Highlights

• Larsen & Toubro reported FY26 order inflow growth of 22% year-on-year.
• International projects contributed 52% of the company’s FY26 consolidated order book.
• FY26 recurring profit after tax increased 18% despite margin pressure in select segments.

Larsen & Toubro Limited (NSE:LT) reported consolidated revenue of Rs. 2.86 trillion for FY26, reflecting a 12% year-on-year increase. The company’s order inflow for the year stood at Rs. 4.36 trillion, up 22% compared to FY25, while the consolidated order book rose 28% year-on-year to Rs. 7.40 trillion.

The engineering and construction major stated that international orders represented 52% of the total order book as of March 31, 2026. Revenue contribution from international operations stood at 54% during FY26. Recurring profit after tax for FY26 increased 18% year-on-year to Rs. 172 billion. Reported profit after tax rose 7% to Rs. 161 billion.

Source: Analysis by Kalkine

Infrastructure and Energy Segments Drive Performance

The Infrastructure Projects segment recorded FY26 revenue of Rs. 1.34 trillion, up 3% year-on-year. Segment EBITDA margin improved to 6.9% from 6.4% in FY25. The Energy Projects segment posted FY26 revenue growth of 35% to Rs. 548.6 billion. However, EBITDA margin declined to 6.8% from 8.5% in the previous year due to cost overruns and close-out expenses in legacy projects.

Hi-Tech Manufacturing revenue increased 46% year-on-year to Rs. 141.1 billion, supported by execution momentum in Precision Engineering & Systems operations. The IT & Technology Services segment delivered 12% revenue growth to Rs. 535 billion during FY26. Segment EBITDA margin remained stable at 19.5%.

Working Capital and Cash Flow Improve

L&T reported net working capital to revenue ratio of 4.1% in FY26 compared to 11% in FY25. The company stated that this represented a multi-year low with an improvement of 690 basis points. Cash flow from operations excluding the financial services business increased 87% year-on-year to Rs. 355 billion in FY26.

Gross debt-to-equity ratio improved to 0.95 in FY26 from 1.12 in FY25. Net debt-to-equity ratio declined to 0.35 from 0.60 in the previous year.

Source: company filing

Divestment Plans and Strategic Expansion Continue

The company signed share purchase agreements for the divestment of Nabha Power and Hyderabad Metro assets. Both assets were classified as held for sale, with closure expected in Q1 FY27. L&T also highlighted strategic acquisitions, partnerships, and memorandums of understanding across renewables, defence, semiconductor, and realty businesses during FY26.

Chairman and Managing Director S. N. Subrahmanyan said the company continued investments in new growth areas including data centers, green hydrogen, semiconductor design, and electronic products manufacturing.

Margin Trends Remain Mixed Across Businesses

While several business segments reported revenue growth, margin performance remained mixed across operations. The Energy Projects segment reported lower margins due to legacy project costs, while Development Projects margins declined because FY25 included gains from transit-oriented development monetisation in Hyderabad Metro. The Others segment reported lower revenue from residential unit handovers because of occupancy certificate deferrals in the Realty business.

Key Risks

• Rising input costs may affect project execution profitability and operating margins.
• Delays in private sector investments could impact future order inflows.
• Geopolitical tensions may disrupt international supply chains and project timelines.
• Cost overruns in legacy projects could continue affecting segment profitability.

Summary

Larsen & Toubro (NSE:LT) reported FY26 revenue growth of 12% alongside a 28% increase in its order book. International projects remained a major contributor to business expansion. While recurring profit rose during the year, margin pressure persisted in selected segments including Energy Projects and Development Projects. The company also improved working capital efficiency and cash flow while continuing investments in technology, green energy, and infrastructure-related businesses.

FAQs

Q: What was Larsen & Toubro’s FY26 consolidated revenue?
A: Larsen & Toubro reported FY26 consolidated revenue of Rs. 2.86 trillion, up 12% year-on-year.

Q: How much did L&T’s FY26 order book increase?
A: L&T’s consolidated order book increased 28% year-on-year to Rs. 7.40 trillion in FY26.

Q: Which segment reported the highest revenue growth during FY26?
A: The Energy Projects segment reported 35% revenue growth during FY26 compared to the previous financial year.