Larsen and Toubro Shares (NSE:LT) Eye Breakout as ₹3,900 Resistance Nears

Larsen and Toubro shares (NSE:LT) have built a wave of bullish momentum, after a difficult first few months of the year, and now approach the ₹3,900 resistance level, a threshold that could signal a significant breakout. The stock has demonstrated considerable strength over the past six months, appreciating by approximately 19%, reflecting growing market confidence in the infrastructure giant.

The upward trajectory of L&T's stock is underpinned by a series of positive developments. In the last month alone, the company has secured seven new contracts with a combined value of around ₹40,000 crore. These contracts span various categories, including three large orders, two significant contracts, and one each major and ultra-mega contract.

Notably, the Hydrocarbon Onshore business secured an ultra-mega order for the construction of a Natural Gas Liquids plant in the Middle East, further bolstering the company's order book and future revenue prospects.

L&T's financial performance has also contributed significantly to the positive market sentiment. For the quarter ending March 31st, the company reported a consolidated net profit of ₹54.97 billion, exceeding analyst expectations of ₹49.98 billion. Revenue saw a substantial increase of nearly 11%, reaching ₹743.92 billion.

A significant aspect of this growth was the increasing contribution of international orders, which constituted 70% of total orders in the quarter, a notable increase from 35% in the previous year. This highlights L&T's expanding global footprint and its ability to secure large-scale projects in international markets.

Beyond its core business, L&T is strategically diversifying into high-growth sectors such as aerospace and semiconductors. The company is collaborating with Hindustan Aeronautics Limited to assemble India's first privately built Polar Satellite Launch Vehicle, aiming to capitalize on the burgeoning private space industry. This venture positions L&T to benefit from the increasing demand for space-related technologies and services.

In the semiconductor sector, L&T Semiconductor Technologies is planning to establish a $10 billion semiconductor fabrication plant in India by 2027. The realization of this ambitious project is contingent upon achieving $1 billion in annual revenue by the 2026-2027 fiscal year, indicating a clear target for the company's semiconductor ambitions.

The confluence of robust contract wins, strong financial performance, strategic diversification into high-growth sectors, and favorable technical indicators has collectively boosted market confidence in L&T. As the stock approaches the ₹3,900 resistance level, markets will be closely watching to see if it can sustain its upward momentum and break through this key barrier.