L&T: The Iconic Builder
There is an element of similarity among Lotus Temple, ATC Tower in Mumbai Airport and New Delhi Airport, ICICI Bank Building in Cyber Towers, Hyderabad, Wankhede Stadium in Mumbai, Bengaluru’s Kempegowda Airport and. more recently Kevadiya’s Statue Of Unity. Apart from being the quintessential landmarks of India, they are all being built by one of the largest Indian MNC firms and India’s leading construction company, Larsen & Toubro, or L&T.
“L&T has always been at the forefront of innovation that has enabled us to execute some of the largest, tallest, longest, smartest projects that make India and the world proud and, at the same time, retain our leadership across domains. From submarines to space rockets, airports to highways, metro rail to freight corridors, floating docks to off-shore oil platforms and everything in the sphere of urban & civil infrastructure, we have been setting new benchmarks in the industry,” says S.N. Subrahmanyan, MD & CEO of L&T, in an e-mailed response.
The tiny partnership firm set up on 1 May 1938 is now a leading engineering and construction conglomerate, operating at the upper end of the technology spectrum. Across the last eight decades, the Mumbai-based company has kept pace with technological developments as well as the evolving needs of the nation. L&T has business interests in engineering, construction, manufacturing goods, information technology, and financial services, and has offices worldwide. It addresses critical needs in key sectors such as Hydrocarbon, Infrastructure, Power, Process Industries and Defence, for customers in over 30 countries around the world. Furthermore, it is engaged in core, high impact sectors of the economy and our integrated capabilities span the entire spectrum of ‘design to deliver’.
L&T turned in a commendable performance on key financial parameters in 2017-18. Even though awarding of infrastructure projects continued to be unpredictable in terms of timelines, the company registered a 7 per cent growth in fresh order inflows of Rs 152,908 crore over inflows in the previous year. The unexecuted order book at the end of 2017-18 stands at Rs. 263,107 crore, which provides good revenue visibility in 2018-19. While execution was impacted in 2017-18 due to disruptions caused by GST as well as bottlenecks in some projects, L&T clocked revenues of Rs 119,862 crores. This translates to a growth of 9.5 per cent on a like-to-like basis over the previous year after adjusting for excise duties, which were subsumed in GST from 1 July 2017. Profit after tax recorded an all-time high of R 7,370 crore – representing a 22 per cent increase over PAT of 2016-17.
“L&T’s sector and geographical diversification has ensured it grows faster than the market even in a difficult environment. Strong brand equity associated with quality work as well as its balance sheet are the icing on the cake. While top management’s vision and endeavour to grow profitably and not at the cost of balance sheet and margins is its biggest asset, transparency and investor friendly are the key positives of the company,” says Lavina Quadros, Research Analyst with Jefferies.
“L&T is the best technology-enabled engineering, procurement and construction (EPC) company in country. The company has created capabilities of design, planning and execution for any type of infrastructure asset. They are always first in country for building any asset, be it airports, metro, irrigation, bridges, etc. L&T has developed these capabilities over the period by following process of continuous skill upgradation. It has invested in manpower and technology ahead of others, which has helped L&T achieve better profitability, ” explains Vijay Agrawal, Executive Director at Equirus Capital.
