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L&T gains after bagging large IOCL deal

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Capital Market
Last Updated : Apr 08 2020 | 10:50 AM IST

Larsen & Toubro (L&T) advanced 2.33% to Rs 820.30 after the company said its wholly owned subsidiary, L&T Hydrocarbon Engineering (LTHE), secured a 'large' project from Indian Oil Corporation.

The engineering, procurement, construction and commissioning (EPCC) contract is for setting up a new 9 MMTPA atmospheric & vacuum distillation unit (AVU) and allied facilities (EPCC-1 package) for Indian Oil Corporation (IOCL)'s Barauni refinery capacity expansion project in Bihar. The capacity of Barauni refinery is being augmented from current installed capacity of 6.0 MMTPA to 9.0 MMTPA. The project was awarded through an international competitive bidding on lump sum turn key (LSTK) basis.

As per the L&T's classification, the valuation of the 'large' order stands between Rs 2,500 and 5,000 crore. The disclosure was made during trading hours today, 8 April 2020.

On Tuesday, 7 April 2020, the Smart World & Communication business of L&T Construction secured a 'large' order from the Indian Army to establish a Unified Network Management System (UNMS) to manage, support and operate the countrywide Armed Forces Network under the Network for Spectrum (NFS).

Meanwhile, on Friday, 3 April 2020, depository institutions CDSL and NSDL notified changes to the foreign investment limits in individual companies, raising the same to their respective sectoral caps. Higher foreign investment limits in Indian companies would lead to MSCI (Morgan Stanley Capital Investment) to raise Indian companies' weightage on its indices. L&T is one of the stocks which could see an increase in MSCI weightage.

Moreover, L&T on Monday, 6 April 2020 said its board will meet on 9 April 2020 to consider raising funds, including through issue of debt securities.

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On a consolidated basis, the company's net profit rose 15.21% to Rs 2,352.12 crore on a 5.87% rise in net sales to Rs 36,242.68 crore in Q3 December 2019 over Q3 December 2018.

Larsen & Toubro is an Indian multinational engaged in technology, engineering, construction, manufacturing and financial services.

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First Published: Apr 08 2020 | 10:06 AM IST

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