Shares of Larsen and Toubro (L&T) advanced over 4% on the news report that the company is eyeing to bag defence contracts worth Rs 40,000 crore.
Shares of Larsen and Toubro (L&T) advanced over 4% on the news report that the company is eyeing to bag defence contracts worth Rs 40,000 crore. The stock of the diversified conglomerate rose as much as 4.93% to the day’s high of Rs 1,182. L&T opened 0.48% higher today at Rs 1,132 on BSE. More than 50 lakh shares of L&T have been traded so far on both BSE and NSE. At the last traded price of Rs 1,173.05, L&T has added Rs 6,520 crore to Rs 1,64,291 — in its market capitalisation.
L&T is hopeful of bagging some six contracts amounting to Rs 40,000 crore, The Hindu Business Line reported citing Jayant D Patil, Whole-time Director and Senior Executive Vice-President (Defence Business). As the government is now more keen on developing the defence sector and is increasingly willing to meet desired requirements on time, it will likely bring more contracts for private sector defence players.
“If one compares a defence shipyard with a private sector, the shipyard relies on 75% import content and despite that the project is delayed. A private company could do it much faster and make it far larger with 75-80% indigenous content. Hence, it was imperative to involve the private sector,” Patil said in an interview to The Hindu Business Line.
Earlier in July 2017, the Narendra Modi government had delegated “substantial” financial powers to the Army, the Navy and the Indian Air Force to strengthen perimeter security at sensitive military installations across the country. Then Defence Minister Arun Jaitley has fixed strict timelines to ensure that the works are undertaken on priority and in a time-bound manner to ensure full security at the critical defence assets. The vice-chiefs of the three services have been empowered to place orders, procure equipment and carry out civil works without seeking approvals of the defence ministry.
Meanwhile, Sensex and Nifty which opened marginally higher after yesterday’s muted activity are trading almost flat in the early afternoon session on Friday. BSE Sensex was trading down 0.01% at 31,691.32 points while NSE Nifty was trading up 0.06% at 9,935.7 points. The benchmark Sensex added over 101 points to hit the day’s high of 31,763.7 points while Nifty 50 made it at 9,963.6 points.