Larsen & Toubro Stock Faces 12% Weekly Decline Due to Iran War Impact Before Staging Recovery
The Indian stock market has seen significant volatility this week due to the escalating conflict between Iran and Israel. Larsen & Toubro (L&T) emerged as one of the most affected heavyweights. The company’s shares fell by approximately 12.5% from their 52-week high of ₹4,440 within just a few trading sessions. This sharp decline was triggered by fears regarding the company’s massive business exposure in the Middle East. Currently, the region accounts for roughly 37% of L&T’s total order book, which stands at a massive ₹7.33 lakh crore. Investors are worried that the war could lead to project cancellations or major execution delays.
Actually, the pressure on the stock intensified after reports of military strikes on Iranian targets over the weekend. This led to a 7% crash in a single day on March 4. To be honest, the market was reacting to the risk of 15,000 L&T workers currently stationed in the Gulf region. Analysts from Emkay Global noted that core earnings could be negatively impacted by 11% if the conflict prolongs. However, the narrative shifted quickly on Thursday, March 5. The stock made a swift rebound of nearly 5% to reach ₹4,072. This recovery was driven by value buying as the shares hit a key support level.
Broking firms like Motilal Oswal remain optimistic despite the near-term headwinds. They maintained a “Buy” rating with a revised target price of ₹4,400 per share. The firm believes that L&T’s core EPC business will eventually benefit from future infrastructure reconstruction in the region. Basically, the current correction is seen by many as a favorable entry point for long-term investors. The company also recently bagged major orders in its Power Transmission and Distribution vertical.
This situation highlights how global geopolitics can immediately impact Indian corporate giants. L&T management confirmed that all employees and assets on the ground are currently safe. They are monitoring the situation in real-time to manage logistical challenges. The stock remains a high-conviction pick for many experts. The next few weeks will be vital for the share price as the geopolitical landscape evolves.
