Larsen & Toubro Ltd (L&T), India’s largest technology, engineering, construction and manufacturing company, is to soon realign its electrical and electronics business division (EBG) with its wholly-owned subsidiary in power equipment manufacturing, L&T Power.
The move is to bring more synergy within the group and leverage internal strengths in power and related allied sectors, said Ravi Uppal, chief executive and managing director of L&T Power. “We are working out the details,” he told Business Standard.
The Rs 34,000-crore turnover company recorded sales of Rs 2,638 crore from its EBG division in 2008-09. The division had an order book position of Rs 2,676 crore for 2008-09, according to the annual report. Cumulative power sector orders were in excess of Rs 15,500 crore. In the current financial year, the division is looking at revenues of close to Rs 4,000 crore, said sources.
L&T had last year reorganised its business units under four-five vertical divisions, termed ‘Operating Companies’, with own internal boards, to spur growth and optimise internal resources.
The EBG division, headed by R N Mukhija (president, operations), offers solutions for the power sector in low and medium voltage categories. The EBG comprises an Electrical and Automation Operating Company (EAOC) and two standalone business units of Medical Equipment and Systems and Petroleum Dispensing Pumps and Systems.
Sources said EAOC’s business comprised four strategic business units (SBU) — electrical standard products (ESP), electrical systems and equipment (ESE), metering and protection systems (MPS) and control and automation. ESP and ESE have production base in Powai in Mumbai and at Ahmednagar in Maharashtra, with additional facilities for ESE and a precision manufacturing centre for tooling solutions at Coimbatore in Tamil Nadu.
The control and automation business unit operates from a campus in Navi Mumbai, while metering and protection systems are based at Mysore in Karnataka. It also has international presence through manufacturing facilities in Wuxi (China) for switchgear standard products, at Dammam in Saudi Arabia and at Jebel in the United Arab Emirates.
Ravi Uppal said the Vadodara-based L&T Power is investing close to Rs 3,600 crore in power generation and related sectors at Hazira in Gujarat, now the largest fabrication yard at a single location in the world. L&T Power will augment its existing manufacturing capacity of steam turbine generators and boiler-turbines-generators to 6,000 Mw from the current 4,000 Mw in two years. Investments include Rs 750 crore in boilers, Rs 1,400 crore in forgings, Rs 1,050 crore in turbines and a Rs 120 crore foundry and piping facility.
L&T manufactures boilers, turbines and generators through a three-year-old joint venture with Mitsubishi Heavy Industries, Japan.
The joint venture facilities will be ready for commercial manufacturing by next month. L&T Power has 8,000 Mw of orders at hand and discussions are on with many power project developers. The company has in-house capacity to execute 10,000 Mw (almost half of India’s proposed capacity addition) in the case of Balance of Plant work of thermal power plants.
