The Nifty was under pressure for the third day in a row and moved sideways throughout the session, finishing with small gains at 19,681 levels. Auto stocks were also in the spotlight, thanks to good results from TVS, Bajaj Auto, and Tata motors. Profit booking occurred on the Nifty as a result of mixed corporate earnings and poor global indications.
L&T announced its Q1FY24 results today, and the stock is likely to open higher tomorrow, July 26, 2023. The stock is currently trading at ₹2,561.95 per share. L&T stock price as been showing a rising tendency so we believe that similar market conditions will support the stock.
Market sentiment can affect the investors sentiments, If the broader market is negative, the stock could also see a similar reaction. The company has also declared a ₹30 dividend and the ex-dividend date is 2nd aug 2023.
Here are some of the factors that could impact the stock price movement tomorrow:
Actual numbers: The stock is likely to react positively to the actual numbers announced by the company. The company reported a 46% YoY increase in consolidated profit after tax (PAT) to ₹2,493 crore in Q1FY24.
Valuation: The stock is Debt/Equity ratio of 0.3 on standalone basis and 1.51 on the consolidated basis. This is slightly above the historical average valuation of the stock. However, the company’s strong growth prospects and healthy dividend payout could support the valuation.
Fundamentals: Looking at the fundamentals the company has the highest market cap. in its segment of civil construction. The company also has an EPS of 28.37. The company has also delivered ROE in the range of 12 to 13 per cent in the last 3, 5, and 10 years period. Also the compounded sales growth of TTM of 17 per cent and profit growth of 22 per cent.
Technicals: The stock is trading trading above its 100 & 200 EMA indicating the stock is in the uptrend. The stocks first is witnessing first resistance at ₹2568.07 then at ₹2575.23. Whereas the immediate support is at ₹2553.37 and the second support is at ₹2545.83.
As of 2023 July 25, Tuesday data indicates that the asset price has been in an uptrend for the past 1 month, YTD, 1 year, 3 year with an increase of 8%, 23%, 46%, 183% respectively. This suggest that the stock is in the uptrend and we can say it will continue its rise.
Overall, the stock is likely to open higher tomorrow and could see a sharp rally in the early trade. However, the gains could be capped if the valuation becomes stretched.
In the long term, L&T is a well-established company with a strong track record of performance. The company is also well-positioned to benefit from the growth in the infrastructure sector in India. However, the stock is likely to remain volatile in the near term due to the ongoing uncertainties in the global markets.
Download The Mint News App to get Daily Market Updates.
Updated: 25 Jul 2023, 09:03 PM IST