L&T has made an equity commitment of Rs 17,100 crore to the infrastructure projects announced by its group companies. The total value of these projects stands at Rs 84,400 crore.
A recent report of Edelweiss Securities estimated “equity commitments pending to be invested” at Rs 10,800 crore. These investments will be made by L&T Infrastructure Development Ltd, L&T Power Development Ltd and L&T Metro. The report also said Rs 2,000 crore of those investments would be made in the current year.
Stable outlook
Giving L&T a “stable” outlook, the rating agency Crisil in rating the various debt instruments of L&T has lauded the company for its capabilities. “These strong competencies across segments and sectors, along with a sound track record of completing projects as per specifications, have resulted in a very strong brand image for L&T in India and abroad,” Crisil said in a statement issued last week. The agency noted that L&T had an order book of Rs 153,100 crore as at the end of last quarter. It observed that the even division of orders between government/PSUs (32 per cent), private sector 51 per cent and L&T’s captive (17 per cent) “mitigates risks related to sector concentration”.
L&T’s financial flexibility stems from large cash and cash equivalents of Rs 1,066 crore and surplus current investments of Rs 5,860 crore as on June 30, and its demonstrated ability to raise funds at competitive rates, says Crisil.