The document analyzes the performance of Larsen & Toubro (L&T), India's largest engineering firm. It conducts a SWOT analysis and examines L&T's financial performance for FY 2010, finding an 8% increase in net sales and 31% increase in net profit. Surveys of 80 investors, management, employees, and other stakeholders find that while results met expectations, employees feel management prioritizes profits over salaries. Comparative ratio analyses of top construction companies show L&T remains well-positioned for future growth, though it could improve employee satisfaction, global presence, and succession planning as top management nears retirement.

1. Amity Business SchoolPERFORMANCE ANALYSIS OF
LARSEN&TOUBRO
Presented by: Abhilash Mishra
MBA GEN
A0101909425

2. Amity Business School
Objectives
• Primary Objective is to do a performance analysis of Larsen &
Toubro with the help of primary and secondary data analysis
• Secondary Objectives
•To analyze the investor’s confidence in the company.
•To analyze the employee confidence in the performance of the company.
•Determine the consumer confidence in the company’s quality of service
as against the competitors.
•To do comparative ratio analysis of top 5 companies in construction sector
including L&T and analyze the results. And to see whether the secondary analysis
results strengthen my primary analysis results.

3. Amity Business SchoolLARSEN & TOUBRO
 India’s Largest Engineering firm
 Founded in 1938 by Henning Holck-Larsen & Soren Kristian
Toubro.
 Employs over 40,000 people in various states across the
country.
 Has presence in various sectors such as
 Headquartered in Mumbai.
 NSE & BSE listed company
 Chairman & Managing Director – Mr. AM Naik

4. Amity Business School
SWOT Analysis
Strengths
Strong Economic growth of country
L&T’s experience in India
Order book of over 100,000 crores
Brand name of Larsen & Toubro
An experienced employee base
Diversified business group
Strong financial results
Weakness
Slowdown in middle east
Average experience
employee age nearing retirement
Huge attrition rate
Low employee satisfaction
Week Global Reach
Lack of Innovation
Opportunities
Major Infrastructure projects
coming up (govt.)
India’s growth rate above 10%
Opportunities from Other
south Asian Countries (less dev)
Global economic recovery
Investment in Defense sector
Threats
Inflationary and cost pressures
Threat of a second
Global Financial Turmoil
Vendor issues
Government policies
Competitors
Taxation policies

5. Amity Business SchoolPerformance – FY’10(Crs)
• Net Sales – 43513 v/s 40187 / 8% up
• Net Profit – 5450 v/s 3789 / 31% up
• Order Book – Over 100,000 crores / 43%
up
• Dividend – 12.50/ share
• Major growth in E&C segment

6. Amity Business SchoolResearch Methodology
• Data was calculated through question method.
• SAMPLE SIZE: 80
• TYPE OF SAMPLING:
• STRATIFIED RANDOM SAMPLING
• STRATA DISTRIBUTION:
• STRATA 1 - Investors (20 people)
• STRATA 2 - Management (Larsen& Toubro) (20 people)
• STRATA 3 - Employees (20 people)
• STRATA 4 - Other Stakeholders’ (20 people)

7. Amity Business SchoolAnalysis of performance
• Management’s Feedback
• Employee’s Feedback
• Investor’s Feedback
• Client’s Feedback

8. Amity Business SchoolManagement Feedback
• Results are in line with expectations.
• Results have met shareholder’s expectations.
• Somewhat compromised on employee salary to
maintain good profitability.
• Management is Positive & Bullish about the
future growth of the company.

9. Amity Business SchoolEmployee Feedback
• Employee’s have rated the company’s results as good and
somewhat in line with expectations.
• They have rated management performance as average.
• ESOP scheme was praised as it has yielded good returns
for employees
• Employee’s feel that management is cutting down on
salaries to maintain profitability

10. Amity Business SchoolInvestor’s perspective
• Company’s year end results are in line with Investor’s
expectation
• Investor’s see a similar growth pattern for L&T in coming
years.
• Investor’s are impressed by management performance
during the year.
• Investor’s have rated L&T a better option to invest when
compared to competitors.

11. Amity Business SchoolClient’s Feedback
• L&T is running high on customer satisfaction and the
client’s are happy with the quality of service
• When compared to competitors, the quality is as per the
standard.
• L&T ranks well in terms of time deadlines.
• Client’s feel that L&T is quite innovative while performing
projects.

12. Amity Business SchoolProfit – Last 5 years

13. Amity Business SchoolNet Sales – Last 5 years

14. Amity Business SchoolData Collection Methods
• Financial Websites – Bloomberg/Factiva
• Questionnaires
• Personal Interaction
• Annual Financial report – 2009 – 10
• Analyst’s views on – Moneycontrol.com/ rediff.com
• All five companies website.

15. Amity Business SchoolRecommendations
• Needs to work on Employee Satisfaction.
• Attrition rate is huge – Some mechanism is required
• Needs to work further on Client Satisfaction.
• Try to build an international image.
• Salary structure needs a revision .
• Subsidiaries require more attention – Infotech & L&T Finance.
• Plan for future as top management is nearing retiring age.

16. Amity Business School