I

BRACTs
Vishwakarma Institute of Management
(An ISO 9001-2008 Certified Institute)
(Approved by AICTE-New Delhi, Recognized by Government of Maharashtra and Permanently Affiliated to University of Pune)
MBA Programme Rated as MH-A by CRISIL
Recipient of the 19
th
Dewang Mehta B School Award for the Best B School with Academic Inputs in Marketing
Rewarded as Second Best Professional Institute in Urban Area Category by the University of Pune





1 Executive Summary
2 Project Objective
3 Introduction
4 Markets
5 Financial Information
6 Corporate Governance
7 CSR Activities
8 Conclusion
9 References





Project Report
On
Larsen & Toubro Limited (L&T)
For the subject,
Enterprise Analysis Desk Research (Course Code: 115)
Submitted by,
ABC,
MBA I, Div. A
Roll No


II

ACKNOWLEDGEMENT
I have great pleasure in submitting this project report on Larsen & Toubro Limited
(L&T). Before I get into the detail of this project I would like to add a few Heart full words of
thanks for the persons who have helped me directly or indirectly to achieve my goal.


1


INDEX


Sr. No. Topic Page No.
1 Executive Summary 2
2 Project Objective
3 Introduction
4 Markets
5 Financial Information
6 Corporate Governance
7 CSR Activities
8 Conclusion
9 References





2

1. Executive Summary



3

2. Project Objective



4

3. Introduction

3.1 Larsen & Toubro Limited (L&T)
Larsen & Toubro (L&T) is India's largest engineering and construction company. L&T,
along with its group companies, provides integrated design, engineering, procurement,
construction and project management services in various sectors. L&T has a global presence,
with operations across over 30 countries. The company operates in multiple segments -
Engineering and Construction (E&C), Electrical and Automation (E&A), Machinery and
Industrial Products (MIP) and others.

Engineering and Construction (E&C) includes:
i) Construction- Buildings, infrastructure etc.
ii) E&C Projects- Turn key projects, turbines, boilers, refineries
iii) Heavy industry- Heavy engineering & ship building.

Electrical and Automation (E&A) includes:
i) Electrical & automation products, metering systems, medical equipment, petrol
dispensing &pumps systems.

Machinery and Industrial Products (MIP) includes:
i) Construction & mining equipment
ii) Industrial products & machinery like valves, welding & cutting tools, etc.

Others: Engineering Services










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3.2 Major subsidiaries:

L&T InfoTech:
i) Provides IT/ITes and consultancy solutions to sectors such as Banking, Financial
Services and Insurance (BFSI), Technology, Energy, Petrochemicals etc.
ii) Has a global presence as majority of its clients are MNCs.
L&T Finance Holdings:
i) Provides financing solutions to Infrastructure players, retail players, corporates
etc. through three subsidiaries.
ii) Offers additional services for asset management and investment management.
L&T Infrastructure Development Projects Ltd:
i) Handles all development projects, across sectors like Roads & Highways, Ports and
Metro Rail.
ii) Executes projects in railways, power transmission and public utilities, which are
executed via SPVs.




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L&T FZE:
i) International arm of L&T, which handles electrical automation, telecommunication
and instrumentation projects.
ii) Provides power management, telecommunication and other industrial control systems
to several industries.

























7

4. Markets
Key projects during 2013-14:
I) Domestic:
i) Design. Engineering, Manufacture, supply, election and commissioning of
two co a I-fired thermal units of 660 MW each with supercritical
parameters at Chhabra in Baran District in Rajasthan.
(Project cost in Rs. Million: 56,890).

ii) A) Construction of residential towers and commercial development
across India.
B) Execution of-APDRF (part B) project on Tmkey basis at.Amritsar,
Jalandhar and Ludhian city.
C) Construction of Solar PV plants in Rajasthan and Tuticorin. Tamil
Nadu.
D) Infrastructure and Metallurgical and Material Handiling Business
(Project cost in Rs. Million: 37,000).

iii) A) Construction of residential apartments in southern part of the
country
B) Construction of 400 kV and 200 kV transmission lines at various
location across India.
C) Construction of water supply waste water and sewerage scheme
across the country.
D) Various ongoing projects across various other Business Units.
(Project cost in Rs. Million: 20,040).

iv) EPC order- construction of double track corridor from Rewari in Haryana
to Iqbalgarh in Gujarat via Rajasthan, spanning three states.
(Project cost in Rs. Million: 66,995).



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v) A) Construction of office buildings at Bangalore and Ahmedabad
from esteemed customers.
B) Turnkey EPC of a solar photovoltaic power plant in Tamil Nadu.
C) Design, detail engineering, testing and commissioning of 25 kV
AC traction. 33 kV auxiliary sub stations, associated cabling and SCADA
systems for underground corridor of line-S of the Delhi MRTS project-
phase 3for Delhi Metro Rail Corporation Ltd.
D) Supply, installation. Testing and commissioning of E&M fire
detection and fire suppression system of elevated stations of Delhi MRTS
Projects- Phase 3.
(Project cost in Rs. Million: 20,020).

vi) A) Construction of residential tower, a cement plant and a factory at
various locations across India, including additional orders from operating
projects.
B) Construction of an elevated viaduct, elevated stations including
architectural finishing work of stations and connecting the viaduct and
ramp to the depot on Alwaye-Petta line of the project for Kochi MRP.
C) Designing and construction of2X25 kV electrification, signaling,
telecommunication and associated works for a double tract railway line
between New Karwandiya to Durgauti section of the eastern corridor.
D) EPC order-Water supply distribution system for 97 villages at
Tehsil Nadnu in Rajasthan.
E) Operating projects under Power Transmission and Distribution
Business
(Project cost in Rs. Million: 25,420).








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II) International:
i) Development of the prestigious Midfield Terminal complex for Abu
Dhabi Airports Company PJSC, UAE
ii) Manufacture and supply 11 kV Vacuum Circuit Breakers fVCBs over a
two-year period to distribution stations across Qatar.



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5. Financial Information
5.1 Weak execution impacts revenue growth: During Q1 2013-14, the company's order
inflows grew by 29 per cent y-o-y, led by orders from the real estate and railways segment.
However, the company's revenues grew by a tepid 5 per cent y-o-y on account of weak
execution. Healthy order inflows coupled with weak execution led to an 8 per cent growth in the
company's order book.
Order Inflows (Rs. billion) :

Order book to turnover:



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5.2 Order book driven by infrastructure projects: The Companys order book remains
well-diversified among sectors, such as power, gas, infrastructure and process engineering.
Within infrastructure, orders are further diversified into sectors like ports, roads, bridges, power,
hospitals, real estate etc. In Q1 2013-14, infrastructure sector accounted for 67 per cent of the
order book. Additionally, the company has a fair mix of government projects (35%), private
sector projects (53%) and in-house development projects (12%). The share of the power segment
has declined significantly from 30 per cent in 2009-10 to 10 per cent in Q1 2013-14. Also, the
share of the oil and gas segment has dropped significantly by 9 per cent to 6 per cent in the same
period. L & T's order book consists of domestic orders to the tune of 88 per cent. This
diversification in orders protects the company from any adverse impact on its overall
performance owing to a slowdown in any geography/ segment.
Trends in order book mix:






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5.3 Financial performance
Larsen & Toubro Ltd.

Financial parameters

Unit

Standalone

Consolidated

2010-11

2011-12

2012-13

2010-11

2011-12

2012-13

Operating Income

Rs. Million 438,259

533,604

611,667

519,947

644286

746,585

Net worth

Rs. Million 217,201

250,590

283,757

143,043

186,925

263,855

Net profit

Rs. Million 39,572

44 562

49,074

45405

47,368

52,375

Operating margin

Per cent

12.7

12.1

10.6

16.6

16.4

16.4

Net Margin

Per cent

9.0

34

3.0

3.7

7.4

7.1

Return on capital employed Per cent

24.2

22.0

21.4

18.9

16.2

15.1

Debt equity ratio

Times

0.3

04

0.3

2.6

2.3

2.5

Net cash accruals to debt

Times

0.5

04

0.5

0.1

0.1

0.1

Interest coverage

Times

9.1

10.0

7.4

5.2

4.0

2.9

Assets turnover ratio

Times

5.5

5.7

5.6

4.4

4.1

2.9

Current Ratio

Times

1.2

1.3

1.4

1.6

1.6

1.7

Creditors

Days

232

216

209

266

216

227

Debtors

Days

104

129

136

104

116

113

Source: CRISIL Research






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5.4 Q1 2012-13: Muted revenue growth, operating margins decline
Larsen & Toubro Ltd.
Financial Standalone
Apr Jun
parameters Unit Apr Jun
FY14 FY13 y-o-y Growth
Net sales Rs. Million 125,551 119,554 5%
Operating profit Rs. Million 10,715 10,870 -1%
Net profit Rs. Million 7,560 8,637 -12%
Operating margin Per cent 8.5 9.1 -
Net Margin Per cent 6.0 7.2 -
Source:CRISIL Research

5.5 Stock Index:
Stock Index
Exchange (NSE)
Date : 24/10/13
Open (Rs.) : 945.75
High (Rs.) : 973.50
Low (Rs.) : 943.25
Traded Qty. : 3,648,616
Current : 965.65
%Change : 1.72
Market Cap.(Rs. Billion) : 893.90





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Stock Index
Exchange (BSE)
Date : 24/10/13
Open (Rs.) : 947.00
High (Rs.) : 972.25
Low (Rs.) : 944.00
Traded Qty. : 466,305
Current : 964.60
%Change : 1.83
Market Cap.(Rs. Billion) : 892.93


Larsen & Toubro Limited
As of Oct 24, 2013
Exchange Current
Prev
Close
Today's
High
Today's
Low
52 Week
High
52 Week
Low
Volume
BSE1 964.60 947.30 972.25 944.00 1152.07 678.10 466305
NSE2 965.65 949.35 973.50 943.25 1152.40 677.15 3648616







15

Nifty 5years range:

INR


Sensex 5years range :

INR






16

6. Corporate Governance

6.1 BOARD OF DIRECTORS:

A.M. NAIK

Group Executive Chairman
K. VENKATARAMANAN

Chief Executive Officer & Managing Director

M. V. KOTWAL

Whole-time Director & President
(Heavy Engineering)

S. N. SUBRAHMANYAN

Whole-time Director & Sr. EVP
(Infrastructure & Construction)



17

R. SHANKAR RAMAN

Whole-time Director & Chief Financial Officer

SHAILENDRA ROY

Whole-time Director & Sr. EVP
(Corporate Affairs & Power)


6.2 NON-EXECUTIVE DIRECTORS

S. Rajgopal
S.N. Talwar
M.M. Chitale
N. Mohan Raj
Subodh Bhargava
A.K. Jain
M.Damodaran
Vikram Singh Mehta
Sushobhan Sarker

6.3 AUDIT COMMITTEE
Terms of reference:
i) The Audit Committee oversees the Company's financial reporting process and
disclosure of its financial information, to recommend the appointment of Statutory
Auditors and fixation of their remuneration, to review and discuss with the Auditors
about internal control systems, the scope of audit including the observations of the


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Auditors, adequacy of the internal audit system, major accounting policies, practices
and entries, compliance with accounting standards and Listing Agreements entered
into with the Stock Exchanges and other legal requirements concerning financial
statements and related party transactions, if any, to review the Company's financial
and risk management policies and discuss with the Internal Auditors any significant
findings for follow-up thereon, to review the Quarterly, Half-yearly and Annual
financial statements before they are submitted to the Board of Directors.
ii) The Committee also meets the operating management personnel and reviews the
operations, new initiatives and performance of the business units. Minutes of the
Audit Committee Meetings are circulated to the Members of the Board, discussed and
taken note of. The Audit Committee of the Board of Directors was formed in 1986
and comprises four Non-Executive Directors.
iii) The Chief Financial Officer and Chief Internal Auditor are permanent invitees. The
Company Secretary is the Secretary of the Committee.

6.4 NOMINATION & COMPENSATION COMMITTEE
Terms of reference:
To review, assess and recommend the appointment of Executive and Non-Executive
Directors and, to review their remuneration package, to recommend compensation to the Non-
Executive Directors in accordance with the provisions of the Companies Act, 1956, to consider
and recommend Employee Stock Option Schemes and to administer and superintend the same.
Composition:
The committee comprises 3 Non-Executive Directors and Chairman & Managing
Director.

6.5 SHAREHOLDERS' GRIEVANCE COMMITTEE
Terms of reference:
To look into the investors complaints, if any, and to redress the same
expeditiously. Besides, the committee approves allotment, transfer and transmission of


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Shares, Debentures and any other securities and issue of duplicate certificates and new
certificates on split/consolidation/renewal etc. as may be referred to it by the Share
Transfer Committee.
Composition:
The Shareholders' Grievance Committee presently comprises 2 Executive Directors and a
Non-Executive Director.

6.6 MEANS OF COMMUNICATION
i) Quarterly and Annual Results are published in prominent daily newspapers viz.,
The Financial Express, The Hindu Business Line & Loksatta. The said results are
made available on the Company's website, www.larsentoubro.com
ii) Official news releases, presentations, etc. made to institutional investors and the
shareholding pattern of the Company, on a quarterly basis are displayed on the
Company's website, www.larsentoubro.com
iii) Management's Discussion & Analysis forms part of the Annual Report, which is
mailed to the shareholders of the Company.














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7. CSR Activities
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 health, 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.
HEALTH
L&T's participates in building a healthy community through continuing initiatives
in several areas of healthcare, with a focus on mother & child care and HIV/AIDS
awareness. All L&T locations, including construction sites, have in-house AIDS
awareness programs. Five additional mother & child care centers were set up in 2006-07.
In partnership with local NGOs, these centers benefit children of commercial sex
workers, street children and tribal communities.
Through health care centers and regular family camps L&T organizes health
checkups, provides gynecology and laboratory facilities, carries out free cataract
surgeries and intra ocular lens implants, and helps maintain health data for children.
Supply of equipment and aid for orphanages and physically challenged children, periodic
counseling to combat rampant alcoholism, awareness camps on childcare, reproductive
health, sanitation, dental check-up, provision for safe drinking water, cancer awareness
etc. are other healthcare activities that L&T supports.

EDUCATION
L&T's diverse and sustained programs in education provide underprivileged
children with learning opportunities through supply of educational materials, teaching
aids, recreational tools and up scaling school infrastructure. L&T also enriches children's


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lives through programs like summer camps, math coaching, providing facilities like
science laboratories, scholarship to deserving students, etc.
The vocational training institutes of the Larsen and Toubro Public Charitable
Trust provide local communities with skill-based training in Formwork, Masonry, Agro
Mechanics, Electricals, Fabrication, Welding and Housekeeping. Various diploma
courses are also conducted by L&T Institute of Technology for the children of
employees. L&T has developed training modules in local languages in six centers across
India for imparting skills sets in construction. L&T Training Centers provide courses for
improving the standards of electrical engineering practices and for upgrading knowledge
of maintenance, repair and welding.

ENVIRONMENT
Global warming: at L&T, we have always been conscious of the need to maintain
harmony with the environment. We continuously seek newer environment-friendly
approaches in all our operations energy conservation, exploring alternative sources like
wind and solar energy, waste water reduction, etc.
The Zero Discharge approach of the Powai Campus saves over 350,000 liters
water every day through water treatment and recycling. More than 13,500 trees have been
planted in different L&T campuses in the last year, and an additional 4,000 saplings were
distributed among local communities.

RESPONSE TO NATURAL CALAMITIES
L&T and its employees have provided relief measures during natural calamities
like earthquake and floods. L&T has assisted in disaster relief through employee and
corporate donations, employee volunteering, supply of construction material, medical and
food supplies. After the floods in Surat (Gujarat-India), L&T played a major role in road-
clearing operations, organizing medical camps, and supply of food, water, clothes and
other relief materials.

EMPLOYEE VOLUNTEERING
L&T encourages employees to volunteer for CSR activities, resulting in a self-
driven approach while retaining consistency. L&T employees and the ladies clubs formed


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by their families at different locations, serve their communities by investing personal
resources and time.
From taking initiatives in building the next generation of productive citizens,
empowering women, paying regular visits to old age homes and orphanages, to
organizing blood donation camps, our employees have always believed in truly making a
difference to the world in which they live.




























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8. Conclusion

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.

More than 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 global
footprint, with offices and manufacturing facilities in multiple countries.

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.

In response to changing market dynamics, L&T has gone through a phased process of
redefining its organisation model to facilitate growth through greater levels of
empowerment. The new structure is built around multiple businesses that serve the needs of
different industries.







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AWARDS & RECOGNITION
The NDTV Profit Business Leadership Award Affirming L&T's stature in
building infrastructure, the Company was honoured with NDTV Profits Business
Leadership Award.
Ranked 3rd in the Greenex : L&T was ranked third in Greenex - a first-of-its-kind Green
Index constituted by Bombay Stock Exchange that assesses the carbon performance of
companies drawn from the top 100 companies listed by BSE.
Among the top 5 thought Leader Brands in India: L&T stood among the top 5 in a
Thought Leaders in India index published by a London based communications agency.
Among the top 10 in SL&P ESG India : L&T was the only company from the
engineering segment to be ranked among the top 10 in Standard L& Poors (SL&P) ESG
India index of companies in terms of Environment, Social and Governance performance.
Among the top 5 in RepuTex ESG ratings: L&Ts sustainability practices and
disclosures are ranked amongst the top in Asia in the Environment, Social L& Governance
(ESG) 2011 ratings by RepuTex, Hong Kong - a leading ESG,carbon advisory and
independent research organisation. L&T is also the only Indian company listed among the
top 5 in Asia in the Industrial segment rating.
Laurels for excellence in quality systems from FICCI: Platinum Awards for
Excellence in Quality Systems from FICCI were won by L&T Heavy Engineering, Powai
campus - Mumbai and by L&T Komatsu, Bangalore Works.
The international 'Be Inspired Award' for L&T-SL&L: L&T-Sargent L& Lundy
(L&T-SL&L) honored with the prestigious 'Be Inspired Award' from Bentley Systems Inc. in
Amsterdam.
CII-EXIM Bank Business Excellence Award conferred on L&T AIL for the third year
in a row: L&T - Audco India Ltd. (AIL) won this award in recognition of business
excellence initiatives under the MIP IC operational excellence programme to enhance the
competitive edge and the quality of AIL's products and services.
Institutional Investor magazine honors team L&T with high rankings: L&T ranked
'Second' in India and Fifth' in Asia in the All Asia (excluding Japan) Investor Relations (IR)
Perception Study conducted by the prestigious Institutional Investor magazine. The
Company, its leadership team and senior executives also scored high in other rankings.


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11 ABCI awards for L&T: L&Ts communications bagged a total of 11 awards at
Association of Business Communicators of India (ABCI) Awards. The tally includes awards
secured across the spectrum of In-house Magazines, Brochures, Calendars, Photographs and
Sustainability Report. The number of awards received was among the highest secured by any
company, qualifying L&T for the coveted 'Champion of Champions Award'
Among the top 10 Best Companies to Work For, India: L&T ranked among the top
10 in a Best Companies to Work For listing published by Business Today, India.
The ICC Corporate Governance and Sustainability Vision Award 2012: The Indian
Chamber of Commerce (ICC) awarded L&T with the Corporate Governance and
Sustainability Vision Award 2012 in the Sustainability Reporting category.
ICSI The Golden Peacock Global Award: L&T bagged the Golden Peacock Global
Award for Excellence in Corporate Governance - 2011, constituted by the Institute of
Directors (IoD) and the World Council for Corporate Governance.
Heavy Engineering wins the National Award for export excellence: Heavy
Engineering business won the National Award for export excellence, presented by the
Engineering Export Promotion Council of India (EEPC).













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IN THE NEWS
19 Oct 2013: L&T in Top 10 - Business worlds Real 500 Rankings
26 Sep 2013: L&T: Corporate Citizen of 2013 - The Economic Times
25 Sep 2013: L&T Scores High in Global 500 Climate Change Report 2013
20 Sep 2013: L&T Technology Services - Leader In Engineering Services: Zinnov
Study
22 Aug 2013: L&T among Indias Top 5 Most Respected Companies - Businessworld
10 Aug 2013: Capital Goods Skill Council Launched
31 Jul 2013: L&T in Top 10 Best Indian Brands - Interbrand & The Economic Times
Survey
18 Jul 2013: L&T in Top 5 Best Companies to Work For - Business Today Survey
12 Jul 2013: L&T is Indias Most Admired Company in E&C Sector - Fortune India
Survey
05 Jul 2013: National Good Design Award for L&Ts Solar Lantern
05 Jul 2013: L&T Integrates Valves Operations Under Single Entity - L&T Valves
Limited
15 May 2013: L&T Ranks High In International Emission Disclosure Rankings
04 May 2013: Mr. A.M. Naik Honoured By Gujarat CM on States Formation Day
22 Apr 2013: L&T - One of Indias Most Attractive Employers - Randstad Survey
19 Apr 2013: ONGCs Jack-Up Rig Sagar Uday Flagged Off From L&T Yard In Oman
09 Apr 2013: L&T bags NDTV Profit Business Leadership Award
16 Mar 2013: Mr. R. Shankar Raman is CFO of the Year - CNBC TV 18
23 Feb 2013: L&T Wins ICC Corporate Governance & Sustainability Vision Award
22 Feb 2013: L&T Conferred Caring Company Award By World CSR Congress
13 Feb 2013: L&T Power Wins Golden Peacock National Quality Award
23 Jan 2013: L&T Ranks Among Top 10 In Carbon Disclosure Leadership Index
19 Jan 2013: Mr. A.M. Naik Awarded Doctorate from Gujarat Technological
University
16 Jan 2013: L&T Heavy Engineering Bags CIIITC Sustainability Award





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CORPORATE ADS








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9. References