Larsen & Toubro (LT) Q3 25/26 earnings summary

Executive summary

• Achieved record quarterly order inflow of INR 1,356 billion (₹135,581 crore), up 17% YoY, with strong domestic and international momentum; order book reached INR 7.33 trillion (₹733,161 crore), up 30% YoY, with a 49% international share.

• Group revenues grew 10% YoY to INR 714 billion (₹71,450 crore), with 54% from international markets; recurring PAT rose 31% YoY to INR 44 billion (₹4,406 crore), while reported PAT declined due to a one-time INR 11.9 billion (₹1,191 crore) labor code provision.

• Return on equity improved to 16.5%, up 40 bps YoY; net working capital to revenue ratio improved by 450 bps to 8.2%.

• Notable strategic moves include realty business consolidation, partnerships in defense and nuclear sectors, and rebranding of the data center business.

• Highest ever pre-sales in Realty and record retail disbursements in Financial Services.

Financial highlights

• Projects and manufacturing order inflows at INR 1.16 trillion, up 18% YoY; domestic orders up 30%, international up 7%.

• Group EBITDA margin improved to 10.4% (from 9.7% YoY); projects and manufacturing margin at 8.1%, up 50 bps.

• Cash flow from operations (excluding financial services) at INR 79 billion for Q3, up from INR 21 billion YoY; 9M FY26 at INR 184 billion, up from INR 83 billion YoY.

• Decline in finance cost due to lower borrowing levels and rates; other income increased from higher surpluses and yields.

• Exceptional item of INR 11.9 billion (₹1,191 crore) due to one-time provision for new labour codes.

Outlook and guidance

• Expects to exceed 10% order inflow guidance for FY26, driven by strong nine-month performance and robust pipeline of INR 5.9 trillion.

• Confident of achieving 15% full-year revenue growth, with Q4 expected to see customary execution ramp-up.

• Projects and manufacturing EBITDA margin target of 8.5% for FY26 remains in focus.

• Net working capital to revenue target revised to around 10% by year-end, reflecting improved collections.

• Company aims to capitalize on emerging opportunities through geographic expansion and focus on cost and cash flow management.