ADARSH INSTITUTE OF

MANAGEMENT
MARGAO – GOA.

Topic:

Done by:
Prajot Morajkar
Roll no: 16
Company profile

Overview:
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. 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 overseas manufacturing
footprint, with facilities in China and the Gulf region. 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.

Operating Divisions:
 Engineering & Construction Projects (E&C).
 Heavy Engineering (HED).
 Construction.
 Power.
 Electrical & Electronics (EBG).
 Machinery & Industrial Products (MIPD).
 IT & Technology Services.
 Financial Services.
 Railway Projects.

History:
L&T was founded in Bombay (Mumbai) in 1938 by two Danish engineers, Henning Holck-
Larsen and Soren Kristian Toubro. Both of them were strongly committed to developing
India's engineering capabilities to meet the demands of industry.
The evolution of L&T into the country's largest engineering and construction organization
among the most remarkable success stories in Indian industry.

Henning Holck-Larsen Soren Kristian Toubro

In the Beginning they imported machinery from Europe; L&T rapidly took on engineering and
construction assignments of increasing sophistication. Today, the company sets global
engineering benchmarks in terms of scale and complexity.

Early days:
Henning Holck-Larsen and Soren Kristian Toubro in their school life would not have dreamt, as
they were learning about India in history classes; that one day they would, create history in the
same land.

In 1938, Both the friends decided to give up the comforts of working in Europe, and started
their own operation in India. All they had was a dream. And the courage to dare. The first
office that they have started in Mumbai (Bombay) was so small that only one of the partners
could use the office at a time. In the early years, they represented Danish manufacturers of
dairy equipment for a modest retainer. But with the start of the Second World War in 1939,
imports were restricted, compelling them to start a small work-shop to undertake jobs and
provide service facilities.
Germany's invasion of Denmark in 1940 stopped supplies of Danish products. This crisis
forced the partners to stand on their own feet and innovate. They started manufacturing dairy
equipment indigenously. These products proved to be a success, and L&T came to be
recognised as a reliable fabricator with high standards. The war-time need to repair and refit
ships; that has offered L&T an opportunity, and led to the formation of a new company, ‘‘Hilda
Ltd’’ to handle these operations. L&T also started two repair and fabrication shops by this time
Company had begun to expand. As there were, the sudden internment of German engineers
who were to put up a soda ash plant for the Tatas, gave L&T a chance to enter the field of
installation - an area where their capability became well respected.

The Journey
In 1944, ECC was incorporated. Around then, L&T decided to build a portfolio of foreign
collaborations. By 1945, the Company represented British manufacturers of equipment used to
manufacture products such as hydrogenated oils, biscuits, soaps and glass.

In 1945, L&T signed an agreement with Caterpillar Tractor Company, USA, for marketing
earthmoving equipment. At the end of the war, large numbers of war-surplus Caterpillar
equipment were available at attractive prices, but the finances required were beyond the
capacity of the partners. This encourages them to raise additional equity capital, and on 7th
February 1946, Larsen & Toubro Private Limited was born.

Independence and the subsequent demand for technology and expertise offered L&T the
opportunity to consolidate and expand. Offices were set up in Kolkata (Calcutta), Chennai
(Madras) and New Delhi. In 1948, fifty-five acres of undeveloped marsh and jungle was
acquired in Powai. Today, Powai stands as a tribute to the vision of the men who transformed
this uninhabitable swamp into a manufacturing landmark.
Public limited company
In December 1950, L&T became a Public Company with a paid-up capital of Rs.2 million.
The sales turnover in that year was Rs.10.9 million. Prestigious orders executed by the
Company during this period included the Amul Dairy at Anand and Blast Furnaces at
Rourkela Steel Plant. With the successful completion of these jobs, L&T emerged as the
largest erection contractor in the country.

In 1956, a major part of the company's Bombay office moved to ICI House in Ballard Estate.
A decade later this imposing grey-stone building was purchased by L&T, and renamed as
L&T House - it’s Corporate Office.

The sixties saw a significant change at L&T - S. K. Toubro retired from active management in
1962. The sixties were also a decade of rapid growth for the company, and witnessed the
formation of many new ventures: UTMAL (set up in 1960), Audco India Limited (1961),
Eutectic Welding Alloys (1962) and TENGL (1963).

Expanding horizons
By 1964, L&T had widened its capabilities to include some of the best technologies in the
world. In the decade that followed, the company grew rapidly, and by 1973 had become one
of the Top-25 Indian companies.

In 1976, Holck-Larsen was awarded the Magsaysay Award for International Understanding in
recognition of his contribution to India's industrial development. He retired as Chairman in
1978. In the decades that followed, the company grew into an engineering major under the
guidance of leaders like N. M. Desai, U. V. Rao, S. D. Kulkarni and A. M. Naik.

Today, L&T is one of India's biggest and best known industrial organisations with a
reputation for technological excellence, high quality of products and services, and strong
customer orientation. It is also taking steps to grow its international presence.

Subsidiaries & Associates

L&T group has a number of subsidiaries & associates carrying out its business all over the
world.

 L&T FINANCE LIMITED.

 L&T INTERNATIONAL FZE.
 L&T URBAN INFRASTRUCTURE LIMITED.
 L&T INFRASTRUCTURE FINANCE COMPANY LIMITED.
 L&T CAPITAL COMPANY LIMITED (LTCCL).
Awards & Recognitions
Major awards won by L&T in 2010:

 Double Honours for L&T at NDTV Profit Awards

It was a special evening for L&T at the NDTV Profit Business Leadership Awards
on September 1, 2010. Mr. A.M. Naik, Chairman & Managing Director, L&T,
received a Special Award for Business Leader of the Year - Building India. The
Award was presented to Mr. Naik by Union Finance Minister, Mr. Pranab
Mukherjee. The other honour that came L&T's way was the Leadership Award for
Excellence in Infrastructure. This was the fourth occasion when L&T has emerged
the winner in the infrastructure category, affirming the Company's leadership
position in the industry.
 L&T wins Social Development Award from Bombay Chamber of Commerce
L&T's Corporate Social Initiatives won further laurels with an award from the
Bombay Chamber of Commerce and Industry (BCCI). The Social Development
Award - one of BCCI's prestigious annual Civic Awards - recognises and rewards
best practices among corporate with a view to securing wider acceptance for such
practices across the industry. (June 10, 2010)
 L&T wins Corporate Wellness Award from Confederation of Indian Industry
The Confederation of Indian Industry (CII) honoured L&T with its prestigious
Corporate Wellness Award for ‘Best Health Practices’ in the manufacturing sector.
The award was presented at the valedictory session of CII’s National Conference &
Annual Session, held in New Delhi, on May 12, 2010.
 L&T bags Business world-FICCI Corporate Social Responsibility Award
Appreciating the extensive effort put in by L&T in transforming lives through its
Corporate Social Responsibility initiatives, well-known business magazine, Business
world, and the Federation of Indian Chambers of Commerce and Industry (FICCI)
have conferred on it the coveted Business world-FICCI-SEDF Corporate Social
Responsibility Award. (May 11, 2010)
 L&T is Business Standard ‘Company of the Year’
L&T bagged the Company of the Year award from the leading business daily,
Business Standard. Union Home Minister, Mr. P. Chidambaram, presented the award
to Mr. A.M. Naik, Chairman & Managing Director, L&T, at a glittering function in
Mumbai on March 30, 2010.
 Mr. A.M. Naik Honoured with OceanTEX Business Leader of the Year Award
The Mumbai based CHEMTECH Foundation has awarded L&T's Chairman &
Managing Director, Mr. A.M. Naik, its prestigious ‘OceanTEX Business Leader of
the Year’ Award. (March 30, 2010)
 L&T′s Electrical Standard Products wins IMC Ramkrishna Bajaj National
Quality Award
The Electrical Standard Products (ESP) business unit of Electrical & Automation
Operating Company of L&T, won the coveted IMC Ramkrishna Bajaj National
Quality Award 2009. (March 19, 2010).
 L&T′s in-house magazine, The L&T-ite, bags ABCI ‘Magazine of the Year
 Award’
L&T’s employee magazine, The L&T-ite, bagged the ‘Magazine of the Year Award’
from the Association of Business Communicators of India at the 49th Annual
Awards Contest. L&T also bagged a tally of 10 other awards at the competition. This
is the highest number of awards won by any of the 86 companies from around the
country that participated in the annual contest. (March 19, 2010).
 Mr. A.M. Naik Wins ‘CEO of the Year’ Award from ISTD, Bangalore
The New Delhi based Indian Society for Training & Development (ISTD), conferred
its prestigious ‘CEO of the Year’ Award on Mr. A.M. Naik, L&T′s CMD. (February
14, 2010).
 L&T-Komatsu bags Energy Efficiency & Conservation Award
L&T-Komatsu (LTK) has bagged the prestigious award for being ‘The Most
Innovative Company in Energy Efficiency & Conservation’ from the Bangalore
Chamber of Industry and Commerce (BCIC). This award recognises LTK’s
commitment to energy conservation in line with the EHS management system
followed by the organisation. (February 11, 2010).

Management Profile
The company has a strong heritage of professionalism that places the highest value on merit
and integrity. In the 70th year of the existence of L&T, all the directors on our board are
conscious of our responsibility in transforming the organisation to make it truly world class,
to ensure its continued long term success and growth.

 A. M. Naik

Chairman & Managing Director

 J. P. Nayak
 Whole-time Director & President
(Machinery & Industrial Products)

 Y. M. Deosthalee

Whole-time Director & Chief Financial Officer

 K. Venkataramanan

Whole-time Director & President

(Engineering & Construction Projects)

View Profile

 R. N. Mukhija

Whole-time Director & President

(Electrical & Electronics)

 K. V. Rangaswami
 Whole-time Director & President
(Construction)

 V. K. Magapu

Whole-time Director & Senior Executive Vice President

(IT & Technology Services)

 M. V. Kotwal

Whole-time Director & Senior Executive Vice President

(Heavy Engineering)

NON-EXECUTIVE DIRECTORS

 S. Rajgopal
 S. N. Talwar
 M. M. Chitale
 Thomas Mathew T.
 N. Mohan Raj
 Subodh Bhargava
 Mrs. Bhagyam Ramani
 A.K. Jain
 Jagjeet S. Bindra
Business Structure

Segment Analysis
The company’s business can be primarily divided into the following segments:

Engineering & Construction – Projects

(EPC): L&T’s engineering and construction track record consists of successful implementation
of turnkey projects in major core and infrastructure sectors of the Indian industry. L&T has
integrated its strengths in process technology, basic and detailed engineering, equipment
fabrication, procurement, project management, erection and construction and commissioning,
to offer single point responsibility under stringent delivery schedules. It is the only Indian EPC
company prequalified for executing large, process-intensive projects for oil and gas, refinery,
petrochemical and fertiliser sectors.

Heavy Engineering: L&T is acknowledged as one of the top five fabrication companies in the
world, with engineering and manufacturing capabilities that are among the most sought after in
industry. Operating at the higher end of the technological spectrum, L&T has led the way in
introducing new processes, products and materials in manufacturing. It has the logistics
capabilities of fabricating and supplying over-dimensional equipment to tight delivery
schedules.

Shipbuilding: Shipbuilding represents a new thrust for L&T in the high technology
manufacturing space and is in line with its strategic growth objectives. L&T is developing a
shipyard capable of constructing vessels of up to 150 metres in length and displacement of
20000 tonnes at its heavy engineering complex at Hazira near Surat on India’s west coast. The
focus will be on construction of commercial vessels, warships for the navy and the coast guard.

Construction: The Engineering Construction & Contracts (ECC) division of L&T is India’s
largest construction organisation. Its leading edge capabilities cover every discipline of
construction – civil, mechanical, electrical and instrumentation. L&T has also expanded its
focus to the Middle East, South East Asia, Russia, CIS, Mauritius, African and SAARC
countries. It also has keen interest in the markets of Indian Ocean rim countries, Africa and
Latin America.

Electrical & Electronics: L&T is a major international manufacturer of a wide range of

electrical and electronic products and systems. In the electrical segment, the Company holds
leadership position in low tension switchgear in India, and is rapidly establishing itself in
international markets. Its products are widely sold in markets in Europe and Australia.
Recently, L&T set up a new manufacturing base for high-end air circuit breakers in China. It
joined hands with Saudi Arabia’s reputed house of Kanoo to offer a range of high-end
intelligent electrical systems to Saudi Arabian market. L&T also manufactures custom
engineered switchboards for industrial sectors like power, refineries, petrochemical and
cement. In the electronic segment, L&T offers a wide range of meters and provides complete
control and automation systems for industries. Medical equipment and systems manufactured
by it include advanced ultrasound scanners and patient monitoring systems.
Information Technology: Larsen & Toubro InfoTech Limited, a 100 per cent subsidiary of
L&T, offers comprehensive, end-to-end software solutions and services with a focus on
Manufacturing, BFSI and Communications & Embedded Systems. It provides a cost cutting
partnership in the realm of offshore outsourcing, application integration and package
implementation.

Machinery & Industrial Products: L&T manufactures markets and provides service support
for critical construction and mining machinery – surface miners, hydraulic excavators,
aggregate crushers, loader backhoes and vibratory compactors.

Financial Analysis:

financial report          
           
ratio ananlysis 2009 2008 2007 2006 2005
current ratio          
current assets / 23448.02/1784 16406.78/1377 11884.66/9337 9535.45/6910. 8795.41/5556.
current liability 2.41 = 1.31 7.14 = 1.19 .26 = 1.27 55 = 1.38 57 = 1.58
           
Returns          
Return on
equity          
PAT/avg
shareholders 2706.20/12459. 2173.42/9555.0 1403.02/5768. 942.39/4640.1 983.85/3369.1
fund 69 = 0.28 8 = 0.23 4 = 0.24 7 = 20.31 3 = 0.29
           
ROTA          
PBIT/AVERAGE
TOTAL ASSETS          
           
Profitability          
PBITDA margine          
PBITDA/ Total 3940.41/3466.1 3155.47/25529. 2004.89/18041 1313.65/15198 1286.14/13748
income 5 = 1.14 80 = 0.12 .12 = 0.11 .63 = 0.09 .26 = 0.10