LARSEN & TOUBRO

It’s all about Imagineering

A SPECIAL DEDICATION

TO

PROF. SHILPA

OF THE SUBJECT

ECONOMICS
ACKNOWLEDGEMENT
The overall chair for this project on LARSON &
TOUBRO in ECONOMICS was Miss KOMAL RAJPUT(47).
All the other group members were co-chairs of the
development of the sectoral.
The co-chairs of the source/subject level expert
groups provided their time and expertise along with other
experts, from a wide range of well wishers, who also gave of
their time to write, comment and review the text and attend
the discussion gatherings. Encouragement and support were
received from the honorable PROF.SHILPA.
Technical and organizational support for the
project was provided by the B.M.S DEPARTMENT of SARAF
INSTITUTE which also oversaw the initiation of the project
including both the sectorals.
GROUP MEMBERS
 KOMAL – 47
 KHYATI – 51
 RAJPREET – 4
 PREKSHA – 23
 ARTI – 11
 KHATUN - 39
 AKSHI – 26
PROFILE
 Company Profile: Larsen & Toubro Limited
 Ticker: 500510
 Exchanges: OTH
 2008 Sales: 292,900,000,000
 Major Industry: Machinery & Equipment
 Sub Industry: Construction Machinery
 Country: INDIA
 Employees:31941
OVERVIEW
 Larsen & Toubro Limited (L&T) is a technology, engineering,
construction and manufacturing company. It is one of the
largest and most respected companies in India's private sector.
 Seven decades of a strong, customer-focused approach and the
continuous quest for world-class quality have enabled it to attain
and sustain leadership in all its major lines of business.
 L&T has an international presence, with a global spread of offices. A
thrust on international business has seen overseas earnings grow
significantly. It continues to grow its overseas manufacturing
footprint, with facilities in China and the Gulf region.
 The company's businesses are supported by a wide marketing and
distribution network, and have established a reputation for strong
customer support.
 L&T believes that progress must be achieved in harmony with the
environment. A commitment to community welfare and
environmental protection are an integral part of the corporate vision.
HISTORY
 The evolution of L&T into the
country's largest engineering and
construction organization is among
the most remarkable success stories
in Indian industry.

 L&T was founded in Bombay (Mumbai)

in 1938 by two Danish engineers, Henning Holck-Larsen
Henning Holck - Larsen and Soren
Kristian Toubro. Both of them were
strongly committed to developing
India's engineering capabilities to
meet the demands of industry.

 Beginning with the import of

machinery from Europe, L&T rapidly
took on engineering and construction
assignments of increasing
sophistication. Today, the company
sets global engineering benchmarks Soren Kristian Toubro
in terms of scale and complexity.
HISTORY IN A NUTSHELL
 1938, the two friends decided to forgo the
comforts of working in Europe, and started their
own operation in India.
 With the start of the Second World War in 1939,
imports were restricted, compelling them to
start a small work-shop to undertake jobs and
provide service facilities.
 Germany's invasion of Denmark in 1940
stopped supplies of Danish products. They
started manufacturing dairy equipment
indigenously. These products proved to be a
success, and L&T came to be recognized as a
reliable fabricator with high standards.
 In 1944, ECC was incorporated. Around then,
L&T decided to build a portfolio of foreign
collaborations.
 In 1945, L&T signed an agreement with
Caterpillar Tractor Company, USA, for
marketing earthmoving equipment.
 On 7th February 1946, Larsen & Toubro Private
Limited was born.
 In 1948, fifty-five acres of undeveloped marsh
and jungle was acquired in Powai.
 In December 1950, L&T became a Public
Company with a paid-up capital of Rs.2 million.
The sales turnover in that year was Rs.10.9
million
In 1956, a major part of the company's Bombay
office moved to ICI House in Ballard Estate. A
decade later this imposing grey-stone building
was purchased by L&T, and renamed as L&T
House - its Corporate Office.
 The sixties saw a significant change at L&T - S.
K. Toubro retired from active management in
1962
 The sixties were also a decade of rapid growth
for the company, and witnessed the formation
of many new ventures: UTMAL (set up in 1960),
Audco India Limited (1961), Eutectic Welding
Alloys (1962) and TENGL (1963).
 By 1964, L&T had widened its capabilities to
include some of the best technologies in the
world. In the decade that followed, the company
grew rapidly, and by 1973 had become one of
the Top-25 Indian companies
 In 1976, Holck-Larsen was awarded the
Magsaysay Award for International
Understanding in recognition of his contribution
to India's industrial development. He retired as
Chairman in 1978.
 Today, L&T is one of India's biggest and best
known industrial organisations with a
reputation for technological excellence, high
quality of products and services, and strong
customer orientation. It is also taking steps to
grow its international presence.
VISION
 The L&T vision
reflects the
collective goal of
the company. It
was drafted
through a large
scale interactive
process which
engaged
employees at every
level, worldwide.
GLOBAL PRESENCE
 L&T has a global presence. A thrust on
international business over the years has seen
overseas revenues growing steadily.
 The company has manufacturing facilities in
India, China, Oman and Saudi Arabia.
 It has a global supply network with offices in 10
locations worldwide, including Houston,
London, Milan, Shanghai, Seoul.
 Customers include global majors in over 30
countries.
AWARDS & RECOGNITION
 MAJOR AWARDS IN
THE YEAR 2007-08
-IMC Ramkrishna Bajaj
National Quality Award
-Amity Corporate Excellence
Award 2007
-ICAI Award
-National Top Exporters Trophy
-Emerging Global Company
Award
SUBSIDARIES AND
ASSOCIATES
The L&T Group has a number of
subsidiaries & associates worldwide

 Engineering and construction

 Machinery and Industrial products

 Information Technology

 Financial Services
ORGANISATION
STRUCTURE
"The company that we run has a
strong heritage of professionalism that places
the highest value on merit and integrity. In the
70th year of the existence of L&T, all the
directors on our board are conscious of our
responsibility in transforming the organisation
to make it truly world class, to ensure its
continued long term success and growth.“
- BOARD OF DIRECTORS
 EXECUTIVE DIRECTORS

A. M. NAIK
Chairman & Managing
Director R. N. MUKHIJA
J. P. NAYAK Whole-time Director &
Whole-time Director & President
President
(Electrical & Electronics)
(Machinery & Industrial
Products)

Y. M. DEOSTHALEE
Whole-time Director
& M. V. KOTWAL
Whole-time Director &
Senior Executive Vice
Chief Financial K. V. RANGSWAMI President
Officer Whole-time Director &
K. VENKATARAMANAN President
Whole-time Director & President V. K. MAGAPU (Heavy Engineering)
Whole-time Director & Senior
(Engineering & Construction (Construction) Executive Vice President
Projects)
(IT & Technology Services)
ORGANISATION
STRUCTURE
"The company that we run has a
strong heritage of professionalism that places
the highest value on merit and integrity. In the
70th year of the existence of L&T, all the
directors on our board are conscious of our
responsibility in transforming the organisation
to make it truly world class, to ensure its
continued long term success and growth.“
- BOARD OF DIRECTORS
GLOBAL PRESENCE
1. The World's largest Tubular Reactor for a petrochemical plant
2. The world's largest Continuous Catalyst Reactor
3. The world's largest Fluid Catalytic Cracking Regenerator
4. The world's longest Product Splitter
5. The world's longest LPG pipeline
6. Asia's highest Viaduct
7. The first to offer electrical distribution products & systems engineered
for tropical environments
8. India's first indigenous Hydrocracker Reactor
9. India's first open sea jetty
10. India's biggest Offshore Oil Platform
11. India's longest Coal Conveyor
12. India's widest range of Low Tension Electrical Switchgear
TECHNOLOGY
In every sphere of L&T's operations, technology is
the key enabler, reinforcing its leadership position, and
sustaining its competitive strengths. While for some,
technology is a means to an end, for L&T, technology
represents endless possibilities.

 Engineering and Construction

 Manufacturing

 Technology Services
CORPORATE SOCIAL
RESPONSIBILITIES
 L&T believes that the true and full measure of growth, success
and progress lies beyond balance sheets or conventional
economic indices. It is best reflected in the difference that
business and industry make to the lives of people. Through its
social investments, L&T addresses the needs of communities
residing in the vicinity of its facilities, taking sustainable
initiatives in the areas of heath, education, environment
conservation, infrastructure and community development.
 The company proactively provides assistance in situations
such as natural calamities and assists victims of nature's fury
or social neglect. Many social initiatives are undertaken in
partnership with government agencies and NGOs.
STOCK PRICE
 The engineering giant Larsen and
Toubro is surprising all of us with
its tremendous forceful rise at
regular intervals. Such price-
volume break outs are of
significance. Sellers are raising
their prices at will and yet there
are enough buyers paying those
prices. So it means it is a good
'buy' even at these levels. If
market corrects, this stock
should correct the least. Smart
money would find this one a safe
place to invest. Larsen would
reach Rs 3000 by Mar 08 but now
we need to revise our targets
upwards. It had reached Rs 5000
by Oct 08.
NIFTY CHART
INDUSTRIAL VISIT
 RETURN ON CAPITAL EMPLOYED – 20.6%
 ECONOMIC VALUE ADDED – 51% to RS.834 crore
 TOTAL GROWTH RATE – 9% of GDP
 ORDER BOOK as on MARCH, 2008- RS.52,683 crore of
which 8,736 crore was contributed by international
business.
 SALES GROWTH – 41% amounting to RS. 25,187 crore
 PROFIT AFTER TAX – increased by 55%
 TOTAL INCOME INCRASE - 40% to Rs. 29,883 crore
RECENT PROFITS

Net income in the three months ended Dec. 31 climbed

40 percent to 4.82 billion rupees ($122 million), or 16.21
rupees a share, from 3.44 billion rupees, or 11.24 rupees, a
year earlier, Mumbai-based Larsen said in a statement today.
Six analysts in a Bloomberg News survey had a median
estimate of 4.46 billion rupees. Sales rose 55 percent to 63.8
billion rupees.
MERGERS AND ACQUISITIONS

 Tamco Corporate Holdings, Malaysia which has

manufacturing facilities in Malaysia, China,
Indonesia and Australia.
 Medium Voltage switchgear technology
 Strategic stakes in some of the key vendors for
ensuring availability of raw materials.
 Exit the Ready Mix Concrete business.
 transfer this business to Lafarge Aggregates
India Private Limited and divested the stake in
HPL Cogeneration.
RECESSION AFFECTS

 Sensex slips below 11K again; L&T

tumbles 11%
 Sensex sheds 320 pts; L&T down 10%.
 India shares drop 5.9 pct; Reliance, L&T
lead fall
 L&T Info to delay IPO on U.S. recession
OUTLOOK
 While macro economic fundamentals continue to inspire
confidence, the recent slowdown in the industrial sectors,
coupled with the spike in input costs, particularly oil, and
the credit squeeze, may impact the ability of the capital
goods sector to sustain the growth momentum in the near
term. Despite this, in view of the current pace of
hydrocarbon & infrastructure development in the country
and the neighboring regions as well as L&Ts entry into
manufacturing of super-critical boilers and super-critical
steam turbines & generators , the prospects for growth
appear promising. The Company’s businesses are geared to
harness the full potential of the emerging opportunities.
CONCLUSION

"It is our ability to

anticipate the future
and react accordingly
that will determine
our success".
- HENNING
HOLCK
THANK YOU