Larsen & Toubro (LT) Q4 25/26 earnings summary

Executive summary

• Achieved record order inflows of ₹4,356 bn (up 22% YoY), with international orders comprising 52%-58% of the order book and no project cancellations despite geopolitical disruptions.

• Revenue grew 12% YoY to ₹2,859 bn, driven by Hi-Tech Manufacturing, Energy, and Financial Services, with 54% from international markets.

• Recurring PAT increased 18% YoY to ₹172 bn; reported PAT rose 7% to ₹161 bn, impacted by a one-time labour code provision.

• Return on equity (excluding labour code impact) improved to 16.6%.

• Signed agreements for divestment of Nabha Power and Hyderabad Metro; strategic acquisitions and partnerships across multiple sectors.

Financial highlights

• Order book reached ₹7,403 bn, up 28% YoY; Q4 order inflows flat YoY at INR 898 bn.

• Group revenues for Q4 FY26: INR 828 bn, up 11% YoY; recurring PAT: INR 53 bn, up 5% YoY.

• EBITDA margin for FY26: 10.2% (down from 10.3% YoY); projects and manufacturing margin: 9.4%.

• Net working capital to revenue ratio improved to 4.1%, a multi-year low.

• Debt-equity ratio improved to 0.95; net debt/equity at 0.35.

Outlook and guidance

• FY27 guidance: order inflow and revenue growth of 10%-12%, with a softer H1 due to supply chain issues and margin stability in PP&M at 7.8%.

• Five-year Lakshya 2031 plan targets: 10%-12% order inflow CAGR, 12%-15% revenue CAGR, 16%-17% ROE, with investments in green energy, data centers, and electronics.

• Strategic focus on growth engines such as Data Centers, Green Hydrogen, and Semiconductor Design.

• Macro assumptions include sustained domestic investment, selective international diversification, and resilience to geopolitical and input cost risks.