L&T looks at Korean model for global push

Construction firm plans hubs in the US and Gulf.

Larsen & Toubro (L&T) wants to become what one of its executives describes as the Samsung of the engineering industry.

The Rs 9,800 crore engineering and construction conglomerate is seeking to become a global company by putting in place an international structure, with hubs in the Persian Gulf region and the Americas, and has drawn up a master plan for the purpose, according to K Venkatramanan, wholetime director and president (operations), L&T.

As a first step, it is setting up an engineering base in West Asia. The site is yet to be finalised, but the headquarters for L&T's operations in and around Saudi Arabia, the UAE, Qatar and Africa will be based at this location.

A similar corporate base will be set up in the Americas and an engineering and a design base is being set up in Delhi to cater to the Asian market.

The idea is to place engineering and design talent at these centralised corporate bases. Engineers and designers based at these centres would not only execute existing orders but also seek business on a regular basis, Venkatramanan said. The company already has offices in the US, Europe, West Asia and Japan.

L&T has also embarked on a global corporate brand building exercise by advertising overseas and participating in international exhibitions.

Venkatramanan said: "We have initiated a corporate brand development exercise on global scale. We will like to adopt the Korean growth model. This is a part of our strategy of steamlining our capabilities to meet emerging trends in the engineering and construction industry on a global platform."

He, however, declined to disclose how much L&T was planning to invest in implementing the global masterplan.

The second phase, according to Venkatramanan, entails executing the plan. After conducting a viability study, L&T will set up plants overseas and acquire assets (including perhaps companies) in international locations.

The company currently executes orders from international clients in Malaysia, the US, UK, Brazil, Saudi Arabia, the UAE, Qatar, Bangladesh and Sri Lanka from its corporate headquarters in Mumbai.

The vertically-integrated engineering conglomerate's portfolio includes engineering and construction projects (primarily in the hydrocarbon, power, cement, steel and fertiliser industries), heavy engineering, infrastructure projects and the information technology and electrical and electronic businesses.

---

Giant makeover

Current model

L&T currently serves business from its headquarters in Mumbai

New hub model

Engineering and design talent will be placed in centralised corporate bases in the Middle East, US, India

These engineers and designers will not only execute existing orders but also seek business

Brand building

L&T has embarked on a global corporate brand building exercise by advertising overseas and participating in international exhibitions