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L&T shares fall 7% after Macquarie flags margin risk, but CLSA sees buying chanceMacquarie cited potential margin risks arising from evolving developments in the Gulf region. The brokerage said it had already identified geopolitics, commodity volatility and AI-led disruption as key risks for L&T.By Meghna Sen  March 4, 2026, 9:19:47 AM IST (Updated)2 Min ReadShares of infrastructure major Larsen & Toubro Ltd. (L&T) were trading as much as 7% lower on Wednesday, March 4. The stock has declined for the four straight session today.

Global brokerage Macquarie has maintained an 'Outperform' rating on the stock with a price target of ₹4,910.

The brokerage said that 37% of L&T's order book at the end of the third quarter of this fiscal is directly linked to the Middle East, while the region accounted for 33% of order inflows during the first nine months of FY26.

It added that the company's overall exposure to the Gulf has increased materially over the years, with 55% of the Gulf order book comprising fixed-price contracts.

Macquarie cited potential margin risks arising from evolving developments in the Gulf region. The brokerage said it had already identified geopolitics, commodity volatility and AI-led disruption as key risks for L&T.

While it is difficult to quantify the exact impact at this stage, it cautioned that some margin pressure appears likely if the conflict escalates.

CLSA has also retained an 'Outperform' rating on the stock, with a price target of ₹4,842.

The brokerage views the recent weakness, driven by cyclical concerns around the Middle East, as a buying opportunity for what it describes as an emerging global energy infrastructure player.

According to CLSA's analysis, a complete blockade of the Strait of Hormuz through March could reduce L&T's consolidated EPS by 1.8%.

However, it said that the stock has corrected sharply and is now among the cheapest large-cap industrial names in India.

CLSA added that L&T has navigated multiple crises in the past, shifting its focus across Indian government capex, Middle East projects, European opportunities and domestic private capex.

Despite a 70% year-on-year decline in new Middle East orders in Q3FY26, overall inflows rose 18% year-on-year. It also expects domestic execution to improve with the monsoon impact behind.

The company's $81 billion order backlog, up 30% year-on-year, remains robust in the current environment, particularly amid concerns of slowing activity in the Middle East, the brokerage said.

Shares of L&T ended 5.24% lower on Monday at ₹4,054 and are down 2% so far in 2026.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.First Published: Mar 4, 2026 9:12 AM ISTTagsLarsen and Toubroshare market today