Larsen & Toubro (L&T) reported a strong performance for the quarter ended September 30, 2025. The company’s consolidated profit after tax rose 16 per cent year-on-year to ₹3,926 crore, showing its continued strength in execution and project management. Revenue from operations also increased by 10 per cent, reaching ₹67,984 crore compared to the same quarter last year. This growth was supported by steady project execution in India and a strong contribution from international markets.
The quarter demonstrated L&T’s ability to navigate challenges while maintaining profitability. The combination of solid revenue growth and a well-diversified business model across sectors such as infrastructure, energy, manufacturing, and technology services played a key role in this outcome.
One of the most notable highlights of the quarter was the robust rise in order inflows. L&T secured new orders worth ₹115,784 crore, marking an impressive 45 per cent year-on-year increase. This growth was driven by new contracts in infrastructure, hydrocarbon, renewable energy, data centers, and manufacturing projects.
Of the total new orders, around 65 per cent came from international markets, reflecting L&T’s increasing success in winning large projects overseas. The company’s consolidated order book as of September 30, 2025, stood at ₹667,047 crore, up 15 per cent compared to March 2025. International orders made up about half of this backlog.
This expanding order book gives L&T strong revenue visibility for the coming years and highlights its strategic advantage in diversifying operations beyond India.
L&T operates through several business segments, each contributing to overall growth. The Energy Projects segment showed exceptional performance during the quarter. Its order inflows surged by more than 100 per cent year-on-year to ₹38,156 crore, driven by major wins in onshore and offshore hydrocarbon projects. Segment revenues also rose sharply by 48 per cent to ₹13,082 crore.
The Infrastructure Projects segment, which includes transportation, water, and power transmission works, recorded order inflows of ₹52,686 crore, an increase of 6 per cent compared to last year. However, revenue in this segment declined slightly by 1 per cent to ₹31,759 crore, mainly due to slower progress in some water-related projects and the extended monsoon season, which delayed construction activities.
Meanwhile, the IT & Technology Services segment continued its upward trend. Its revenue rose by 13 per cent year-on-year to ₹13,274 crore, reflecting consistent demand for digital transformation and technology-led services from global clients.
While overall growth remained strong, margins came under slight pressure in some segments. The Energy Projects business, for example, saw its EBITDA margin decline to 7.3 per cent from 8.9 per cent a year earlier. This was largely due to project variations and costs associated with closing large contracts.
At the consolidated level, L&T’s EBITDA rose about 7 per cent to approximately ₹6,806 crore, though the EBITDA margin for the quarter slipped slightly to 10 per cent from 10.3 per cent in the previous year. These figures suggest that while the company is efficiently scaling up, certain cost pressures and contract structures could affect short-term profitability.
Nevertheless, overall earnings quality remains sound, supported by a healthy mix of projects, a strong order book, and prudent cost management.
L&T maintained a strong balance sheet during the quarter. The company’s debt-to-equity ratio improved to 1.09 as of September 30, 2025, compared with 1.17 in the previous year. This improvement shows better financial discipline and efficient use of capital.
International business continued to strengthen, contributing 56 per cent of total revenues for the quarter. This growing share of global operations provides a cushion against domestic slowdowns and enhances the company’s ability to manage cyclical variations in India’s infrastructure sector.
Cash flows remained robust due to efficient project execution and steady inflows from clients. This liquidity strength enables L&T to invest in new opportunities while maintaining flexibility in financing.
Despite strong growth, several challenges remain for L&T. The company’s large, complex engineering and construction projects carry execution risks such as cost overruns, supply-chain disruptions, and delays in approvals. The margin decline in the Energy Projects segment reflects the impact of such challenges.
In the domestic market, prolonged monsoon conditions and slow progress in certain civil and water projects affected revenue recognition. Such seasonal and environmental factors continue to pose near-term operational challenges.
Globally, L&T faces uncertainties from geopolitical tensions, commodity price fluctuations, and changes in trade policies. Any prolonged global slowdown could impact international project timelines and profitability.
L&T’s strong international presence is a major advantage. With nearly two-thirds of its new orders coming from outside India, the company is well positioned to tap global opportunities in infrastructure and energy development. The Middle East, Africa, and parts of Asia are expected to remain high-growth regions for large-scale engineering and construction work.
The company is also focusing on technology-driven businesses. The growth of IT & Technology Services and hi-tech manufacturing segments offers a long-term opportunity for better margins and less cyclicality. L&T’s strategic plan, known as Lakshya 2026, aims to sharpen focus on high-growth areas such as digital services, renewable energy, and advanced manufacturing.
Another key move is L&T’s plan to streamline its portfolio. It has initiated steps to exit non-core public concession assets such as its stake in L&T Metro Rail (Hyderabad) Limited. This divestment aligns with the company’s long-term strategy to focus on higher-return businesses and reduce exposure to capital-intensive assets.
Going forward, maintaining healthy margins while executing large projects efficiently will be crucial. Investors and analysts will closely watch whether the slight margin compression seen in Q2 is temporary or a sign of sustained cost pressures.
Order inflows will remain a major focus area. Sustaining the strong 45 per cent growth in new orders will be challenging, and the quality of those orders — particularly their margin profile and payment terms — will matter as much as the quantity.
Working capital management will also be critical. Efficient cash conversion and timely collections from clients will ensure that L&T maintains its financial flexibility to invest in new opportunities and navigate market uncertainties.
Given the company’s large exposure to international markets, factors such as currency movements, commodity prices, and regional stability will continue to influence performance.
L&T’s second-quarter results for FY26 underline its resilience, strong execution capabilities, and expanding global footprint. The double-digit profit growth, steady revenue rise, and record order inflows underscore its position as a leading engineering and infrastructure conglomerate.
The company’s diversified portfolio across energy, infrastructure, technology, and manufacturing provides stability against market fluctuations. With a strong order book of ₹667,047 crore, L&T has secured visibility for the next several years of revenue.
However, maintaining margin discipline and timely project execution will determine the sustainability of this performance. Global economic conditions, raw material costs, and geopolitical events remain variables that could impact profitability.
Overall, L&T enters the second half of FY26 on a strong footing. Its strategic focus on international expansion, technology-led businesses, and financial prudence positions it well to continue delivering consistent growth, even in an uncertain global environment. The coming quarters will reveal how effectively the company converts its massive order pipeline into sustained earnings momentum and long-term value creation.