Simpler structure, better management
A M Naik CMD, Larsen & Toubro
The Rs 37,034-crore (2009-10 revenues) engineering and construction major Larsen & Toubro is in the throes of a major transition. The company is planning to reorganise its operations into nine business verticals as the conglomerate seeks to simplify its structure to better manage growth. L&T, which has seen intense competition snapping at its heels of late, operates in diverse industries including engineering, power and shipping, but has stepped up its focus on financial services and software businesses in the past few quarters to diversify from its core engineering business. L&T has seen rapid growth in the past few years as India pushes ahead to revamp roads and airports, and to expand industrial capacity.
As per the restructuring plan, power equipment, hydrocarbon, heavy engineering, infrastructure, building and factories, metals and minerals, electrical and automation products, electrical construction, machinery and industrial products segments will make up the nine units. Each of these units will act like independent companies, will have an internal board, and independence to take investment decisions. The business verticals will be in addition to large existing units such as L&T Finance, L&T Infotech and L&T Power Development that would have precedence for listing on stock exchanges.
In an interview with FE, AM Naik, the company’s CMD had said, “Every third year, when we undertake
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