Larsen & Toubro: Business Overview and Financial Analysis

Larsen & Toubro Limited is India’s largest engineering, procurement, construction, and manufacturing conglomerate, holding a significant market position across critical industrial infrastructure segments. The company executes large-scale, complex projects globally, spanning infrastructure development, hydrocarbon engineering, power systems, defence manufacturing, aerospace, and nuclear engineering. In addition to its core Engineering, Procurement, and Construction (EPC) operations, L&T operates services businesses across information technology, digital transformation, and financial services.

L&T Consolidated Financial Performance (FY2025-26)

Larsen & Toubro’s full-year financial performance reflects strong execution momentum across major domestic infrastructure projects alongside an expanding international hydrocarbon pipeline.

• Consolidated Gross Revenue – Rs 2,47,120 crore (+12.5% YoY)
• Consolidated Operating Profit (EBITDA) – Rs 28,420 crore (+10.8% YoY)
• Consolidated Net Profit (PAT) – Rs 14,310 crore (+11.2% YoY)
• Overall EBITDA Margin – 11.5% for the full fiscal year
• Final Equity Dividend Recommended – Rs 28 per share of face value Rs 2

Healthy revenue growth reflects L&T’s accelerated milestone completions across active project sites despite macroeconomic variations affecting global supply chains.

Order Book and Order Inflows (As of March 31, 2026)

L&T’s project pipeline remains resilient, providing multi-year revenue visibility supported by domestic projects and international orders, particularly from the Middle East.

• Total Cumulative Order Book – Rs 4,78,500 crore (+7.2% YoY)
• International Share of Order Book – 38.0% of the total pipeline
• Domestic Share of Order Book – 62.0% of overall project allocations
• Full-Year Fresh Order Inflow – Rs 3,02,400 crore (+14.3% YoY)
• Middle East Contribution to International Inflows – 82.0% of foreign orders

Larsen & Toubro’s large order book provides strong revenue visibility, equivalent to more than two years of annual revenue.

L&T Business Segment Revenue Mix (FY2025-26)

Larsen & Toubro generates consolidated revenue across engineering, manufacturing, development, technology services, and financial services businesses.

• Infrastructure Projects Segment – 46.5% of consolidated revenue
• IT & Technology Services Segment – 21.2% of consolidated revenue
• Energy Projects (Hydrocarbon & Power) Segment – 18.3% of consolidated revenue
• Financial Services Vertical – 6.8% of consolidated revenue
• Hi-Tech Manufacturing Segment – 4.5% of consolidated revenue
• Development Projects & Others – 2.7% of consolidated revenue

The infrastructure and energy segments remain the operational foundation of L&T’s business, while technology services contribute to revenue diversification and cash generation.

Infrastructure Projects Segment Performance (FY2025-26)

L&T’s core infrastructure segment encompasses heavy civil construction, transportation infrastructure, water treatment systems, buildings, and factories.

• Segment Total Revenue – Rs 1,14,910 crore (+13.1% YoY)
• Segment Operating EBITDA Margin – 7.1% for the full year
• Total Share of Annual Order Inflow – Rs 1,42,100 crore of fresh bookings
• Domestic Share of Segment Infrastructure Orders – 74.0% of active sites

While revenue execution remained strong due to infrastructure spending, legacy low-margin projects affected L&T’s overall segment operating margin.

L&T Energy Projects Segment Performance (FY2025-26)

Larsen & Toubro’s energy projects segment includes extensive onshore and offshore hydrocarbon engineering projects alongside thermal and renewable power infrastructure.

• Segment Total Revenue – Rs 45,223 crore (+15.4% YoY)
• Segment Operating EBITDA Margin – 9.2% for the full year
• Fresh International Energy Orders – Rs 64,800 crore added during the fiscal year
• Renewable Power Sub-Segment Order Share – 22.0% of total energy asset entries

Large project awards across Middle Eastern oil and gas markets supported L&T’s energy segment revenue and profitability during the financial year.

Latest Quarterly Financial Performance (Q4 FY2025-26)

L&T’s fourth-quarter financial performance reflects accelerated project execution and billing activity alongside controlled working capital levels.

• Consolidated Quarterly Revenue – Rs 68,120 crore (+10.4% YoY)
• Consolidated Quarterly EBITDA – Rs 8,110 crore (+8.9% YoY)
• Consolidated Quarterly PAT – Rs 4,410 crore (+6.3% YoY)
• Quarterly Consolidated EBITDA Margin – 11.9% for the March quarter
• Fresh Capital Inflows Booked in Q4 – Rs 72,300 crore across all divisions

The March quarter typically represents L&T’s strongest seasonal execution period, supported by project milestone completions ahead of financial year-end.

L&T Capital Allocation and Working Capital Position (As of March 31, 2026)

Larsen & Toubro maintains a focus on liquidity and working capital management to limit dependence on expensive short-term financing.

• Net Working Capital-to-Revenue Ratio – 12.2% (improved from 13.0% YoY)
• Gross Outstanding Debt – Rs 1,18,400 crore (consolidated including finance arms)
• Consolidated Net Debt-to-Equity Ratio – 0.62 times leverage allocation
• Cash and Cash Equivalents Balance – Rs 24,150 crore held across liquid reserves
• Full-Year Free Cash Flow Generation – Rs 16,840 crore across operations

Improved billing and customer collection cycles have reduced L&T’s net working capital requirements and supported internal cash flow generation.

Management Commentary and Strategic Outlook (FY2025-26)

L&T’s management strategy focuses on margin protection, disciplined project bidding, and the targeted monetisation of non-core infrastructure investments.

• Revenue Expansion Target – Management targets a consolidated revenue growth guidance band of 12% to 15% for the upcoming fiscal year.
• Order Inflow Momentum – Order inflow expansion is guided to grow by 10% to 12%, supported by domestic public infrastructure and international energy allocations.
• Operating Margin Directions – Project bidding will prioritise preserving baseline core EPC margins above 8.5% by passing on volatile commodity variations.
• Middle East Risk Mitigation – Management is actively monitoring execution resources in the Gulf region to prevent labour shortages across large projects.
• Asset Monetisation Objectives – Plans are underway to fully divest equity exposures across legacy road concessions and non-core power plants.
• Capital Expenditure Focus – Green hydrogen manufacturing and semiconductor chip design will receive dedicated group capital funding over the next 24 months.

Larsen & Toubro’s strategic focus reflects a gradual transition towards asset-light operations, improving manufacturing and engineering asset utilisation while expanding cash flow conversion.

Citations

[1] Larsen & Toubro Limited Audited Consolidated Financial Statements and Auditor Reports submitted to BSE Limited (May 2026).
[2] Transcript of Larsen & Toubro Limited Q4 and Full-Year Ended March 31, 2026 Institutional Earnings Conference Call.
[3] Larsen & Toubro Limited Comprehensive Investor Presentation and Segment Performance Fact Sheet (FY2025-26).
[4] Ticker Finology Database on Larsen & Toubro Limited (LT).

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Disclaimer
The information presented above on Larsen & Toubro Limited has been compiled from the company's Annual Reports, Investor Presentations, Earnings Call (Concall) Transcripts, official regulatory filings and the financial data available on Finology Ticker. Certain figures, classifications or comparisons may vary due to differences in accounting policies, reporting methodologies or subsequent restatements by the company. This content is intended solely for informational purposes and should not be considered as investment advice. Investors are advised to refer to the latest company filings and the updated financial data, ratios and disclosures available on the Finology Ticker Larsen & Toubro Limited page before making any investment decision