Larsen & Toubro (L&T) is experiencing significant growth in its order book, reaching around Rs 4.12 trillion as of June, with West Asia contributing 25% of this total. This surge in orders is largely attributed to a construction boom in Saudi Arabia. L&T's hydrocarbon division has also conducted a major recruitment drive in India, highlighting the strategic importance of the West Asian market for the company. L&T's proactive approach includes localizing offices, staff, and forming strategic partnerships in the region. This expansion and strengthened foothold in West Asia showcase L&T's commitment to serving the dynamic construction market in the region.
Larsen & Toubro (L&T) is witnessing a substantial expansion in its order book, reaching approximately Rs 4.12 trillion as of June, with West Asia contributing a noteworthy 25%. The surge in the order book is primarily attributed to a robust construction boom in Saudi Arabia. L&T's hydrocarbon division recently conducted a widespread recruitment drive in India, emphasizing the strategic importance of West Asia for the engineering and infrastructure giant.
Notably, the outstanding order book has seen a significant shift, with West Asia accounting for 25%, compared to 11.4% at the beginning of FY20, making L&T one of the leading Engineering, Procurement, and Construction (EPC) contractors in the region by 2023.
The company's proactive approach includes localizing offices, staff, and establishing strategic partnerships, contributing to its strengthened foothold in West Asia. To address funding requirements, L&T has explored non-fund-based (NFB) limits in these markets, reflecting the company's commitment to leveraging diverse financial instruments.
L&T's robust presence in the region is further exemplified by the deployment of more than 10,000 employees on average in West Asia over the past three years, underscoring the scale and scope of various projects undertaken by the company. This extensive manpower deployment reflects L&T's commitment to executing projects efficiently and meeting the demands of the dynamic West Asian market.
A 2023 Deloitte report on the Gulf Cooperation Council (GCC) construction market provides valuable insights, revealing that contracts worth approximately $94 billion were awarded in 2022. Despite a year-on-year decrease exceeding $20 billion, Saudi Arabia emerges as a standout performer. With contracts nearing $54 billion, Saudi Arabia's project market now surpasses the combined figures of other GCC states, demonstrating its resilience and attractiveness for investments in the construction sector.
As L&T continues to consolidate its position as a leading EPC contractor in West Asia, the company's success serves as a testament to its adaptability, strategic initiatives, and commitment to localizing its operations. The evolving dynamics of the construction market in the region present both challenges and opportunities, and L&T's approach underscores the importance of understanding and aligning with the unique characteristics of the West Asian business landscape.
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