History of Larsen & Toubro

Larsen & Toubro Ltd, commonly known as L&T, is a renowned Indian multinational conglomerate with diversified business interests spanning engineering, construction, manufacturing, technology, information technology, and financial services. Established in Mumbai and boasting its technical services headquarters in Chennai, L&T has earned a place among the world's top five construction companies.  L&T group was founded on February 7, 1946, with the efforts of two Danish engineers, Henning Holck-Larsen and Søren Kristian Toubro, who found refuge in India during a critical period. L&T had modest beginnings as a representative of Danish dairy and allied equipment manufacturers.  However, the onset of World War II in 1939 provided L&T with opportunities for ship repair and refitting, leading to the establishment of a new company called Hilda Ltd. L&T expanded its operations into ship repair and fabrication during this time. An unexpected turn of events occurred when German engineers, initially set to build a soda ash plant for the Tatas, were interned in British India due to World War II suspicions. This circumstance allowed L&T to venture into installation services. Incorporated in 1946, ECC (Engineering Construction & Contracts) marked a pivotal moment as the company shifted its focus towards construction projects, eventually becoming the construction division of L&T. By 1947, the company signed an agreement with Caterpillar Tractor Company, USA, to market earthmoving equipment. In December 1950, L&T became a publicly traded company with a paid-up capital of ₹20 lakh. The company's sales turnover for that year amounted to ₹1.09 crore. In 1956, a significant part of L&T's Mumbai office moved to ICI House in Ballard Estate, later renamed L&T House, which remains the company's current headquarters. From the early stages, L&T started collaborating with various notable organisations such as ISRO, DRDO, etc. In 1976, L&T's construction division, ECC, bid for a major airport project in Abu Dhabi, which led to its merger with L&T. ECC was subsequently rebranded as L&T Construction, becoming the largest revenue contributor to the L&T Group.  Recently, L&T secured the 2nd position in the 2022 Top 25 EPC Contractors list in the Middle East by Oil & Gas Middle East, and it achieved the 4th rank in the 2021 LinkedIn Top Companies list in India.

Larsen & Toubro Business Segments 

Operating in more than 50 countries across the globe, L&T has established itself as a prominent multinational conglomerate with a strong, customer-centric approach. 

• Construction: L&T Construction is India's largest construction organisation and is ranked among the world's top contractors. The company offers integrated ‘design-to-build’ solutions for complex onshore and offshore hydrocarbon projects across multiple geographies. Its track record includes the simultaneous execution of multiple, complex, large-value projects, meeting stringent delivery schedules, quality, and safety norms.

• Hydrocarbon: L&T offers integrated ‘design-to-build’ solutions for complex onshore and offshore hydrocarbon projects across multiple geographies. Its track record includes the simultaneous execution of multiple, complex, large-value projects, meeting stringent delivery schedules, quality, and safety norms.

• Power: L&T executes power projects – coal, gas-based, and nuclear power plants, as well as transmission systems, substations, and distribution projects.

• Minerals & Metals: L&T stands as a prominent leader in delivering comprehensive EPC (Engineering, Procurement, and Construction) solutions in the domains of minerals, metals, and the handling of bulk materials. Their expertise extends to servicing extensive industrial setups, encompassing steel, aluminium, copper, and zinc complexes, as well as related infrastructure, catering to the mining industry. 

• Heavy Engineering: L&T Heavy Engineering manufactures and supplies custom-engineered critical equipment and systems to process industries such as fertiliser, chemical, refinery, petrochemical, and oil & gas, as well as to sectors such as thermal & nuclear power, aerospace, defence, and steel.

• Defence Engineering: L&T's Defence Engineering business offers end-to-end solutions in the areas of defence, aerospace, and naval systems.

• Defence Shipbuilding: L&T's Defence Shipbuilding business designs and builds a wide range of vessels for defence and commercial applications.

• Construction and Mining Machinery: L&T supplies equipment to infrastructure, irrigation, and mining sectors, meeting global standards. This features a partnership with South Korean giant Komatsu.

• Technology Services: L&T Technology Services provides design and development solutions in multiple industries, with centres in India and the US.

• Valves: L&T Valves offers flow-control solutions globally through strategic partnerships.

• Financial Services: L&T Finance Holdings offers diverse financial products and services, including rural, wholesale, housing, and infrastructure finance, along with general insurance and advisory services.

• Real Estate: L&T Realty specialises in large residential and mixed-use developments, focusing on transparency, consumer engagement, and efficient design.

• Edutech: L&T EduTech offers industry-ready education programs in partnership with universities, corporations, NGOs, and governments.
• Greentech: L&T's Green Manufacturing and Development business promotes a greener future, covering the Green Energy Value Chain from development to manufacturing and EPC services.

As of March 31, 2022, L&T has a network comprising 93 subsidiaries, 5 associate companies, 27 joint ventures, and 35 joint operations, including,

• L&T Mindtree: L&T Mindtree, a subsidiary of Larsen & Toubro, is a listed Indian multinational IT services and consulting company headquartered in Mumbai. It was founded in 1996 and employs over 82,000 professionals. In 2019, Larsen & Toubro acquired Mindtree, and in 2022, it merged with L&T Infotech (LTI) to create LTI Mindtree. 

• L&T Technology Services Ltd: L&T Technology Services Ltd is a listed global leader in Engineering and R&D (ER&D) services. It is a publicly listed subsidiary of Larsen & Toubro Limited, the $21 billion Indian conglomerate operating in over 30 countries. In FY 2023, LTTS scaled the milestone of a $1 billion revenue run rate. LTTS specialises in disruptive technology spaces such as 5G, Artificial Intelligence, Collaborative Robots, Digital Factory, and Autonomous Transport.

• L&T Finance Holdings Ltd: L&T Finance Holdings Ltd is a non-deposit-taking and non-banking financial company that offers lending solutions. The company offers financing solutions for rural and urban customers, including financing for two-wheelers, consumer goods, homes, farm equipment, women entrepreneurs, rural groups, real estate, and infrastructure. 

Larsen & Toubro Team Management

1. N. Subrahmanyan, MD

N. Subrahmanyan assumed this role on July 1, 2017. In addition to his position as Managing Director, he also holds the titles of Chief Executive Officer (CEO) and Vice Chairman on the boards of L&T Mindtree and L&T Technology Services. He also serves as the Chairman of L&T Metro Rail (Hyderabad) Limited and holds the position of Director and Chairperson at L&T Finance Holdings Ltd. Mr. Subrahmanyan plays a pivotal role in steering L&T's diverse business interests, with a particular emphasis on digitalisation, big data, and predictive analysis.

Larsen & Toubro Corporate Actions

Buyback:

• L&T announced a buyback of up to ₹6,10,16,949 Equity Shares (Six Crore only), which represented approximately 4.29% of the total paid-up equity share capital, on October 15, 2018.

Bonus:

• On July 14, 2017, Larsen & Toubro Limited issued a bonus share in the ratio of 1:2.
• On July 13, 2013, Larsen & Toubro Limited issued a bonus share in the ratio of 1:2.
• On October 3, 2008, Larsen & Toubro Limited issued a bonus share in the ratio of 1:1.
• On September 29, 2006, Larsen & Toubro Limited issued a bonus share in the ratio of 1:1.

Larsen & Toubro Management Outlook 

• The company plans to invest nearly $4 billion to develop 2-3 million tonnes of green hydrogen and ammonia capacity. L&T has initiated discussions with coastal states in India to acquire 500-1,000 acres of land for hydrogen facilities.

• L&T targets a revenue of ₹2.7 trillion by FY 2026, up from ₹1.4 trillion in FY 2021. The order inflow goal is set at ₹3.4 trillion by FY 2026, compared to ₹1.7 trillion in FY 2021. This is expected to raise the return on equity to over 18% by FY 2026, up from 10% (excluding exceptional items) reported in FY 2021.

• L&T's strategy focuses on creating added value through the circular economy for customers, employees, and society as a whole. This approach is also aimed at increasing value for the company's shareholders.

• L&T is committed to sustainability and innovation. They aim to promote eco-friendly growth and have a strong focus on resource efficiency and decarbonisation of their businesses. This reflects their dedication to environmental and social responsibility.