Goldman Sachs has revised its stance on key Indian industrial stocks, flagging concerns around the impact of tariff-related uncertainty on capital expenditure, order inflows, and revenue visibility over the next two financial years.
The brokerage downgraded L&T (Larsen & Toubro) shares to ‘Neutral’ from ‘Buy’, setting a revised target price of ₹3,330 per share. Goldman Sachs noted that rising global and domestic trade-related uncertainty could delay new factory capex, which may weigh on order growth for large engineering and construction companies like L&T. While lower commodity prices and financing costs could provide partial relief, the near-term growth outlook appears cautious.
Conversely, the firm has upgraded KEI Industries to ‘Buy’ from ‘Neutral’, raising the target price to ₹2,980 per share, citing improved visibility in core segments and resilience in margin performance despite sectoral headwinds.
Goldman Sachs also warned that ports and logistics businesses could face a 4–5% revenue impact in FY26–27, as global supply chain disruptions and protectionist measures weigh on throughput and operational efficiency. This may lead to lower valuation multiples for some capital goods stocks, the brokerage added.
Overall, the note suggests that Indian industrials are entering a more volatile phase, where companies with strong domestic linkages and efficient cost structures may outperform amid external trade challenges.
Disclaimer: This article is based on Goldman Sachs’ research note and does not represent the views of the author or the publication. Investors are advised to consult a certified financial advisor before making any investment decisions.
