L&T Executives Declare ₹35,000 Crore Saudi Aramco Order as Biggest Ever.

Senior executives from Larsen & Toubro (L&T) addressed recent reports on Tuesday regarding a new order from Saudi Aramco, emphasizing that the order is already included in their existing order book.

“This Rs. 35,000 crore order was previously reported to the exchanges in FY24. The recent ceremony was a formal handover of the work to contractors,” explained Subramanian Sarma, L&T's Whole-Time Director and President (Energy), highlighting it as the company's largest-ever order win.

On Tuesday, L&T's stock closed at Rs. 3,624.25, up 2.74%, largely driven by expectations of a fresh order win. Sarma clarified that the order contributes to L&T’s reported outstanding order book of Rs. 4.75 trillion as of March this year.

Looking ahead, Sarma expressed optimism about future orders from West Asia. “We have been pursuing several large projects in both upstream and downstream sectors. Our pipeline for prospects remains strong,” he stated. Despite FY24 being a robust year for Middle East orders, Sarma anticipates positive year-on-year growth in West Asia’s order book for the current financial year.

Saudi Arabia, particularly Saudi Aramco, has significantly contributed to L&T’s order book, with 38% of its Rs 3.02 trillion order inflow and 35% of its Rs 4.75 trillion order book originating from West Asia as of March. While acknowledging market skepticism due to Saudi Arabia's cautious investment stance, Sarma reassured, “They continue to invest, and we see no significant changes in sentiment.”

Discussing other prospects, Sarma highlighted potential orders in the renewable energy segment, noting a promising outlook internationally. He also mentioned L&T’s involvement in green hydrogen initiatives and its joint venture with Indian Oil Corporation and ReNew for upcoming projects, including ventures at Kandla port.

“We are actively participating in government tenders, and we expect positive developments in the coming months,” Sarma concluded.

BS