Advertisement
Private equity has played a significant role in shaping Indi...
In today’s real estate landscape, fitness is often treated...
In this episode of Prop Personalities, we sit down with Hars...
Luxury real estate is one of the most talked-about segments ...
Welcome to Prop Personalities by Prop News Time - a podcast ...
Larsen & Toubro expects its revenue growth to moderate to 10–12% in the current fiscal, mainly due to disruptions in the Middle East, a key market contributing around 40% of its order backlog. Ongoing geopolitical tensions have impacted project execution, delayed shipments and payments, and increased logistics and input costs. The company indicated that these pressures may continue in the near term. Despite this, L&T maintains a stable margin outlook and steady order book growth expectations, supported by a diversified portfolio and strong domestic demand pipeline.
Larsen & Toubro (L&T) has indicated that its revenue growth for the current financial year may slow down to 10–12%, compared to the previous year, as ongoing disruptions in the Middle East continue to affect its operations in the region. Advertisement
The company highlighted that geopolitical tensions, including the ongoing U.S.-Israel conflict involving Iran, have created challenges for Indian businesses operating in the Middle East. These issues have impacted project timelines, delayed shipments, and increased both logistics and input costs.
During a post-earnings interaction, Chief Financial Officer R. Shankar Raman stated that the impact of these disruptions is expected to become visible over the first half of the current financial year, mainly due to shipment delays. He further indicated that cost pressures and execution challenges may continue to build over the coming quarters.
L&T had reported a 12% growth in revenue in the financial year ended March 31. However, the company also witnessed a decline in market value of around INR 1.1 trillion in the weeks following the escalation of the conflict. Despite this, brokerage firm Jefferies noted that the extent of the selloff may have been excessive.
The Middle East remains a significant market for L&T, accounting for nearly 40% of its total order backlog of INR 7.4 trillion during the quarter. Overall, international orders contributed about 52% to this backlog, underlining the company’s global exposure.
Looking ahead, L&T expects to maintain its operating margins at around 8.3% by fiscal 2027. It also anticipates order inflows to grow in the range of 10–12%. The company clarified that while many contracts include provisions for time extensions and cost recovery under exceptional circumstances, reimbursements may take time to materialise.
Market analysts have raised concerns about potential risks to L&T’s Middle East business if geopolitical tensions continue. These include possible delays in project execution and rising costs. At the same time, analysts believe that the company’s diversified order book and strong domestic infrastructure pipeline could help offset some of these challenges.
Separately, L&T announced that P. Ramakrishnan will take over as the next Chief Financial Officer, with R. Shankar Raman set to step down at the end of June.
For the financial year 2026, the company reported a 7% increase in consolidated profit after tax, while its overall expenses rose by around 12%.
Source Reuters
5th Jun, 2025
25th May, 2023
11th May, 2023
27th Apr, 2023
Advertisement
Facebook
Whatsapp
