Rs 4,909 billion order book: LIC-backed multibagger civil construction company enters into a share purchase agreement with The Wave Development SPC

The stock is up 35 per cent from its 52-week low and gave multibagger returns of 120 per cent in the last 3 years.

On Wednesday, the shares of Larsen and Toubro Ltd plunged 0.19 per cent to Rs 3,544.35 per share from its previous closing of Rs 3,551.25 with an intraday high of Rs 3,578.45 and an intraday low of Rs 3,537.85. The stock’s 52-week high is Rs 3,948.60 and its 52-week low is Rs 2,623.95.

Larsen & Toubro Limited has announced the acquisition of an additional 15 per cent stake in its Oman-based joint venture, Larsen & Toubro (Oman) LLC (L&T Oman). This purchase from the existing partner, The Wave Development SPC, will increase LTIFZE's ownership in L&T Oman to 80 per cent. L&T Oman is a significant player in the Omani construction and infrastructure sector, with a turnover of OMR 53.68 million in 2023. The acquisition is seen as a strategic move to consolidate LTIFZE's position in the region and strengthen its foothold in the Omani market.

The acquisition of the additional stake in L&T Oman is being made for a cash consideration of OMR 1.2 million. The transaction is classified as a related party transaction due to the existing joint venture between LTIFZE and The Wave Development SPC. However, the company assures that the deal is conducted on an arm's length basis and in compliance with all applicable laws. No regulatory approvals are required for the acquisition, and the deal is expected to be finalized by August 31, 2024.

About the Company

Larsen & Toubro (L&T) is a massive Indian conglomerate with its fingers in many pies. Their core business is engineering, procurement and construction (EPC) solutions across various sectors like infrastructure, power, hydrocarbon (oil & gas) and defence. They also manufacture custom-designed machinery for these industries and even have a real estate arm. L&T is a major player in IT services through subsidiaries like L&T Infotech and Mindtree and provides financial services like rural and housing finance through L&T Finance Holdings. They even handle development projects involving infrastructure, toll management and power generation.

The company has a market cap of Rs 4.87 lakh crore and has been maintaining a healthy dividend payout of 34.6 per cent. Life Insurance Corporation of India (LIC) owns an 11.63 per cent stake in the company as of June 2024. The company has a robust order book valued at Rs 4,909 billion as of June 30, 2024. The stock is up 35 per cent from its 52-week low and gave multibagger returns of 120 per cent in the last 3 years. Investors must keep this Large-Cap stock. 

Disclaimer: The article is for informational purposes only and not investment advice.

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