving projected earnings growth through FY26–28 include L&T’s robust order backlog, minimal working capital requirements, and effective capital allocation. The brokerage expects margins to further improve during the FY28–30 execution cycle, bolstered by growth in emerging sectors such as defense, green hydrogen, and nuclear power. According to Goldman Sachs, these sectors could account for 15 percent of order inflows by FY35, an increase from approximately 4 percent currently.
Goldman Sachs also expressed optimism regarding a domestic capital expenditure recovery and highlighted solid order visibility across various time frames—short, medium, and long-term. The firm anticipates that over the next five years, L&T will achieve a low double-digit revenue growth rate while realizing mid-teen growth in profit after tax.
The upbeat outlook from Goldman Sachs has positively influenced investor sentiment, prompting an increase in L&T shares. In early trading, the stock surged to ₹4,114 on the National Stock Exchange (NSE). By 11:55 AM, shares were trading at ₹4,076, compared to the previous close of ₹4,003.90.
Published on December 12, 2025.
