Larsen & Toubro (L&T), one of India's leading engineering and construction conglomerates, has formally requested to withdraw from the Hyderabad Metro Rail project, citing significant financial losses and lack of support from the Telangana government. This development marks a potential turning point for one of the country's largest public-private partnership (PPP) infrastructure projects.

Financial Strain and Government Support

L&T has approached Union Housing and Urban Affairs Minister Manohar Lal Khattar with a proposal to sell its substantial stake in the project. The company currently holds over 90% equity in the venture and has suggested the creation of a new Special Purpose Vehicle (SPV) to facilitate the transfer of ownership to either the state or central government.

The financial performance of L&T Metro Rail, the subsidiary overseeing the project, has been deteriorating:

This data reveals a 21% decline in revenue and a 13% increase in losses year-over-year, underscoring the project's financial challenges.

Multifaceted Challenges

L&T has outlined several structural, financial, and regulatory hurdles that have contributed to the project's difficulties:

1. Land Acquisition Delays: Prolonged processes in acquiring necessary land have impeded progress.
2. Alignment Changes: Modifications to the original plan have caused disruptions and increased costs.
3. Utility Shifting Issues: Complications in relocating utilities have further delayed construction.

These challenges have led to a significant escalation in claims for delays, rising from ₹3,756.00 crore in 2017 to approximately ₹5,000.00 crore by 2020.

Impact of COVID-19

The COVID-19 pandemic exacerbated the project's financial stress:

• A 169-day shutdown during the peak of the pandemic
• Reduced ridership due to widespread adoption of work-from-home arrangements

These factors have contributed to the weakening financial position of the metro project.

Future Expansion Plans

In light of its current financial situation, L&T has expressed its inability to participate in the proposed expansion plans for Phases II-A and II-B of the elevated rail corridor. This stance puts the future growth of the Hyderabad Metro system in question.

The potential exit of L&T from the Hyderabad Metro Rail project raises significant questions about the viability of large-scale PPP infrastructure projects in India. As stakeholders await the government's response to L&T's proposal, the outcome of this situation could have far-reaching implications for urban infrastructure development in the country.

Larsen & Toubro (L&T), a leading Indian multinational conglomerate, has announced a major win for its Heavy Civil Infrastructure (HCI) business vertical. The company has secured a significant order from Nuclear Power Corporation of India Limited (NPCIL) for the 2X1000 MWe Kudankulam Nuclear Power Project (KKNPP - 5 & 6) in Tamil Nadu.

Order Details

The scope of the order includes the mechanical package for the project, encompassing:

• Installation of nuclear reactor and turbine systems with generator and condenser
• Sea water systems
• Polar and trestle cranes
• Other related equipment

Additionally, the project involves accessories, piping, supports, structural steelwork, painting, anti-corrosion coating, insulation, and full testing across various buildings and structures on site.

Project Classification

According to L&T's classification system, this order falls under the 'significant' category, which ranges between ₹1,000 crore to ₹2,500 crore in value.

Strategic Importance

This order reinforces L&T's position in delivering complex nuclear power infrastructure projects for India's clean energy mission. It showcases the company's proven expertise and track record in handling large-scale, technologically advanced projects in the nuclear power sector.

Company Profile

Larsen & Toubro is a USD 30 billion Indian multinational engaged in EPC Projects, Hi-Tech Manufacturing, and Services. The company operates across multiple geographies and has maintained leadership in its major lines of business for eight decades, thanks to its strong customer-focused approach and constant quest for top-class quality.

Investor Relations

In a separate announcement, L&T has revised the date for its participation in the JP Morgan 10th Annual India Conference. The company will now be meeting with the investor group on September 22, 2025, in Mumbai, instead of the previously notified date of September 23, 2025.