Larsen & Toubro Limited

Strong growth across orders + improving cash/work capital (good, investor-positive) - Q3 FY’26 order inflows hit a record INR 1,356 bn (+17% YoY) — led by Projects & Manufacturing (P&M) at INR 1,164 bn (+18% YoY). - P&M domestic orders INR 620 bn (+30% YoY); international INR 544 bn (+7% YoY). - Prospects pipeline (near-term) up to INR 5.92 tn (+7% YoY); order book INR 7.33 tn (+30% YoY). - Working capital improved sharply: NWC-to-sales improved to 8.2% (Dec’25) from 12.7% (Dec’24); group cash flow from operations (ex-financial services) INR 79 bn in Q3 vs INR 21 bn prior year.

Margins: solid at group level, but a key pain point persists in Hydrocarbons (mixed; risk to watch) - Group EBITDA margin (ex other income) improved to 10.4% vs 9.7% YoY; P&M EBITDA margin at 8.1% (~+50 bps YoY). - Recurring PAT Q3 INR 44 bn (+31% YoY), but reported PAT INR 32 bn (-4% YoY) due to a one-time INR 11.9 bn impact from new Labour Codes legislation. - Energy segment margin pressure: Energy margin fell to 5.9% vs 8.3% YoY, mainly due to cost overruns in a few Hydrocarbon projects in “terminate execution” phase. - Management expects Hydrocarbon margins to improve after closure of stressed projects: commentary suggested margin recovery could be 2–3 quarters forward and guidance already factors softness.

Guidance for FY’26 remains intact; revenue confidence supported by execution ramp in Q4 (forecast/outlook) - Order inflows: expects >10% growth for FY’26, relying on strong prospects pipeline and CapEx momentum. - Revenue: maintains full-year revenue growth guidance of ~15% (despite 9M revenue growth being ~10–12%); confidence because Q4 is typically the busiest execution quarter. - Margins: P&M EBITDA target 8.5% for FY’26; 9M P&M EBITDA margin 7.9% “in line” with path to target. - Working capital: earlier target was ~12% NWC/sales by March’26; revised expectation ~10% given stronger collections (8.2% already by Dec’25).