L&T unit bags up to ₹2,500 cr project in Australia; stock up

Shares of Larsen & Toubro Ltd surged today after its subsidiary L&T Energy Hydrocarbon was awarded a ₹1,000-2,500 crore project by the Saipem & Clough JV (SCJV), Australia, for fabrication and the supply of process and piperack modules for a 2.3 MMTPA urea plant for Perdaman Chemicals and Fertilisers Pty Ltd.

Perdaman is a multinational group based in Western Australia, with a long-standing track record of involvement within a diverse range of markets.

The plant will be constructed on the Burrup Peninsula, around 20 km north of Karratha, Western Australia. Once completed, this state-of-the-art facility will be the largest urea plant in Australia and one of the largest in the world.

The scope comprises about 50,000 MT of modules to be delivered in 32 months. These modules will be fabricated at L&T’s Kattupalli Modular Fabrication Facility. Fabricated modules will be shipped in a fully tested, pre-commissioned, and ready-to-install condition to the project site in Australia.

L&T says its heavy engineering was successful in securing multiple orders for the complete package of urea equipment for the same project.

The equipment will be supplied consists of urea reactors, carbamate separators, carbamate condensers, and urea strippers, says the company, adding that this order reinforces L&T’s dominance in the manufacturing and supply of urea equipment with Snamprogetti (TM) Technology.

The project scope comprises about 1,160 MT of equipment to be delivered progressively in 25 months.

Perdaman chairperson Vikas Rambal says: “The state-of-the-art facility will help to ensure that Australia has a secure and reliable source of high-quality urea and therefore food security. Perdaman’s foundational mission is to unify the International and Australian expertise to create a better tomorrow and we are very proud to embed our mission into Project Ceres."

Subramanian Sarma, whole-time director & senior executive, vice-president (energy) says the project aligns with the company's "strategic goal of expanding geography and client base and underscores our commitment to extend the concept of modularization to onshore projects”.

Last week, L&T's buildings & factories (B&F) business also secured orders in India and Bangladesh. It includes an order from the Uttar Pradesh Cricket Association for the “Construction of a Cricket Stadium at Varanasi, Uttar Pradesh” on Design & Build Turnkey Basis. The seating capacity of the stadium will be 30,000 spectators. The total site area under development is 30.67 acres.

The business also secured another order from the Bangladesh Hi-Tech Park Authority to construct hi-tech IT parks at four locations across Bangladesh. This project is funded by EXIM Bank.

The L&T scrip, meanwhile, is trading marginally higher at ₹2,639.90 on the BSE today, as compared to the previous closing session. The stock surged to the intra-day high of ₹2,650 today, propelling its market cap to ₹3,72,356.35 crore.

L&T had posted a 46.5% year-on-year (YoY) growth in consolidated net profit at ₹2,493 crore for the April-June quarter of 2023-24 from ₹1,702 crore in the corresponding quarter of the previous year. The consolidated revenue stood at ₹47,882 crore for Q1 FY24, recording a YoY growth of 34%, while the EBITDA came in at ₹4,869 crore, which was 23% higher as compared to ₹3,953 crore in the same period of the last fiscal.