L&T Secures ₹2,500-5,000 Cr Orders for Key Projects in UAE, Kuwait, and Saudi Arabia

Larsen & Toubro Construction's Power Transmission & Distribution business has recently secured contracts in the Middle East, showcasing its prowess in the energy infrastructure sector. The company's endeavors include projects in the United Arab Emirates and Kuwait, further solidifying its regional presence.

UAE Power Infrastructure Boost

In the United Arab Emirates, L&T's Power Transmission & Distribution business has bagged an order for the comprehensive development of a 400/132kV Substation. The scope of work encompasses engineering, supply, construction, installation, testing, and commissioning, along with key components such as transformers, reactors, and Substation Control and Monitoring Systems (SCMS).

Kuwait's Energy Evolution

Meanwhile, in Kuwait, the company has successfully secured an order for the establishment of 400kV Overhead Transmission Lines. This extensive network, covering a route length of over 100 km, includes vital interconnections through 400kV Underground Cables. The project is poised to play a crucial role in evacuating and generating power, addressing the growing energy needs of the region.

Continued Success in Saudi Arabia

Adding to its accolades, L&T's construction arm On Wednesday, December 27 secured a major engineering, procurement, and construction order for the Amaala project in Saudi Arabia's Red Sea region. Valued in the ₹5,000 crore to ₹10,000 crore range, this project highlights the company's global reach and capabilities in delivering complex ventures.

Corporate Performance

Despite a robust order pipeline and healthy revenue growth, concerns have been raised about Larsen & Toubro Ltd's core business margin. The engineering and capital goods giant has adjusted its Ebitda margin guidance for FY24, citing a range of 8.5-9.0%, down from the earlier projection of 9%. Market analysts emphasize the importance of monitoring order inflow and execution efficiency for sustained growth.

Larsen and Toubro's stock has delivered remarkable growth, surging by 13.64% in the last month, 41.56% over the past six months, 66.01% in the past year, and 152.46% over the last five years. This reflects a strong and consistent upward trajectory in the company's stock performance across different time periods.

Market Reaction and Investor Perspective

In the stock market, L&T witnessed a slight dip, closing about 1% lower, possibly influenced by the adjusted margin guidance. Analysts point out that strengthened infrastructure business and the company's buyback at ₹3,000 have positively impacted stock. Investors with a one-year horizon are advised to closely monitor order inflow and execution performance to gauge future growth prospects.

Final Words

L&T Construction has been successful in the Middle East, showing its dedication to improving power infrastructure in the region. Investors are paying close attention to the company's ability to get orders and efficiently complete projects for long-term growth.