S N Subrahmanyan, who takes over as MD and CEO of engineering and construction giant Larsen & Toubro today, has big shoes to fill — that of his mentor A M Naik, who, after a 52-year career at the company, will continue as Group Executive Chairman till his tenure ends on September 30.
57-year old Subrahmanyan has been working with L&T for 33 years now, starting his career with the company as a project planning engineer in 1984. Subrahmanyan carries on the legacy of his long serving predecessor, who also took over as the CEO in 1999 after being with the company for 34 years, and reportedly never looked for another job during his entire tenure at L&T.
Subrahmanyan, who has to his credit the multifold growth in L&T’s construction business, elevating it to rank as the the largest EPC player in the country and among the top 25 contractors globally, might need to address some immediate challenges arising out of a sluggish economic environment.
Subrahmanyan has to deal with slowing execution and delay in major projects amid weakening capital expenditure trend across private and public sector. All this, while keeping in sight Naik’s goal of doubling the company’s revenue to Rs 2 lakh crore by the year 2021 and achieving an order inflow over Rs 2.5 lakh crore per year, and that too, without compromising on margins.
On the other hand, Subrahmanyan is standing on the cusp of great opportunities in several sunrise areas too, which L&T is well-placed to capitalise, provided the company tackles some issues around the sale of non-core assets, according to analysts quoted in a report published in the Financial Express.
Given its balance sheet strength and operational experience, L&T has a sharp edge over the competition to take large orders and execute big projects, placing it in a comfortable position to participate in infrastructure development such as highways, railways, power and urban, and also in new opportunities in defence, transportation and smart cities.
Dharmesh Mehta, MD and CEO, Axis Capital, said to the Financial Express: “India is at a cusp of change and the kind of growth needed in infrastructure to fuel that, who other than L&T is better placed to take that opportunity.” Subrahmanyan would have his eyes set at securing the company’s growth in these new sunrise sectors, which will drive India’s next phase of growth and development, just as the company grew as the nation progressed during Naik’s tenure.
Naik himself transformed L&T into an over Rs 1 lakh crore group with presence not only in engineering and construction but also expanding its business in technology, manufacturing and financial services and operations in over 30 countries. Now, Subrahmanyan, who carries the torch forward has the task to scale another milestone and lead the next phase of transformation. To this end, he must continue to find new projects in India’s economic development, and execute those with the same old rigour of his mentor and himself.