Larsen & Toubro (L&T), India's leading engineering and construction conglomerate, has reported a strong performance for the second quarter of the fiscal year, marked by significant growth in order inflow and steady financial results.

Financial Highlights

L&T demonstrated resilience in its financial performance for the September quarter:

The company's order book saw a substantial boost, with the international segment contributing 49% to the total orders received.

Strategic Expansion and Outlook

L&T is strategically diversifying its portfolio:

• Expanding into green hydrogen, semiconductors, and defence sectors
• Maintaining its FY26 guidance for the core Engineering & Construction (E&C) business:
  • Over 10% order growth
  • 15% revenue growth
  • 8.5% margin target

Middle East Momentum

The surge in order inflow was primarily driven by strong demand from the Middle East, highlighting L&T's growing international presence and the region's increasing infrastructure investments.

IT Services Segment Performance

The company faced some headwinds in its IT services portfolio, which contributed to the 30 basis points decrease in operating margin. This compression in the IT services segment reflects the broader challenges faced by the tech industry.

Hyderabad Metro Divestment

L&T has reached an agreement with the Telangana government regarding its stake in the Hyderabad Metro project:

• The state government will take over ₹13,000.00 crore of debt
• L&T will receive ₹2,000.00 crore in equity

This deal is expected to help L&T optimize its balance sheet and focus on its core business areas.

Analyst Outlook

The market sentiment towards L&T remains positive:

• Multiple analysts have maintained 'Buy' ratings
• Target prices range from ₹4,400.00 to ₹4,766.00
• This represents a potential upside of 9-18% from the Friday closing price of ₹4,031.20

L&T's robust order book growth, strategic expansions, and strong financial performance continue to make it an attractive proposition for investors looking at the infrastructure and engineering sector in India.

Larsen & Toubro (L&T), India's leading engineering and technology conglomerate, has announced a strategic partnership with US-based General Atomics Aeronautical Systems Inc. (GA-ASI) to manufacture Medium Altitude Long Endurance (MALE) Remotely Piloted Aircraft Systems (RPAS) in India for the Indian armed forces.

Key Partnership Details

Strategic Implications

This partnership marks a significant milestone in India's pursuit of a self-reliant defense ecosystem. The collaboration aims to:

1. Incorporate critical technology transfers
2. Fulfill indigenous content requirements
3. Strengthen Indo-US defense collaboration
4. Foster a competitive, globally integrated aerospace manufacturing base in India

Leadership Perspectives

S.N. Subrahmanyan, Chairman & Managing Director of L&T, emphasized the unique opportunity this partnership presents for India to indigenously manufacture state-of-the-art unmanned platforms. He expressed confidence that the alliance would significantly enhance India's defense capabilities and advance self-reliance in aerospace technologies.

Dr. Vivek Lall, Chief Executive of General Atomics Global Corporation, highlighted the commitment to supporting India's vision for self-reliance and indigenous manufacturing in aerospace. He stated that the collaboration aims to deliver cutting-edge MALE RPAS solutions to enhance the operational readiness of the Indian armed forces and contribute to a strong, sustainable defense ecosystem in India.

About the Companies

Larsen & Toubro (L&T)

• USD 30 billion Indian multinational
• Engaged in EPC Projects, Hi-Tech Manufacturing, and Services
• Operating across multiple geographies
• Known for customer-focused approach and top-class quality

General Atomics Aeronautical Systems, Inc. (GA-ASI)

• World's foremost builder of Unmanned Aircraft Systems (UAS)
• Logged over 9 million flight hours
• Predator® line of UAS has flown for over 30 years
• Products include MQ-9A Reaper®, MQ-1C Gray Eagle®, MQ-20 Avenger®, and MQ-9B SkyGuardian®/SeaGuardian®
• Focused on long-endurance, multi-mission solutions for persistent situational awareness and rapid strike capabilities

This strategic partnership between L&T and GA-ASI represents a significant step towards enhancing India's defense capabilities and promoting self-reliance in the aerospace sector. By combining L&T's robust manufacturing expertise with GA-ASI's proven technology, the collaboration is poised to deliver advanced MALE RPAS solutions that will bolster the operational readiness of the Indian armed forces.