Year On Year Growth

The construction business currently stands at around Rs.24,000 crore. This represents 52 per cent of the total revenue of the company. Achieving a turnover of Rs.50,000 crore in four years could be a daunting task', Mr. Subrahmanyan said. Nevertheless, he said that it is a part of the deep-rooted vision envisioned by Mr. Rangaswami. To a question, he said all the four verticals within its construction space buildings/factories, infrastructure, electrical and minerals/metals/water offered huge potential. He envisaged the growth to come from all these four verticals.In the area of electrical, L&T, he said, was present across the Middle East. The company was now looking at Southern part of Africa. In the largely fragmented minerals/metals space, L&T had built a unique EDB' (engineering, design and building) business model. On the challenges facing the company in doubling the construction revenue, Mr. Subrahmanyan conceded that the single most impediment is HR (human resources). The construction wing of L&T inducted close to 2,000 people every year. How to make them at least five years experienced when they take up the job? It is a huge challenge in training them, Mr. Rangaswami said. In this context, both felt L&T needed to do a lot to retain the labourers trained through its centralised skilled training institute. Larsen & Toubro reported Gross Revenue of Rs 9578 crore for the quarter ended June 30, 2011, registering 21% y-o-y growth, on the back of a healthy order book and superior execution of jobs. In the current scenario of moderating growth momentum in the economy, the Company garnered fresh orders of Rs 16190 crore, taking its Order Book to Rs 136172 crore as at June 30, 2011. The major orders during the quarter came from Buildings & Factories, Infrastructure, Power Generation, Transmission & Distribution, Minerals & Metals and Hydrocarbon sectors. The Companys Profit after Tax (PAT) for the quarter stood at Rs 746 crore recording an increase of 12% over the corresponding quarter of the previous year. Significant growth in revenues was registered in 2010-11. Notable projects completed include: y y y y The Delhi International Airport Terminal 3 - well before the Commonwealth Games The completion in a record 182 days of the Mahatma Mandir at Gandhinagar in Gujarat which hosted the high-profile exposition - Vibrant Gujarat 2011 Refurbishment of the Wankhede Stadium which hosted the prestigious Cricket World Cup finals 2011. The completion of these projects under challenging time schedules underlines L&T's superior capabilities in project management and project execution and in successfully handling large design & build projects.

Different Segment-wise Growth

Engineering & Construction (E&C) Segment The E&C Segment achieved Gross Revenue of Rs 8018 crore for the quarter ended June 30, 2011 registering a y-o-y growth of 23%. Execution of several jobs on hand is on schedule. Despite the sluggish pace of investments seen in the various key sectors of the economy, the segment succeeded in bagging orders totaling to Rs 14416 crore during the quarter. The Order Book of the Segment stood at ` 133739 crore as at June 30, 2011. Execution efficiencies and tight cost monitoring strategies have enabled the segment achieve an Operating Margin of 11.9% during the quarter ended June 30, 2011. Certain high value jobs are yet to reach the threshold level for margin recognition and hence, could not contribute to the operating margin during the quarter. Electrical & Electronics (E&E) Segment Sluggish growth in exports and low demand from domestic market constrained the revenue growth of the segment during the quarter. Gross Revenue was Rs 695 crore for the quarter ended d June 30, 2011. The Segment margin at 10.8% during the quarter was under pressure with steep increase in input prices, heightened competitive pressures restricting the avenues for price increase and lower volumes. Machinery & Industrial Products (MIP) Segment The Segment recorded Gross Revenue of Rs 666 crore during the quarter ended June 30, 2011, registering a growth of 25% over the corresponding quarter of the previous year. The Segment earned Operating Margin of 20.1% during the quarter even on a higher sales volume.

Outlook
Global economic concerns, spiraling inflation and hardening interest rates are likely to impact the growth prospects in the economy. Indian economy, however, has withstood such cycles in the past and emerged resilient with its strong fundamentals. Speedy implementation of various initiatives by the Government for industrial and infrastructure development holds the key to an accelerated growth momentum. On the global front, the GCC countries of the Middle East hold opportunities in the areas of Hydrocarbon, Power Transmission & Distribution, and infrastructure development. With expanded capacities, new organisation structure and presence in diverse sectors, the Company is in a good position to harness the available opportunities. The large order book of the Company, besides providing good revenue visibility, underscores its leadership position. The Company is confident of sustaining the growth momentum in the medium term with its proven track record, strong order book and execution excellence.