Larsen & Toubro Tops HDFC Securities’ Diwali 2025 Picks with Strong Order Book and Growth Visibility

October 17, 2025: HDFC Securities’ institutional research team has identified Larsen & Toubro Ltd (L&T) as one of its top Diwali picks. This is a perfect stock for investors looking for long-term growth as the company has strong order inflows, a very healthy financial position, and diversified presence in different sectors. The clientele includes infrastructure development, manufacturing, and technology services. The company provides infrastructure development services to government and private sectors.

Company Overview

L&T is a synonym of trust, engineering, and mega construction projects in the country. Besides India, the company has its presence in more than fifty countries. It has multiple business verticals starting with infrastructure, energy projects, hydrocarbon, defence, and financial services. It also has technology subsidiaries such as L&T Technology Services and LTIMindtree that contribute to its digital and engineering solutions portfolio.

Recent Stock Performance

On October 17, 2025, the shares of Larsen & Toubro Ltd were trading at around ₹3,770. The stock has remained resilient amid market volatility and has risen by approximately 4.14% in the past month. The performance was supported by strong quarterly results, improved margins, and a surge in fresh domestic and international order wins. The company’s market capitalisation currently exceeds ₹5 lakh crore, reaffirming its blue-chip status within the Indian equity markets.

Fundamentals and Valuation of the Stock

Over the past five years, L&T has delivered a revenue CAGR of 13–15% with a consistent EBITDA margin in the range of 11–12%. The company has been maintaining strong cash flows and improving return ratios through efficient capital allocation and working capital management.

One of the key strengths of the company is its strong order book which provides revenue visibility to the enterprise in the next few quarters. The company is dedicated to provide engineering excellence and disciplined execution of its projects.

Key Price Levels to Watch

While the LTP is ₹3,770, and the target price is ₹4,243, the recommended buy range by HDFC Securities is ₹3,760–₹3,818.

What Makes L&T a Preferred Stock

The company’s leadership in India’s infrastructure space makes it a structural growth story. L&T is a prime beneficiary of the government’s increased capital expenditure, particularly in roads, railways, and renewable energy. The company’s overseas operations and subsidiaries contribute meaningfully to diversification, reducing concentration risk.

Moreover, L&T’s consistent track record of timely project delivery, focus on technology-driven execution, and emphasis on sustainability position it among the top engineering companies globally. Its shareholder-friendly policies, including regular dividends and buybacks, further enhance its appeal to investors.

Risks to Consider

Even though the size, history, and fundamentals of the stock are pretty strong, the investors should be concerned about factors such as project delays, regulatory hurdles, and logistical issues. These issues might not be frequent but can have a negative impact on the stock price in the short to medium term.