L&T Q4 results: Profit growth likely to remain flat despite higher revenue; US-Iran conflict impact in focus

Engineering and construction giant Larsen and Toubro Limited (L&T) will announce its March quarter earnings on Tuesday, May 5. Experts believe that L&T could report mixed Q4FY26 results with double-digit growth in revenue, while net profit could see low single-digit growth.

The company’s consolidated revenue could rise by 12% to 14% to ₹83,600 to ₹84,600 crore driven by strong order book and healthy execution. L&T reported revenue of ₹74,392 crore in the same quarter of the last fiscal year and ₹71,450 crore in the previous quarter.

L&T could see 3% to 5% YoY growth in net profit in the range of ₹5,650 to ₹5,730 crore. The company reported a net profit of ₹5,497 crore in Q4FY25, while it stood at ₹3,215 crore in the previous quarter.

During the March quarter earnings, investors will monitor the impact of West Asia crisis on company’s order execution as L&T has significant exposure to the Middle East. In recent months L&T annouced stake sale in the Hyderabad Metro and Nabha Power, development on stake will also be tracked. Overall order book growth, new project pipeline and segment performance are also key monitorable parameters.

Ahead of the Q4 result announcement, L&T shares are trading 1.2% lower at ₹4,048 apeice. L&T shares have delivered flat return to investors so far this year.

Technical outlook

Larsen & Toubro is attempting to build momentum after reclaiming its key short-term averages, with the stock closing near ₹4,100 and sustaining above the 20-day EMA around ₹3,980 and 50-day EMA around ₹3,930. The immediate resistance is placed near ₹4,149, where the stock has faced immediate resistance in recent sessions. A decisive close above this level can open the door for further upside. On the downside, the ₹3,980 zone remains an important support, followed by the 50-day EMA.

Options outlook

For the 26 May expiry, the at-the-money (ATM) strike as of 5 May is 4,120 is priced at ₹245, implying an expected move of approximately ±6% by expiry.

Before we consider options strategies, let’s examine the historical price behaviour of Larsen & Toubro around its earnings over the past two years.

Options strategy for Larsen and Toubro

The implied move of ±6% opens up opportunities for both volatility and directional trades. Traders expecting a significant price swing can opt for a Long Straddle, buying both call and put options of the same strike and expiry. The strategy benefits if Larsen and Toubro move beyond the implied range of ±6%.

Meanwhile, those anticipating limited movement may consider a Short Straddle, which benefits if the stock stays within the ±6% band post-earnings.

For directional traders, a Bull Put Spread may be ideal for a breakout from the resistance zone, while a Bear Call Spread suits those expecting a breakdown below the immediate support zone.

Disclaimer:

Derivatives trading must be done only by traders who fully understand the risks associated with them and strictly apply risk mechanisms like stop losses. The information is only for educational purposes. We do not recommend any particular stock, securities or strategies for trading. The securities mentioned in this article are purely illustrative and not recommendations. Investors are advised to do their own research before investing.