Description
SWOT ANALYSIS OF LARSEN &TOUBRO
Larsen & Toubro
Parent Company
Larsen & Toubro
Category
Construction Services
Sector
Conglomerates
Tagline/ Slogan
It’s all about Imagineering
One of the largest and most respected companies in India for engineering, manufacturing and integration of custom made USP technology-intensive equipment and systems STP
Based on business type; Based on geography – India, Rest of Asia, Segment the Americas, Africa, Europe, Australia
Technology, engineering, construction and manufacturing projects Target Group Predominantly targets Indian projects
Positioning
A company that focuses on technology leadership SWOT Analysis
1. Market leadership providing competitive edge - The company can leverage its strong brand name and market leadership position to gain competitive advantage and also expand into international markets 2. Strong technical expertise reinforce leadership position - L&T has set up an engineering and project management centre in Abu Dhabi to undertake oil and gas related projects as well as engineering and consultancy services 3. Diversified revenues providing resilience - In FY2011, the company’s revenues were distributed among business divisions as follows: engineering and construction, electrical and electronics, Strength machinery and industrial products, financial services, developmental projects and others. This enables L&T to alleviate its business risk as
fluctuations in a single offering have lesser impact on diversified offerings and provide resilience to its revenues 4. Over 45,000 employees form a part of its workforce 5. It has offerings like Construction, Heavy equipment, Electrical equipment, Power, Shipbuilding, Financial services and IT Services
1. Dependence on domestic operations for revenue generation - In FY2011, the company's domestic (India) operations contributed more than 80% of the total revenues. 2. Increasing debt impacting financial flexibility - L&T’s interest and Weakness brokerage expenditure over the period increased
1. Strategic joint ventures strengthening business - L&T has formed a strategic partnership with Cyan Holdings plc, a UK-based integrated system design company. L&T and Cassidian entered into a partnership in February 2011, to become an electronics house for defense and security 2. Strong project pipeline ensures revenue growth 3. Growing Indian construction & engineering industry - In 2015, the Opportunity Indian construction & engineering industry is forecast to grow
1. Rise in cost of construction may affect margins - The rise in crude prices, will increase the cost of transportation. 2. Challenges in land acquisition likely to affect business - in 2011, Indian government introduced ‘The Land Acquisition, Rehabilitation and Resettlement Bill, 2011’. As per the bill, compensation fo r the owners of the acquired land shall be four times the market value in rural areas and twice in urban areas 3. Intense competition may reduce profitability – few competitors have substantially greater resources and superior capabilities than Threats L&T Competition
1. ABB 2. Bechtel 3. Hindalco Competitors 4. Sundaram Fasteners
5. Gammon India 6. Lanco Infratech
doc_521779694.docx
SWOT ANALYSIS OF LARSEN &TOUBRO
Larsen & Toubro
Parent Company
Larsen & Toubro
Category
Construction Services
Sector
Conglomerates
Tagline/ Slogan
It’s all about Imagineering
One of the largest and most respected companies in India for engineering, manufacturing and integration of custom made USP technology-intensive equipment and systems STP
Based on business type; Based on geography – India, Rest of Asia, Segment the Americas, Africa, Europe, Australia
Technology, engineering, construction and manufacturing projects Target Group Predominantly targets Indian projects
Positioning
A company that focuses on technology leadership SWOT Analysis
1. Market leadership providing competitive edge - The company can leverage its strong brand name and market leadership position to gain competitive advantage and also expand into international markets 2. Strong technical expertise reinforce leadership position - L&T has set up an engineering and project management centre in Abu Dhabi to undertake oil and gas related projects as well as engineering and consultancy services 3. Diversified revenues providing resilience - In FY2011, the company’s revenues were distributed among business divisions as follows: engineering and construction, electrical and electronics, Strength machinery and industrial products, financial services, developmental projects and others. This enables L&T to alleviate its business risk as
fluctuations in a single offering have lesser impact on diversified offerings and provide resilience to its revenues 4. Over 45,000 employees form a part of its workforce 5. It has offerings like Construction, Heavy equipment, Electrical equipment, Power, Shipbuilding, Financial services and IT Services
1. Dependence on domestic operations for revenue generation - In FY2011, the company's domestic (India) operations contributed more than 80% of the total revenues. 2. Increasing debt impacting financial flexibility - L&T’s interest and Weakness brokerage expenditure over the period increased
1. Strategic joint ventures strengthening business - L&T has formed a strategic partnership with Cyan Holdings plc, a UK-based integrated system design company. L&T and Cassidian entered into a partnership in February 2011, to become an electronics house for defense and security 2. Strong project pipeline ensures revenue growth 3. Growing Indian construction & engineering industry - In 2015, the Opportunity Indian construction & engineering industry is forecast to grow
1. Rise in cost of construction may affect margins - The rise in crude prices, will increase the cost of transportation. 2. Challenges in land acquisition likely to affect business - in 2011, Indian government introduced ‘The Land Acquisition, Rehabilitation and Resettlement Bill, 2011’. As per the bill, compensation fo r the owners of the acquired land shall be four times the market value in rural areas and twice in urban areas 3. Intense competition may reduce profitability – few competitors have substantially greater resources and superior capabilities than Threats L&T Competition
1. ABB 2. Bechtel 3. Hindalco Competitors 4. Sundaram Fasteners
5. Gammon India 6. Lanco Infratech
doc_521779694.docx