L&T sees prospective order pipeline of Rs 9 trillion in FY2024-25, says CFO

The prospective order pipeline for the energy sector is about Rs 2 trillion

The management of Larsen & Toubro (L&T) on July 24 said that there are opportunities worth Rs 9 trillion from project orders that the company will look to bid for in the ongoing financial year.

"As we look ahead, we see a very encouraging order prospect pipeline. And if you were to quantify that opportunity, it indicates a prospective pipeline of over Rs 9 trillion," L&T's Chief Financial Officer R Shankar Raman said.

Shankar Raman , while speaking at the company's post Q1FY25 earnings conference call, said that around 60 percent of the prospective order pipeline of Rs 9 trillion will come from projects in India.

The prospective order pipeline for the energy sector is about Rs 2 trillion rupees, he added.

"The thrust to infrastructure, the thrust to energy transition, that both the Indian government and the international governments have placed, augurs well and is supportive of the mix of the order pipeline that we are able to access presently," the CFO of the the engineering and infrastructure conglomerate said.

The consolidated order book of the L&T group stood at Rs 4,90,881 crore or Rs 4.9 trillion as on June 30, 2024, with international orders having a share of 38 percent, the company had said on July 24.

The order book of Rs 4,75,809 crore represents a growth of 19 percent over Rs 4,12,648 crore as on June 30, 2023 and Rs 3,63,448 crore as on June 30, 2022, L&T had said.

The CFO said that the slowdown in order inflows seen in Q1FY25 from the Indian market was mainly on account of the Lok Sabha elections and should not continue going forward.

In Q1FY25, L&T saw its order inflow rise to Rs 70,936 crore, a growth of 8 percent over the corresponding quarter of the previous year, due to strong ordering momentum from countries in the Middle East.

However, Shankar Raman warned that the ongoing Israel-Hamas war can disrupt order inflows. "My base case assessment is if things stay as they are today, this underlying tension will continue in the ecosystem," Shankar Raman said.

He added that despite the on-going geopolitical concerns, countries like Saudi Arabia have created an in-depth plan for 2030 and 2035.

Shankar Raman said that there exists opportunities worth $60 billion from infrastructure projects in the middle eastern countries, out of which L&T is targeting to win 5-10 percent.