India's L&T quarterly profit falls as Middle East conflict disrupts projects (updated)

Larsen and Toubro

05/05/2026 13:01

Rewrites throughout with comments from CFO and background

By Urvi Dugar

BENGALURU, May 5 -
Indian construction major Larsen & Toubro LART.NS said on Tuesday it expects revenue to grow at a slightly slower pace of 10-12% for the current fiscal, as disruptions due to the Middle East conflict hurt its business in the region.

The U.S.-Israeli war on Iran is posing challenges for Indian companies with exposure to the region, disrupting project execution, delaying payments and pushing up input and logistics costs.

L&T expects these pressures to build over the next two quarters, finance chief R. Shankar Raman said on a post-earnings call.

"The disruption will begin to show off in the first six months of the current year because shipments will all get delayed," he added.

Larsen & Toubro, which recorded 12% revenue growth in the year ended March 31, shed about 1.1 trillion Indian rupees ($11.56 billion) in market value in the weeks after the war started. However, brokerage Jefferies said that the selloff may have been overdone.

The company, widely seen as a barometer of India's infrastructure sector, said the Middle East accounted for about 40% of its record 7.4 trillion rupee ($77.74 billion) order backlog during the quarter. Overall, international orders made up 52% of that backlog.

L&T said it aims to keep margins broadly stable at around the reported 8.3% for fiscal 2027 and expects an order book growth of 10-12%.

While many contracts allow for time extensions and cost recovery in force majeure-like situations, Raman cautioned that reimbursements could lag.

Analysts at several brokerages have warned of risks to L&T's Middle East operations from possible project delays, execution hurdles and higher costs, if geopolitical tensions persist, but said its diversified order book and robust domestic pipeline should help cushion the impact.

The Mumbai-headquartered firm also appointed P. Ramakrishnan as its next CFO after Raman steps down at the end of June.

For fiscal 2026, L&T reported a 7% rise in consolidated profit after tax, while expenses rose about 12%.

($1 = 95.1847 Indian rupees)

Larsen & Toubro's order book split over the past 10 years https://reut.rs/4d0VQlV

L&T's stock largely flat compared to peers year-to-date https://reut.rs/4ti6L0W

 (Reporting by Urvi Dugar and Pranav Kashyap in Bengaluru; Editing by Sonia Cheema, Mrigank Dhaniwala and Leroy Leo)

 ((UrviManoj.Dugar@thomsonreuters.com; +91 9558725583;))