Larsen & Toubro (L&T) is aggressively expanding its defence business, aiming to transform it into a multi-billion dollar segment, building on a robust order book of ₹6,185 crore (approximately $726 million) in the previous fiscal year.

This strategic move aligns with the Indian government’s ambitious push to modernise and indigenise the country’s military capabilities, targeting ₹30,000 crore in defence exports this fiscal and ₹50,000 crore by FY29, alongside a domestic defence production goal of ₹1.6 lakh crore in FY26, nearly doubling to ₹3 lakh crore by FY29.

L&T’s defence portfolio is broad, encompassing the manufacture of warships, patrol vessels, armoured vehicles, artillery guns, and missile systems. The company has played a pivotal role in high-profile projects such as the design and construction of INS Arihant, India’s first indigenously designed and built nuclear-powered ballistic missile submarine, and has recently launched multi-purpose vessels for the Indian Navy from its Kattupalli Shipyard in Chennai.

L&T is also constructing cadet training ships and other naval vessels, demonstrating its end-to-end shipbuilding capabilities, which include in-house design, modular construction, and lifecycle management.

The company’s order intake in the defence sector surged to ₹13,326 crore last fiscal, marking a 29% growth, primarily driven by repeat orders for the K9 Vajra-T self-propelled howitzers. L&T is set to deliver an additional 100 K9 Vajra-T units to the Indian Army by the end of 2025, further cementing its role in India’s artillery modernisation.

Its state-of-the-art shipyards and design centres enable the company to deliver frontline warships, submarines, and specialised platforms, supporting both Indian and friendly foreign navies.

L&T’s leadership sees vast potential in the defence sector, contingent on government willingness and policy support. R Shankar Raman, L&T’s president and CFO, emphasised that the sector could become as large as the government’s commitment allows, with a focus on filling shipyards with defence orders and expanding capacity as needed.

The company is also capitalising on the government’s recognition of the need for greater private sector participation to accelerate military upgrades, especially in light of the capacity constraints and order backlogs at state-run defence firms.

Internationally, L&T is poised to benefit from the global realignment of defence supply chains, driven by geopolitical conflicts such as the Russia-Ukraine war, which have disrupted critical supply routes and increased costs for defence contractors.

The company is also investing in technology and innovation, creating a ₹200-crore corpus for start-up investments, particularly in defence applications such as launching systems, radars, and traction devices. L&T is open to partnering with start-ups in areas like power and load management, leveraging the growing ecosystem of defence tech innovation in India.

Additionally, L&T is targeting a 20% market share in the nuclear power segment, aligning with the government’s Nuclear Energy Mission, which has allocated ₹20,000 crore for research, development, and deployment of Bharat Small Modular Reactors. The company’s collaborative approach includes partnerships with global technology leaders and Indian academia, further strengthening its R&D capabilities and future product pipeline.

L&T’s strategy to ramp up its defence business is underpinned by strong government support, a comprehensive manufacturing and design ecosystem, robust order growth, and a proactive approach to innovation and international collaboration. These factors position L&T to emerge as a leading player in India’s journey toward self-reliance and global competitiveness in defence manufacturing.

Based On ET News Report