L&T flexes new age business, Middle Eastern muscle in Q1 results

Larsen&Toubro

India's largest engineering, procurement, and construction firm Larsen & Toubro (L&T) noted after its Q1 FY26 financial results that it has expanded its presence in "green" businesses across its infrastructure and renewables verticals. These include sectors such as renewable energy, semiconductors, data centres, among others.

L&T's chairman and managing director S.N. Subrahmanyan noted that the company is expecting to see meaningful revenues from its "new-age" businesses, besides its traditional revenue streams of buildings, roads and bridges, and its oil and gas business.

"Our new-age businesses like semiconductor, data centers, green energy and digital platforms have been successfully incubated in the current strategic plan and we expect these businesses to contribute meaningfully over the next 5 years. Besides enabling portfolio level diversification, these businesses reinforce our presence in technology driven sectors and to stay future ready," Subrahmanyan said in a statement.

The company, which got 52 percent of its Q1 orders from overseas markets, also entered Central Asia earlier in 2025, securing an order to build a 10 MW data centre at Tashkent in Uzbekistan, building on its gains in the Middle East market.

Since taking over from longtime chairman A.M. Naik in 2023, Subrahmanyan has steered L&T into expanding its play into greener businesses to diversify revenue streams, amid decreasing demand for oil and gas in the longer term, and continued geopolitical issues in the Middle East, affecting oil production and major infrastructure projects in the region, one of L&T's largest sources of orders.

The result has been a major focus on strategic initiatives, especially green hydrogen, with L&T forming a subsidiary to drive the production of green hydrogen electrolysers at its Hazira facility in Gujarat. Last year, the company carved out its renewable EPC business into a separate vertical for its power transmission and distribution business, in order to focus more on orders in the solar, wind, and other segments in renewable energy.

The company also entered the semiconductor space in 2024, having formulated an initial plan to spend $300 million to set up a "fabless" chipmaking firm, where L&T is slated to design and sell semiconductor chips, with production contracted elsewhere. However, it has also planned to set up a semiconductor fab with a $10 billion investment, and has targeted revenues of at least $1 billion from semiconductors by FY27.

In data centres too, L&T has expanded hiring and focus on its Cloudfiniti business, which is focused on data centres. Using own and newly acquired land parcels, the company plans on investing Rs 3,600 crore on three data centres with a capacity of 150 MW, nearly five times its current capacity. The data centres will be set up in Bengaluru, as well as at Mahape and Panvel in the Mumbai metropolitan area.