Larsen and Toubro share price rallied over 3 per cent on Tuesday after the engineering firm reported a 4.72 per cent rise in consolidated net profit to Rs 3,167.47 crore in the March quarter on the back of improvement in project execution. The company had clocked a net profit of Rs 3,024.61 crore in the same quarter last year.

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Reacting to its earnings, the Larsen and Toubro stock added 3.36 per cent on the BSE and was the top Sensex gainer. 

"Larsen and Toubro’s in-line Q4FY18 results vindicates our ‘BUY’ call on the bellwether with our target price of Rs 2,050 offering 50 per cent upside (peak cycle multiples) from current levels," said brokerage Edelweiss Securities in a results review report.

"Execution pick-up in infra jobs in the past 2-3 quarters makes a case for capex recovery, especially on PSU side. Recovery in private sector we believe provides strong growth visibility over next 2-3 years complementing L&T’s RoE/cash flow approach. We see Rs 11,000 crore free cash potential apart from Rs 40 lakh crore infra opportunity," it added.

Global brokerage CLSA also maintained ‘Buy’ with a price target of Rs 1,730. "Q4 results beat guidance on inflow and margin. Hydrocarbon business - the emerging star and fast-growing business. L&T has a credible strategy to improve both growth and its return on equity. L&T is a good proxy for domestic capex," the brokerage said in a report. 

For financial year 2017-18, Larsen and Toubro's net profit rose by 22 per cent to Rs 7,369.86 crore, from Rs 6,041.23 in the previous year. Its total revenues grew by 9.5 per cent to Rs 1,19,862.10 crore, from Rs 1,10,011 crore.

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"For the current fiscal year, we think the order inflow should be 10-12 per cent higher than FY18 and the revenues given the execution challenges should be between 12-15 per cent in terms of growth," L&T's group chief financial officer R Shankar Raman said.

"It has been a satisfactory year mainly in the context of the environment that we have been in where the company is caught in the cross currents between the headwinds and the tailwinds blowing at the same time," he added.

L&T won fresh orders worth Rs 1,52,908 crore at the group level during FY18, registering a 7 per cent growth over the previous year. The international orders during the year at Rs 35,853 crore accounted for 23 per cent of the total inflow.

The order intake for the March quarter stood at Rs 49,557 crore, registering a 5 per cent year-on-year growth.