The Secretary BSE Limited Phiroze Jejeebhoy Towers, Dalai Street, MUMBAI - 400 001 STOCK CODE: 500510 National Stock Exchange Of India Limited Exchange Plaza, 5th Floor Plot No.C/1, G Block Bandra-Kurla Complex Bandra (E), Mumbai - 400 051 STOCK CODE: LT I 0 9001 REGISTERED MGMT SYS fitiA CON Levy 6;erhhcilt,011 RV., The Nelherlarele CIN : L99999MH1946PLC004768 LARSEN & TOUBRO Larsen & Toubro Limited Secretarial Department L&T House, Ballard Estate Narottam Morarjee Marg Mumbai - 400 001, INDIA Tel: +91 22 6752 5656 Fax: +91 22 6752 5893 www.Larsentoubro.com SEC/PAM/2019 July 31, 2019 Dear Sir, Sub.: Investor Presentation Pursuant to Regulation 46(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we enclose herewith a copy of updated Investor Presentation, which will be uploaded to our Investor Website http://investors.larsentoubro.com/ We request you to take note of the same. Thanking you, Yours faithfully, for LARSEN & TOUBRO LIMITED N. HARIHARAN EXECUTIVE VICE PRESIDENT & COMPANY SECRETARY (ACS 3471) Encl : as above
Pursuant to Regulation 46(2) of the SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015, we enclose herewith a copy of updated Investor Presentation, which will be uploaded to our Investor Website http://investors.larsentoubro.com/
We request you to take note of the same.
Thanking you, Yours faithfully,
for LARSEN & TOUBRO LIMITED
N. HARIHARAN EXECUTIVE VICE PRESIDENT &
COMPANY SECRETARY (ACS 3471)
Encl : as above
1
Investor Presentation
Q1 FY20July 23, 2019
2
Disclaimer
This presentation contains certain forward
looking statements concerning L&T’s future
business prospects and business profitability,
which are subject to a number of risks and
uncertainties and the actual results could
materially differ from those in such forward
looking statements.
The risks and uncertainties relating to these
statements include, but are not limited to, risks
and uncertainties regarding fluctuations in
earnings, our ability to manage growth,
competition (both domestic and international),
economic growth in India and the target
countries for exports, ability to attract and
retain highly skilled professionals, time and
cost over runs on contracts, our ability to
manage our international operations,
government policies and actions with respect to
investments, fiscal deficits, regulations, etc.,
interest and other fiscal costs generally
prevailing in the economy. Past performance
may not be indicative of future performance.
The company does not undertake to make any
announcement in case any of these forward
looking statements become materially incorrect
in future or update any forward looking
statements made from time to time by or on
behalf of the company.
3
Presentation Outline
L&T Overview
01
Group Performance
03
Business Overview
02
The Environment & the Outlook
04
4
L&T – At a Glance
India’s largest E&C company with interests in Projects, Infrastructure
Development, Manufacturing, IT & Financial Services
Professionally
Managed Company
Credit Ratings
CRISIL: AAA / Stable
ICRA: AAA (Stable)
FY 19 Group
Revenues: ₹ 1410 Bn
(approx.US$ 20 Bn)
Market Cap
(26th July, 2019):
₹ 1953 Bn
(approx. US$ 28 Bn)
`
5
L&T – At a Glance
6
L&T – Shareholding Pattern
Major Institutional Shareholders % Shares
Life Insurance Corporation of India 15.9%
HDFC Mutual Fund 3.9%
ICICI Prudential Life Insurance Co 2.0%
General Insurance Corp. of India 1.7%
Reliance Mutual Fund 1.5%
ICICI Prudential Mutual Fund 1.5%
Govt. Financial
Institutions & Insurance Companies,
22%
FII’s & GDR, 22.4%
Individuals,20%
L&T Employee Welfare
Foundation,12%
Mutual Funds & Pvt.
Insurance Cos., 17%
Bharat ETF, 0.6%
Others,6%
30th June, 2019
▪ Listed with BSE & NSE
▪ GDRs listed with LSE and LuxSE
▪ L&T is one of the most widely held listed companies in India
▪ No promoter holding
▪ Uninterrupted Dividend payment record since 1946
7
Experienced Management Team
M. V. SatishWhole-time Director & Sr. Executive Vice President
(Building, Minerals & Metals)
• BE (Civil)
• Joined L&T in 1980
Vast experience in Construction, Business
Development, Contracts Management and
Property Development in India and GCC region
Subramanian SarmaNon-Executive Director
• B.Tech (Chem.),
• M.Tech – IIT, Mumbai
• Joined L&T Group in 2015
Vast experience in managing large business portfolios in energy sector
D. K. SenWhole-time Director &
Sr. Executive Vice President (Infrastructure)
• B.SC ENGG (CIVIL), MBA (Finance)
• Joined L&T in 1989
A M NaikGroup Chairman
• BE [Mech]
• Joined L&T in March 1965
• Diverse and vast experience in general management, Technology and E&C
S. N. SubrahmanyanChief Executive Officer and Managing Director
• B.SC ENGG (CIVIL), MBA (Finance)
• Joined L&T in November 1984
• Vast experience in Design & Build (D&B)
Contracts, PPP Projects, Engineering and
Construction Industry
R Shankar RamanWhole-time Director & Chief Financial Officer
• B.Com, ACA, ACMA
• Joined L&T Group in Nov 1994
Vast experience in Finance, Taxation, Insurance, Risk Management, Legal and Investor Relations
Shailendra RoyWhole-time Director & Sr. Executive Vice President (Power)
• B.Tech
• Joined L&T in 2004
Vast experience in Thermal Power, Heavy
Engineering, Nuclear Business
Vast experience in Design & Engineering, Business
Development, Tendering and construction
J.D. PatilWhole-time Director & Sr. Executive Vice President
(Defence, L&T-Nxt)
• M.Tech- IIT, Mumbai
• Joined L&T in 1978
Vast experience in leading high technology
interdisciplinary strategic programs across
defence & aerospace sector
8
Corporate Governance
L&T’s essential character revolves around values based on transparency,
integrity, professionalism and accountability.
Four-tier Governance Structure Board
of Directors
Executive Committee (ECom)
Independent Company (IC) Board
Strategic Business Group (SBG) / Business Unit (BU)
9
Sustainability & Integrated Report
Integrated Report <IR>: Released L&T’s first IR 2017-18
• Based on International Integrated Reporting Council (IIRC)
framework
• In alignment with Global Reporting Initiative (GRI) Standards ‘In
Accordance – Comprehensive option’ – highest level of disclosure in
public domain
• Reports progress on Sustainable Development Goals (SDGs)
& National Action Plan on Climate Change
Thrust Areas
10
Sustainability – Environment & Social
CSR Highlights – 2.1 million beneficiaries Green Product Portfolio – INR 221. 25 Billion
• Theme: Building India’s Social Infrastructure
• Integrated Community Development Program
(ICDP) at four water stressed districts in 3 states
covering 11,000 + households
• 50% women participation in village development
committees
• Water infrastructure catering to 30 million people
• Secured cumulatively 650 MWp + Grid connected
solar PV projects across India
• Won first-of-its-kind distributed generation project
with a cumulative capacity of 12 MW solar power,
and 105 MWh of energy storage, to electrify 236
remote villages.
• Constructed 67.7 million Sq.ft Green buildings for
clients & 41.1 million sq. ft. green space under
construction
• Metro systems construction of 143km of viaducts,
* Finance cost of financial services business and finance lease activity
• Revenue growth driven by
Infra, Heavy Engineering ,
IT&TS and Fin Serv businesses
• Higher Fin charge opex
reflects increase in borrowing
costs and larger loan book
• Staff cost increase on account
of resource augmentation in
Services business
• Reduced SGA expenses due to
lower provisions
Rs Billion Q1 FY19 Q1 FY20 % Var
Revenue 270.0 296.4 10%
International Rev. 35% 31% -3%
MCO Exp. 164.9 179.4 9%
Fin. Charge Opex* 16.6 20.8 26%
Staff Costs 41.3 45.5 10%
Sales & Admin. 19.7 17.5 -12%
Total Opex 242.5 263.2 9%
23
Group Performance – EBITDA to PAT
• Growth in other income on higher
investment base
• Finance cost commensurate with
debt levels and phased
commencement of Hyd. Metro
• JV/S&A PAT reflects IDPL Roads &
Forgings performance. PY
includes one time INVIT gain
• E&A business classified as
discontinued operations
• Exceptional item represents
impairment in road SPV referred
to NCLT
Rs Billion Q1 FY19 Q1 FY20 % Var
EBITDA 27.6 33.2 20%
Other Income 2.3 3.8 69%
Fin. Cost (3.6) (5.9) 61%
Depreciation (6.0) (4.6) -24%
Tax Expense (8.9) (7.9) -11%
JV/S&A PAT Share 2.6 (0.7)
Non-controlling Int. (2.6) (3.4) 31%
Discontinued Operations 0.9 1.1 31%
PAT before Exceptional 12.1 15.7 29%
Exceptional item - (0.9)
Reported PAT 12.1 14.7 21%
24
Segment Performance Analysis
25
Segment Composition
Power
EPC- Coal & Gas
Thermal Power Plant
Construction
Enviro Systems
Power Equipment
Mfg. *
Infrastructure
Buildings & Factories (B&F)
Transportation Infra (TI)
Heavy Civil infra (HC)
Water & Effluent Treatment (WET)
Power T&D (PT&D)
Metallurgical & Mat. Handling (MMH)
Smart World & Comm.(SW&C)
Heavy
Engineering
Process Plant
Equipment
Nuclear Power Plant
Equipment
Piping Centre &
Forgings *
Hydrocarbon
Onshore
Offshore
Developmental
Projects
Roads *
Metros
Power
IT & TS
Information
Technology
Technology Services
Financial
Services
Rural Lending
Housing Finance
Wholesale Finance
Asset Management
Others
Realty
Industrial Products &
Machinery
Defence
Engineering
Defence
Aerospace
Shipbuilding
* Consolidated at PAT level E&A is classified as discontinued operations and consolidated at PAT level
Electrical &
Automation
Electrical Standard
Products
Electrical Systems
& Equipment
Metering & Protection
Control & Automation
26
Q1 FY20 Order Inflow Composition
Infrastructure45.2%
Power17.3%
HE0.5%
Defence Engg.1.1%
Hydrocarbon8.9%
Services21.9%
Others5.1%
Domestic76.7%
Middle East10.1%
USA & Europe8.5%
ROW4.7%
Order InflowRs 387 Bn
27
Domestic78.8%
Middle East11.4%
USA & Europe0.8%
ROW9.0%
Q1 FY20 Order Book Composition
Order BookRs 2940 Bn
Infrastructure74.4%
Power4.4%
HE1.4% Defence Engg.
3.8%
Hydrocarbon13.7%
Others2.3%
28
Domestic68.7%
Middle East14.7%
USA & Europe11.4%
ROW5.1%
Q1 FY20 Revenue Composition
Infrastructure46.8%
Power1.9%
HE3.0%
29
• Order Inflow contributed by
Public & Private sector
• Strong revenue growth on
robust order book
conversion across business
verticals
• Margins reflect stage of
execution and job mix
Infrastructure SegmentAmount in Rs bn
14%
6.8% 6.4%
Net Revenue
EBITDA Margin
30
Power Segment
• Receipt of large EPC order
replenishes Q1 Order Book
• FGD & SCR investments
provide opportunity within
demand supply imbalances in
the sector
• Revenue decline reflects low
opening order book
• Margins reflective of job mix
& stage of execution
• Profits of MHPS and other JV
companies are consolidated
at PAT level under equity
method
Net Revenue
48%
Amount in Rs bn
4.1% 3.3%EBITDA Margin
31
Heavy Engineering Segment
• Q1 Inflows impacted by
deferments
• Stellar revenue growth
driven by healthy opening
Order Book
• Global competence,
technology differentiation,
proven track record and
cost efficiencies yield
strong margins.
PY included gains from
provision reversals
Amount in Rs bn
Net Revenue
162%
36.1% 19.5%EBITDA Margin
32
Defence Engineering SegmentAmount in Rs bn
• Slow pace of policy
change continues to
inhibit private sector
participation
• Execution of tracked
artillery gun order
continues to drive
revenue growth & margins
• Margins reflect stage of
execution, job mix and
operational efficiency.
Net Revenue
33%
11.1% 16.5%EBITDA Margin
33
Hydrocarbon Segment
• Q1 Order Inflows from
domestic awards
• Revenue growth on the back of
higher Order Book
• Firm oil prices leading to
healthy prospect pipeline
• Stable margins maintained
through efficient execution
Amount in Rs bn
Net Revenue
7%
7.0% 7.6%EBITDA Margin
34
IT & Technology Services Segment
• LTI revenue growth led by CPG,
Retail & Pharma, High-Tech,
Media & Entertainment, and
Energy & Utilities
• LTTS revenue growth led by
Transportation, Plant
Engineering and Medical
Devices verticals
• Margin reduction on increased
staff costs and higher visa fees
Amount in Rs bn
Net Revenue
15%
24.8% 23.2%EBITDA Margin
35
Developmental Projects Segment
• Segment includes Power
Development business, Hyderabad
Metro
• Kattupalli Port divestment drove
revenues & margins for PY
• Revenue largely contributed by
Power Development Business
• Hyderabad Metro: Partial CoD of
30 Km in Nov’17, 16 km in Sept’18
and 9 km in Mar’19. Total of 55
km
• Margin profile still emerging
• IDPL (Roads & TL) consolidated at
PAT level under Equity method
Amount in Rs bn
Net Revenue
21%
30.4% 10.0%EBITDA Margin
36
Others Segment
• Segment comprises
Construction & Mining
Equipment, Rubber processing
Machinery, Industrial Valves and
Realty businesses
• PY revenues included bulk
handover of apartments in
Parel project
• Margin fluctuation due to
business mix variation
Amount in Rs bn
14%
26.5% 24.1%
Net Revenue
EBITDA Margin
37
L&T Finance Holdings Group
Note: Gross Stage 3 Assets include GNPA> 90 DPD + Impaired assets (S4A, SDR, 5:25, etc.) where regulatory forbearances are available + Identified standard assets which are under incipient stress
• Strong growth in a challenging environment
• Focus continues on retailisation of loan book, robust NIMs & Fee Income, prudent ALM,
quality of assets and increasing the diversity of funding sources
• PAT impacted by credit provision on exposure to an HFC
Rs Bn Q1 FY19 Q1 FY20 % Var
Income from Operations 30.6 34.6 13%
PAT (Net of NCI 3.6 3.5 -2%
Mutual Fund Average AUM 711.2 735.0 3%
Net Loan Book 863.2 999.0 16%
Gross Stage 3 Assets 7.9% 5.7% -220bps
Net Stage 3 Assets 3.2% 2.5% -70 bps
Networth 119.5 139.9 17%
38
Electrical & Automation SegmentAmount in Rs bn
Net Revenue
6%
13.3% 16.9%EBITDA Margin
• Revenue growth aided by
Standard Products and
Meters business
• Margin increase reflects
operational efficiencies
and better realisation
E&A is classified as discontinued operations in Financial Statements
