ET Intelligence Group: Despite the usual sluggishness in infrastructure orders from the central government before the general elections, Larsen and Toubro (LT) is expected to meet its annual order intake guidance considering the momentum of the past two months.

The optimism reflects in the stock’s performance, which has gained 11 per cent in a month. The country’s largest infrastructure company has guided for 10-12 per cent growth in order inflow for the current fiscal on the previous fiscal’s order intake of Rs 1.5 lakh crore.

Given the order inflow of Rs 1.2 lakh crore in the first nine months of FY19, the company needs to book another Rs 48,000 crore of orders in the March 2019 quarter to meet the guidance. According to JP Morgan, the declared order of the company is Rs 42,500 crore so far in the March quarter and including unreported and services revenues treated as inflows, the total order inflows for March quarter are likely to be Rs 56,800 crore, a growth of 13 per cent year-on-year.

If that happens, the company’s full-year order book will be worth Rs 1.8 lakh crore, implying a 16 per cent growth. Credit Suisse, in a note released on February 26, said order inflows this year may exceed the guidance by a fair margin and may be larger as the cycle builds up and some sedate segments start to contribute. LT has stopped disclosing the size of order received from the beginning of the March quarter.

Instead, it provides a classification such as significant order range of Rs 1,000-2,500 crore, large orders of Rs 2,500-5,000 crore, major orders of Rs 5,000-7,000 crore and mega orders above Rs 7,000 crore.

Brokerages covering the order inflows compute the order estimates by assuming the midpoint of the classification range.