Larsen and Toubro CEO and MD SN Subrahmanyan: Private sector spending to revive in 2019

Private sector spending should come back on track in 2019, SN Subrahmanyan, CEO and MD of Larsen and Toubro, said on Monday. Speaking to a business news channel, Subrahmanyan said L&T’s working capital cycle has taken a beating is partly because private sector investments had gone into a shell over the previous two-three years and also owing to increased dependence on government projects which at times have financial hold backs for a minimum three months to clear. The company’s working capital cycle has jumped to 22%. “Earlier, L&T depended 60% on government projects and 40% on private. But over the last 2-3 years, it has become 80-85% government and 10%-15% private. The situation could ease a little by 2019,” he said. He, however, added that the shoot-up in the working capital cycle on account of the GST is temporary and it will start easing out from the second half of FY18. Meanwhile, L&T has bagged a major portion of one of Mumbai’s showpiece infrastructure projects – Mumbai Trans-Harbour Link – a 21.8-km-long bridge to be built over the sea linking the island city of Mumbai with the satellite township of Navi Mumbai. The order is worth `8,650 crore.

Larsen & Toubro Limited