LARSEN & TOUBRO LIMITED – Comprehensive StockAnalysis Report | Scrolls
- Editor
- 3 days ago
- 2 min read
by Karnivesh | 2026
Larsen & Toubro stands at the center of a powerful multi-year infrastructure and energy capex cycle, backed by its unmatched scale, execution capabilities, and diversified business model. The company operates an integrated EPC platform spanning infrastructure, energy, hi-tech manufacturing, IT services, and financial services, giving it resilience across economic cycles and the ability to capture large, complex projects globally.
Financial performance remains strong, with double-digit revenue and earnings growth, improving operating margins, rising return ratios, and a materially better working-capital profile. A record order book of ₹6.67 trillion provides over two years of revenue visibility, while a ₹10.4 trillion prospect pipeline underpins sustained growth. Nearly half of the order book is international, primarily in the Middle East, where energy transition and hydrocarbon capex are accelerating. Domestically, India’s ₹150+ trillion infrastructure pipeline and committed government capex create a long runway for growth.
Strategically, L&T is improving profitability by exiting low-return assets, prioritizing better-margin projects, and leveraging scale, digitalization, and operational efficiency. New growth vectors green hydrogen, green ammonia, semiconductors, data centers, and defense manufacturing offer higher-margin, technology-led opportunities that can structurally lift returns over time. Strong balance sheet discipline, minimal net debt, and consistent capital returns through dividends and buybacks further strengthen the investment case.
Key risks remain execution-related, given the size and complexity of the order book, alongside margin pressure in hydrocarbons, geopolitical exposure in the Middle East, labor availability, and commodity volatility. However, these risks are partly mitigated through disciplined bidding, hedging strategies, project diversification, and strong customer profiles.
Overall, the investment thesis rests on L&T’s ability to convert its unprecedented order visibility into steady execution, gradual margin expansion, and scalable new-age businesses. If delivered, this combination positions L&T for sustained earnings compounding and potential valuation re-rating over the medium to long term, while downside risks are supported by balance-sheet strength and diversified cash flows.
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