Goldman removes L&T from conviction buy list

Goldman Sachs removes Larsen & Toubro from its Asia Pacific conviction buy list following the stock's out performance over the last month. The stock has not seen any major reaction as it is trading flat at Rs 1,406 per share.

However, the investment bank retains its "buy" rating on the stock, citing robust order inflows year to date and continued market share gain.

[caption id="attachment_366751" align="alignleft" width="380"] Reuters[/caption]

Since being added to the conviction list on January 18, 2012, L&T shares have gained 13 percent vs. BSE Sensex rise of 6 percent and BSE Capital Goods index's 5 percent gains.

The market has been skeptical about the company's 15-20 percent growth guidance for its order book for financial year ending March 2013. Brokerage MF Global has projected an order growth of 6 percent.The company's management expects $16 billion order, driven mainly by a 35 percent growth in overseas orders (primarily middle east) and 9-10 percent growth in domestic orders.

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(With inputs from Reuters)