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LARSEN & TOUBRO LI MI TED LARSEN & TOUBRO LI MI TED Analyst Presentation Analyst Presentation Q1 FY1 1 Q1 FY1 1 27 July, 2010 Presentation Outline Q1 FY11 Performance Summary Segmental Analysis Seg e a a ys s

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SLIDE 1

LARSEN & TOUBRO LI MI TED LARSEN & TOUBRO LI MI TED

Analyst Presentation Analyst Presentation – – Q1 FY1 1 Q1 FY1 1

27 July, 2010

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SLIDE 2

Presentation Outline

Q1 FY11 Performance Summary Segmental Analysis Seg e a a ys s Performance of Key Subsidiaries Performance of Key Subsidiaries O l k Outlook

2 27 July, 2010

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SLIDE 3

Presentation Outline

Q1 FY11 Performance Summary Segmental Analysis Seg e a a ys s Performance of Key Subsidiaries Performance of Key Subsidiaries O l k Outlook

3 27 July, 2010

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SLIDE 4

Performance Highlights

6 3 %

Robust grow th in Order I nflow s driven by Pow er and I nfrastructure

5 0 %

Healthy Order Book Position

6 %

Revenues

1 6 0 bps

EBI TDA Margin

1 5 %

Recurring PAT

4 27 July, 2010

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SLIDE 5

Order Inflow & Order Book – Q1 FY11

Sectoral Break-up

3 2 % 2 5 % 3 3 % 5 2 % 1 4 % 7 % 1 5 % 8 % 6 % 8 %

Order Book: Rs 1 0 7 8 1 6 Bn Order I nflow :

  • Rs. 1 5 6 .2 6 Bn

3 2 % 3 3 % 1 4 % 1 5 % 6 % I nfrastructure Pow er Hydrocarbons Process Others

  • Rs. 1 0 7 8 .1 6 Bn

I nfrastructure

Roads & Bridges Ports & Harbours

Pow er

Generation Equipments

Hydrocarbons

Upstream Mid &

Process

Minerals &

Metals Others

Shipbuilding Defense & Airports Railways Buildings &

Factories

Urban Infra Electrification /

Transmission & Distribution Downstream

Pipelines Valves Bulk Material

Handling

Fertilizer

Aerospace

Construction &

Mining Eqpt.

Electrical &

Electronic Products 27 July, 2010

Urban Infra Water

Electronic Products

Technology Services

5

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SLIDE 6

Order Inflow & Order Book – Q1 FY11

5 % 1 % 2 % Geographical Break-up 1 3 % Custom er Profile 1 0 % 5 % 4 7 % 3 4 % 1 3 % 8 9 % 9 3 % 2 1 % 4 7 % 4 5 % 4 0 % Order I nflow Order Book Dom estic Middle East Order I nflow Order Book Private Public ( I ncl. PSUs) 27 July, 2010 6 Others Public ( I ncl. PSUs)

  • Devl. Projects ( L&T)
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SLIDE 7

Performance Summary - Topline

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY1 0 Net Sales 78.35 73.63 6% 366.75

  • -- Exports

10 47 15 32 64 46 Exports 10.47 15.32 64.46 Other Operational Income 0.50 0.45 3.60 Total Net Revenues 7 8 .8 5 7 4 .0 8 6 % 3 7 0 .3 5

Re en e acc als a e along planned lines Revenue accruals are along planned lines Sales growth driven by non-E&C segment Growth influenced by: Back-ended Order Inflows in FY10 (in initial stages of execution) ( g ) Long-cycle jobs with lengthier contracted execution timelines Increased level of International Orders yet to translate into revenues

7

7 27 July, 2010

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SLIDE 8

Performance Summary – Operational Costs

Rs Bn % to Total Net Revenues Rs Bn % to Total Net Revenues Particulars Q1 FY1 1 Q1 FY1 0 Manf., Cons. & Opex (MCO) 59.44 75.4% 57.32 77.4% Staff Costs 5.63 7.1% 5.11 6.9% Sales adm & other Exp 3 71 4 7% 3 35 4 5%

Red ced MCO E penses (% of Re en es) net o tcome of

Sales, adm. & other Exp. 3.71 4.7% 3.35 4.5% Total Operational Costs 6 8 .7 8 8 7 .2 % 6 5 .7 8 8 8 .8 %

Reduced MCO Expenses (% of Revenues), net outcome of: Lower subcontracting costs Higher material consumption including effect of commodity price rise p Operational efficiencies Increase in staff costs in line with manpower increase SGA expenses in line with sales.

8

8 27 July, 2010

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SLIDE 9

Performance Summary – Profitability

%

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY1 0 EBITDA 10.07 8.30 21% 48.16 EBI TDA Margins 1 2 .8 % 1 1 .2 % 13.0% I E (1 42) (1 10) 30% (5 05) Interest Expenses (1.42) (1.10) 30% (5.05) Depreciation (1.14) (0.94) 22% (4.15) Other Income 2.26 2.25 9.10 Provision for Taxes (3.11) (2.73) (16.21) PAT before Exceptional I tem s 6 .6 6 5 .7 8 1 5 % 31.85 Extraordinary & Exceptional Items (Net of tax)

  • 10.20

11.91 Profit after Tax 6 .6 6 1 5 .9 8

  • 5 8 %

43.76

Uptick in EBITDA margins driven by E&C business Interest costs in line with borrowing level

  • bo
  • g

Q1 FY10 exceptional on account of gain on UltraTech stake sale

9

9 27 July, 2010

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SLIDE 10

Performance Summary – Balance Sheet

Rs Billion Jun 10 Mar 10 I ncrease /

  • Rs. Billion

Jun-10 Mar-10 / ( Decrease) Net Worth 190.84 183.12 7.72 Loan Funds 79.30 68.01 11.29 Deferred Tax Liabilities Deferred Tax Liabilities (Net) 0.95 0.77 0.18 Total Sources 271.09 251.90 19.19 Net Fixed Asset 66.17 63.66 2.51 Current Investments 87 66 79 65 8 01 Current Investments 87.66 79.65 8.01 Invt./ ICDs/ Loans & Advances to S&A Cos 80.95 76.79 4.16 Other Investments 5.50 5.49 0.01 Net Current Assets 30 81 26 31 4 50

Gross D/ E: 42% C O tl R 3 63 B

Net Current Assets 30.81 26.31 4.50 Total Applications 271.09 251.90 19.19

Capex Outlay: Rs. 3.63 Bn Increase in Segmental Net Working Capital as % of Sales from 7.6% to 9% Support to S&A Cos includes: L&T Power – Rs. 1.46 Bn L&T Gene al Ins ance Rs 1 46 Bn

10

10

L&T General Insurance - Rs. 1.46 Bn L&T IDPL – Rs. 1.18 Bn

27 July, 2010

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SLIDE 11

Presentation Outline

Q1 FY11 Performance Summary Segm ental Analysis Seg e a a ys s Performance of Key Subsidiaries Performance of Key Subsidiaries O l k Outlook

11 27 July, 2010

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SLIDE 12

Segmental Break-up – Q1 FY11

Machinery & Industrial P d t Others 1 6 %

Net Revenues

Engineering & Construction 8 3 .2 % (86.2% ) Electrical & Electronics 8 6 % Products 6 .6 % (5.7% ) 1 .6 % (1.0% ) 8 .6 % (7.1% ) Machinery & Industrial Products Others 3 .1 % (0 6% )

EBI TDA

Engineering & Construction 7 9 .0 % (80.9% ) Electrical & Electronics 7 .2 % 1 0 .7 % (10.6% ) (0.6% ) (7.9% ) Figures in the bracket indicate Previous Year’s Composition

12

Figures in the bracket indicate Previous Year s Composition

27 July, 2010 12

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SLIDE 13

‘Engineering & Construction’ Segment

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY10 Total Order Inflows 138.45 83.73 65% 638.99

  • -- Exports

14.61 4.38 29.31 Total Order Book 1,055.54 699.52 51% 983.86

  • -- Exports

75.37 96.08 71.28 Total Net Revenues 65.60 63.86 3% 318.42

  • -- Exports

8.50 13.51 56.26 EBITDA 8.94 7.60 18% 43.39 EBITDA Margins 13.6% 11.9% 13.6% Net Segment Assets 70.92 68.45 4% 62.91

Ordering Environment turning favourable in domestic market Export market showing signs of pick-up (mainly GCC) Longer execution cycles due to increasingly complex long cycle jobs Improvement in EBITDA margins through reduced MCO expenses and favorable job mix Increase in Net Segment assets due to Working Capital

27 July, 2010 13

Increase in Net Segment assets due to Working Capital

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SLIDE 14

‘Electrical & Electronics’ Segment

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY10 Total Net Revenues 6.80 5.25 30% 26.94 Exports 0 53 0 52 2 74

  • --Exports

0.53 0.52 2.74 EBITDA 0.82 0.74 11% 4.23 EBITDA Margins 12.0% 14.1% 15.7% Net Segment Assets 11.09 11.51

  • 4%

11.32

Favourable Domestic Industrial climate driving higher sales Exports affected by project deferments in Middle east Margins under pressure due to higher commodity prices, change in g p g y p , g product mix and lower price realisations Reduction in Net Segment Assets on account of better working capital management

27 July, 2010 14

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SLIDE 15

‘Machinery & Industrial Products’ Segment

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY10 Total Net Revenues 5.23 4.20 25% 21.35 Exports 0 31 0 58 2 06

  • --Exports

0.31 0.58 2.06 EBITDA 1.20 0.99 21% 4.71 EBITDA Margins 23.0% 23.7% 22.1% Net Segment Assets 1.76 2.94

  • 40%

2.24

Revenue increase anchored by allround industrial recovery barring valves business. Good Recovery in Construction and Mining business Export Order Inflow picking up in Valves and rubber processing p p g p p g businesses; translation to revenues in subsequent quarters Margins holding firm despite cost pressures Reduction in Segment assets achieved through lower Net Working Capital levels

27 July, 2010 15

Capital levels

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SLIDE 16

‘Others’ Segment

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 % Change FY10 Total Net Revenues 1.22 0.77 58% 3.65

  • --Exports

1.12 0.71 3.26 Exports 1.12 0.71 3.26 EBITDA 0.35 0.06 487% 0.52 EBITDA Margins 28.9% 7.8% 14.2% Net Segment Assets 2.03 2.15

  • 6%

2.03

Mainly represented by Engineering Services S l h l d b f bl k d S d Sales growth led by favourable market conditions in USA and Europe Smart improvement in margins due to better manpower utilisation and improved price realisation and improved price realisation

27 July, 2010 16

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SLIDE 17

Presentation Outline

Q1 FY11 Performance Summary Q1 FY11 Performance Summary Segmental Analysis Segmental Analysis Perform ance of Key Subsidiaries Perform ance of Key Subsidiaries Outlook Outlook

17 27 July, 2010

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SLIDE 18

Performance of Key Subsidiaries

Q1 FY11 Q1 FY10 % Change Q1 FY11 Q1 FY10 % Change Q1 FY11 Q1 FY10 L&T Infotech 5.65 4.73 19% 0.79 0.61 30% 14.0% 12.9% PAT Margins Total I ncome PAT

  • Rs. Billion

L&T Infotech 5.65 4.73 19% 0.79 0.61 30% 14.0% 12.9% L&T Finance 2.87 1.98 45% 0.58 0.24 145% 20.3% 12.0% L&T Infrastructure Finance 1.48 0.86 71% 0.48 0.22 118% 32.2% 25.3%

L&T Infotech Revenue and PAT growth indicative of IT sector recovery L&T Fi L&T Finance Growth driven by allround recovery Smart Increase in NIM Business Assets – Rs. 80 Bn (PY : Rs. 50 Bn) L&T Infra Finance Growth driven by strong domestic demand for Infrastructure funding Healthy improvement in NIM Business Assets Rs 45 Bn (PY : Rs 30 Bn)

27 July, 2010 18

Business Assets – Rs. 45 Bn (PY : Rs. 30 Bn)

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SLIDE 19

Developmental Projects

Roads and Bridges:

Portfolio: 15 projects; 7 operational, 8 under implementation Development: 5646 lane km Project Outlay: Rs 132 Bn Project Outlay: Rs. 132 Bn

Ports:

Portfolio: 3 projects; 1 operational, 2 under implementation Capacity: 45 Mn TPA

Urban I nfrastructure:

Portfolio: 19 projects; 6 operational, 13 under implementation Capacity: 45 Mn TPA Project Outlay: Rs. 53 Bn p j ; p , p Area: 28 Mn sq. ft. Project Outlay: Rs. 89 Bn

Pow er:

Portfolio: 3 projects under implementation Capacity: 1479 MW Project Outlay: Rs. 110 Bn 19

Total Equity Invested (June 2010): Rs. 33.5 Bn Total Project Cost (June 2010): Rs. 384 Bn Total Equity Commitment (June 2010): Rs. 74.8 Bn

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SLIDE 20

Presentation Outline

Q1 FY11 Performance Summary Segmental Analysis Seg e a a ys s Performance of Key Subsidiaries Performance of Key Subsidiaries O l k Outlook

20 27 July, 2010

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SLIDE 21

Outlook

Governm ent Policy Policy Strong Balance Sheet – Robust Fin. Capacity & Capability build up

Sustainable Grow th

Sheet Robust Fin. Metrics p y p Business Model

  • Strategy &

Stable Dom estic Econom ic & Fiscal

  • Strategy &

Grow th Drivers Environm ent; volatile global situation

27 July, 2010 21

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SLIDE 22

Thank You Thank You

22

27 July, 2010 22

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SLIDE 23

Annexure 1 : Details of Other Income

  • Rs. Billion

Q1 FY1 1 Q1 FY1 0 Interest Incom e 0.65 0.30 Dividend from S&A Com panies 0 50 0 11 Dividend from S&A Com panies 0.50 0.11 Incom e from Other Investm ents 0.56 0.64 Profit on sale of investments 0.01 0.82 Miscellaneous Income 0.54 0.38 Total - Other I ncom e 2 .2 6 2 .2 5 27 July, 2010 23