Shares of this large-cap infrastructure company are gaining investor attention after securing a major order to deploy advanced welding technology for the Global Nuclear Fusion Project. The company has signed an MoU with the ITER Organization for technical collaboration on the project.
Share Price Movement
In Friday’s trading session, the share price of Larsen & Toubro (L&T) opened at a flatter note of Rs.3,434.95 per share from its previous close Rs.3,442.65 apiece. The share has declined since then and is currently trading at Rs.3,325.00 each, down 3.5 percent.
What happened
India’s leading tech conglomerate, Larsen & Toubro (L&T), has secured a significant order (Rs.1,000 cr – Rs.2,500 cr) from the ITER organisation, based in France, to deploy advanced technologies for assembling ports and complex components in the world’s largest nuclear fusion project in Cadarache, Southern France.
L&T also signed an MoU with ITER for technical collaboration, supporting the development of state-of-the-art fusion systems within the ITER Tokamak. Previously, in 2020, L&T delivered the world’s largest stainless-steel high-vacuum pressure vessel (Cryostat) for ITER amid the COVID pandemic.
Management Commentary
Commenting on the new deal, Mr Anil Parab, Whole-time Director & Sr Executive Vice President, Heavy Engineering and L&T Valves, said: “L&T and ITER are teaming up to combine their strengths to build the world’s largest Tokomak, to prove the feasibility of
nuclear fusion as a large scale and carbon-free source, based on the same principles that powers the Sun. The technical collaboration will showcase L&T’s capabilities in high-tech manufacturing in global markets.”
Order Book
As of Q1 FY25, the total order book stands at Rs.4.91 trillion, reflecting a 19 percent year-on-year increase. Of this, 62 percent is from domestic orders and 38 percent from international sources, with 92 percent of international orders originating from the Middle East.
New Developments
L&T Semiconductor Technology Limited has acquired a 100 percent stake in Silicon Systems, boosting its chip development capabilities for CCTV systems. The company is also pursuing EPC opportunities in the Oil to Chemicals sector in the Middle East, anticipating investments of $50 billion to $60 billion from clients.
Management Guidance
Management guidance indicates that the group-level EBITDA margin will be maintained at 10.2 percent. The margin forecast for the P&M (Plant and Machinery) segment is set at 8.2 percent to 8.25 percent for FY ’25, with expectations for slight improvement based on project execution and job mix.
Financials
In its Q1 FY25 financial results, Larsen & Toubro Ltd reported revenue of Rs.55,120 crore, reflecting a 15.11 percent increase from Rs.47,882 crore in the same quarter of the previous year. The Profit After Tax (PAT) grew by 11.3 percent to Rs.3,445 crore, up from Rs.3,096 crore in the corresponding quarter of the previous year.
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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