LT - Technical Analysis with Chart Patterns & Indicators
Back to ListTechnical Rating: 3.7
| Stock Code | LT | Market Cap | 4,95,900 Cr. | Current Price | 3,605 ₹ | High / Low | 4,440 ₹ |
| Stock P/E | 43.8 | Book Value | 494 ₹ | Dividend Yield | 0.94 % | ROCE | 18.5 % |
| ROE | 17.1 % | Face Value | 2.00 ₹ | DMA 50 | 3,963 ₹ | DMA 200 | 3,845 ₹ |
| Chg in FII Hold | 0.58 % | Chg in DII Hold | -0.35 % | PAT Qtr | 3,471 Cr. | PAT Prev Qtr | 1,212 Cr. |
| RSI | 36.1 | MACD | -149 | Volume | 52,87,567 | Avg Vol 1Wk | 72,33,660 |
| Low price | 2,965 ₹ | High price | 4,440 ₹ | PEG Ratio | 2.58 | Debt to equity | 0.27 |
| 52w Index | 43.4 % | Qtr Profit Var | 44.4 % | EPS | 45.3 ₹ | Industry PE | 15.2 |
📈 Chart & Trend: The stock is trading below both its 50 DMA (3,963 ₹) and 200 DMA (3,845 ₹), showing medium-term weakness. Current price (3,605 ₹) is closer to its 52-week low (2,965 ₹) than the high (4,440 ₹), reflecting bearish sentiment after a correction.
📊 Momentum Indicators: RSI at 36.1 signals oversold conditions, suggesting potential for a short-term bounce. MACD at -149 confirms bearish bias. Bollinger Bands show price hugging the lower band, consistent with oversold consolidation.
🔎 Volume Trends: Current volume (52.8 lakh) is lower than the 1-week average (72.3 lakh), showing reduced participation and lack of strong buying interest.
💡 Entry Zone: 3,550–3,600 ₹ (near support at 3,500–3,520 ₹, offering tactical entry)
💡 Exit Zone: 3,900–4,000 ₹ (resistance near 3,845–3,963 ₹, aligning with DMA levels)
📌 Trend Status: The stock is consolidating near oversold levels, with potential for a short-term reversal bounce but medium-term trend remains weak.
Positive
- Strong ROCE (18.5%) and ROE (17.1%) highlight efficient capital use.
- Low debt-to-equity (0.27) indicates a healthy balance sheet.
- Quarterly PAT growth (1,212 Cr → 3,471 Cr) shows strong earnings momentum.
- EPS of 45.3 ₹ reflects solid profitability.
- Dividend yield of 0.94% provides income support.
Limitation
- Stock trading below both 50 DMA and 200 DMA shows weak technical strength.
- High P/E (43.8) compared to industry P/E (15.2), making valuation expensive.
- PEG ratio (2.58) suggests growth is overpriced relative to earnings.
- DII holding decreased (-0.35%), showing reduced domestic institutional confidence.
Company Negative News
- Stock corrected from 4,440 ₹ to 3,605 ₹, eroding investor wealth.
- MACD negative and RSI oversold confirm weak momentum.
Company Positive News
- FII holding increased (+0.58%), showing foreign investor support.
- Quarterly profit growth (+44.4%) highlights strong operational performance.
Industry
- Industry P/E (15.2) is much lower than company P/E (43.8), suggesting sector peers trade at more reasonable valuations.
- 52-week industry index return of 43.4% shows strong sector momentum.
Conclusion
⚖️ Larsen & Toubro (LT) is consolidating near oversold levels, trading below key moving averages. Fundamentals like PAT growth, ROCE, and ROE are supportive, but valuation is stretched and momentum indicators remain weak. Tactical strategy: accumulate near 3,550–3,600 ₹ with strict stop-loss below 3,500 ₹, and book profits around 3,900–4,000 ₹. Sustained recovery requires crossing 3,845–3,963 ₹ resistance zones.
Would you like me to extend this into a peer benchmarking overlay against other infrastructure and capital goods companies? That would clarify whether LT’s valuation premium is justified compared to sector peers.