Executor of the capex cycle at a cyclical multiple
| Peer | Status | P/E | ROE | Mkt cap | Why we do not hold it (approved text) | Links |
|---|---|---|---|---|---|---|
| Larsen & Toubro | Held | 32.10 | 14.72% | 5.32 L Cr | Executor of the capex cycle at a cyclical multiple | |
| Siemens | Not held | n/a | n/a | n/a | Siemens trades at ~93x P/E (screener, 7-Sep-2026) on Rs 24,846 cr revenue versus L&T at ~31x on Rs 2.86 lakh crore revenue; similar ROE (19.2% vs 15.9%) but three times the multiple. | Screener · Tijori |
| ABB India | Not held | n/a | n/a | n/a | ABB is at ~102x P/E with 22.4% ROE; superior returns but priced for perfection, and its Rs 13,203 cr revenue base gives no exposure to the Middle East/energy EPC cycle L&T is winning. | Screener · Tijori |
| BHEL | Not held | n/a | n/a | n/a | BHEL trades at ~60x P/E with 6.2% ROE and Rs 1,600 cr FY26 profit; L&T earns 12x the profit at half the multiple with far stronger execution and working-capital metrics. | Screener · Tijori |
Peer numbers are shown only where the peer is in the security master (fundamentals pulled); "n/a" otherwise — a peer is not added to the data pull without a research request. Reasons are quoted from the one-pager (8 Sep 2026).
We own no defence (HAL, BEL, BDL: 40–60x for government-monopsony order books), no railways (RVNL, IRFC, Titagarh) and no renewables (Suzlon, Inox Wind, Waaree) — great businesses for an extended period, but the valuations and investor faith are extreme. Among capital-goods bellwethers, ABB, Siemens and Cummins at 50–70x price a private-capex boom that machinery data (26% of GFCF) does not yet confirm. Bharat Forge is a good company at 40x with a defence premium; we prefer RK Forgings (Autos) for the same end-markets at a cyclical trough. Supreme Industries is owned only in AIF I; in the PMS Astral is the pipes expression.
All sectors we avoid or underweight →L&T (2.4%, Core): ₹7.8 lakh crore order book (+27% YoY), inflows led by West Asia and energy transition, working-capital discipline, and a multiple below the small-cap capex names it out-executes. Astral (1.0%, Core): the CPVC leader, 10x book but 50x FY28E against an 80x history, buying a volume recovery after a destocking year. Indo-MIM (0.8%, Core): 6.8% global MIM share, 25%+ margins, aerospace/medical/firearms customers, listed July 2026. Dilip Buildcon (0.6%, Cyclical): one of the largest road EPC players, deleveraged via HAM asset sales, 20x FY28E as margins normalise.
| Nuclear Projects Construction Segment Market Share | 51 % | as of Mar 18 |