L&T shareholders may get a special dividend, CLSA says; sees stock at ₹4,842
Published on 17/02/2026 08:42 AM
L&T shareholders may get a special dividend, CLSA says; sees stock at ₹4,842The focus is on L&T's agreement to sell its Nabha Power subsidiary to Torrent Power. CLSA expects the transaction to unlock around ₹26 per share in value and sees the potential for a special dividend.By Meghna Sen February 17, 2026, 8:42:15 AM IST (Published)2 Min ReadShares of engineering and infrastructure conglomerate Larsen & Toubro Ltd. (L&T) will be in focus on Tuesday, February 17.
Global brokerage CLSA has reiterated its 'Outperform' rating on the stock, with a price target of ₹4,842 per share.
The focus is on L&T's agreement to sell its Nabha Power subsidiary to Torrent Power. CLSA expects the transaction to unlock around ₹26 per share in value and sees the potential for a special dividend.
The brokerage said L&T's decision to exit Nabha Power, a relatively low return-on-equity concession, reinforces its stated objective of achieving an 18% ROE by FY26, a target first outlined in FY21 when ROE stood at 9.8%.
For FY25, ROE has already improved to 16%, indicating progress on that roadmap.
According to CLSA, the Nabha Power divestment should further enhance ROE, particularly if surplus cash is returned to shareholders.
The equity value of the deal is ₹3,660 crore, compared with a sum-of-the-parts valuation of ₹3,800 crore.
The brokerage said that some profit booking could reflect in the profit and loss account, as L&T had earlier marked down this investment.
With the exit from Nabha Power, L&T is expected to return surplus capital to shareholders through a special dividend as it works towards meeting its 18% ROE goal in FY26.
Of the 34 analysts covering L&T, 28 have a 'Buy' rating, four recommend 'Hold', and two have a 'Sell'.
Shares of Larsen & Toubro ended 0.63% higher at ₹4,200 on Monday and have gained over 30% in the past 12 months.Continue ReadingNote To ReadersDisclaimer: The views and investment tips expressed by investment experts on CNBCTV18.com are their own and not that of the website or its management. CNBCTV18.com advises users to check with certified experts before taking any investment decisions.TagsLarsen and ToubroLarsen Toubroshare market today