L&T's stock are doing rather well. Know why

Shares of engineering giant L&T rose 1 percent after global brokerage CLSA maintained its `Buy' stance on the company and raised its price target to `2,275 from `2,100.

Larsen rose 19 rupees to 1,877.50 on the National Stock Exchange. The company has gained 17 percent over one year and enjoys a market capitalisation of 1.74 lakh crore rupees.

CLSA said in a note to clients L&T's business verticals in the defence sector are likely to show a steep trajectory in profitability. Orders from the nuclear, aerospace and defence industries are likely to multiply 4-5 times by the year to March 2018. As a consequence, earnings are likely to go back to growth mode from this financial year onwards, the note adds.

CLSA expects a pickup in L&T's earnings per share to 26 percent to support valuation.

(Image credit: Indiatimes)