Larsen and Toubro


Industry Profile :
 Infrastructure is key for any developing economy like India. Road, dam, bridge, port, airports are important for development of economy. Govt of India understand the importance of such things and working for development of them. India is second largest network of road 4.7 million km. It is reason for 60% of transport of goods and 85% passenger traffic in India. Road transport has been gradually increase in recent years due to increased connectivity between town, cities. Increased sale of automobile and movement of fraight also reason for development of roads.

Road sector though enjoying attention, Port and airport came into limelight recently as compared to roads and railway. For being developed economy, with port, Engineering sector is also important. Capital good and Engineering sector turnover is expected to reach $140 billion till 2020. Engineering exports account 60% of  total export, mainly to US and Europe. Recently export to Bangladesh, Japan, south Korea in increased.

Company Profile : The company company is major indian multinational in Technology, Engineering, Construction, manufacturing, financial services. It is also operating in sector like Hydrocarbon, Power, Infrastructure, defence, Realty. The company is engaging in construction of building and factory, Turnkey Projects for sectors like Power and Water Treatment, waste treatment. Building, repairment service of Power plants. Heavy Engineering including Custom designed and engineered and service of critical equipment. Electrical and automation work for business. Shipbuilding and defence, Service related to financial services sector, Infrastructure Financial. Mutual Funds. IT and Services.

Shareholding Pattern  :. There is no Promoter and the company owned by Financial Institution. Mutual Funds own 11.72% Financial Institution and bank owned 7.33%. 20.23% is owned by Insurance Company out of which large part is held with Life Insurance Corporation. Foreign Investors owned 17.60%. Remaining is with public.

Financials and Ratios  : 

 2010-112011-122012-132013-142014-152015-162016-17
Revenue45,053.3354,508.8062,724.1658,479.8159,300.7862,185.5867,695.71
Net profit3,957.894,456.504,910.655,493.135,056.185,311.465,453.74
NPM9.018.388.069.708.868.888.29
EPS65.3372.9279.3359.0054.1056.8058.30
Book Value358.45411.53473.23362.96398.78436.96493.20
Dividend Payout22.3022.6723.1824.0429.8732.0032
Dividend Per Share14.5016.5018.5014.2516.2518.2521.00
ROE18.1317.6816.8616.3213.6313.0411.85
ROCE14.2314.2213.1113.7510.8910.6610.15
ROA6.936.586.807.015.815,475.33
debt to equity0.290.330.270.280.330.300.21
Asset Turnover76.8778.6184.3472.2865.6061.5864.31

Future Prospects  :  The company is leader in infrastructure. Recently the company sold non core investments, for reducing debt. Now the company is concentrating on defense sector as per its five year plan. Govt of india is also concentrating on the plan to make defence related products. The plan for it is ready. Even though there is no Promoter, the company is in hand of financial institutions like SBI and LIC so indirectly Govt of India is holding it. So there is no problem about corporate governance. Good company to keep in your portfolio.

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About Ashutosh Tilak

Tracking Indian Capital Market since 2010. Finance Student, On this blog I am writing about finance and Investing. You can contact me analystashu@gmail.com or @androidashu & @InsideFinanc on twitter