A leading blue-chip stock has set its sights on achieving a 20 percent growth in its construction and mining machinery business by FY26. The company aims to strengthen its market position with plans to double sales over the next five years, signaling strong growth potential and strategic expansion in the sector.
Share Price Movement
In Friday’s trading session, the share price of Larsen & Toubro (L&T) reached an intra-day high of Rs.3,660.00 per share, falling 1.44 percent from its previous close of Rs.3,713.50 apiece. Over the past five years, the share has delivered 170 percent.
What happened
Infrastructure giant Larsen & Toubro (L&T) is projecting a growth of at least 20 percent for its construction and mining machinery division in the upcoming fiscal year.
Arvind K Garg, Senior Vice President and Head of the division shared in an interview with PTI that the company aims to double its sales over the next five years, with a strong growth outlook for the coming year.
L&T’s growth strategy includes introducing new products, such as the recently launched Komatsu PC35 mini excavator, which is expected to significantly boost sales.
The company has an established collaboration with Komatsu Ltd., focusing on the production of hydraulic excavators and other machinery. L&T manages customer engagement, including pre-sales and after-sales services.
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Financials
In its Q2 FY25 financial results, Larsen & Toubro Ltd reported revenue of Rs.61,555 crore, reflecting a 21 percent increase from Rs.51,024 crore in the same quarter of the previous year. The Profit After Tax (PAT) grew by 6.5 percent to Rs.4,099 crore, up from Rs.3,846 crore in the corresponding quarter of the previous year.
In Q2 FY25, the company delivered strong performance across all financial parameters. Group order inflows grew by 13 percent sequentially, pushing the order book past Rs.5 trillion.
With robust execution across core Projects and Manufacturing sectors, group revenues rose by 21 percent year-on-year. Additionally, margins for the Projects and Manufacturing portfolio expanded by 20 basis points, while Net Working Capital to Revenue improved by 170 basis points sequentially to 12.2 percent as of September 2024.
Geographical Revenue Composition
L&T’s revenue composition for Q2 FY25 shows that India contributed 48 percent of the total revenue, while the Middle East accounted for 33 percent. The USA and Europe together made up 17 percent, and the Rest of the World (ROW) contributed 2 percent.
Company Profile
Larsen & Toubro Ltd is a global conglomerate primarily focused on delivering engineering, procurement, and construction (EPC) solutions.
The company operates in several critical sectors, including Infrastructure, Hydrocarbon, Power, Process Industries, Defence, Information Technology, and Financial Services, serving both domestic and international markets.
Written by – Siddesh S Raskar
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