L&T Shares Slip 2.5% on Kuwait Tender Uncertainty; Wins Bengal Bridge Order
Overview
Larsen & Toubro shares fell 2.5% on Tuesday, January 13, amid reports Kuwait may cancel $8.7 billion in oil project tenders due to budget overruns. L&T, a low bidder on over $4.5 billion of these, also secured a significant bridge contract in West Bengal, providing crucial all-weather connectivity to Sagar Island.
Larsen & Toubro Ltd. (L&T) shares experienced a downturn on Tuesday, January 13, with the stock declining 2.5% to ₹3,922.2. This slide was primarily attributed to a report from Middle East Economic Digest (MEED) indicating Kuwait's potential cancellation of oil project tenders valued at approximately $8.7 billion.
Kuwait Tender Concerns
According to the MEED report, Kuwait is considering re-bidding these major upstream contracts because the initial bids exceeded budgetary limits. Analysts note that L&T was identified as the lowest bidder for a substantial portion of these tenders, estimated at over $4.5 billion. This news introduces uncertainty into a significant part of the company's potential future order book.
Order Book Strength
Despite the Kuwaiti development, L&T maintains a robust consolidated order book currently standing at ₹6.5 lakh crore. The company had previously set an order inflow guidance for the financial year 2026 that was 10% higher than the preceding fiscal year. CNBC-TV18 has sought comment from L&T regarding the Kuwait situation, with a response pending.
West Bengal Bridge Contract
On a positive note, L&T announced on Tuesday that its transportation infrastructure business secured a "significant" order for an arterial cable-stayed bridge over the Muri Ganga River in West Bengal's South 24 Parganas district. L&T categorizes orders between ₹1,000 crore and ₹2,500 crore as "significant."
The project involves constructing a 3.2km extradosed cable-stayed bridge, including approach roads, and will feature advanced traffic management, health monitoring, and lighting systems. This infrastructure is set to provide vital all-weather connectivity to Sagar Island, currently reliant on weather-prone ferry services, benefiting over 200,000 residents and boosting pilgrimage travel to Ganga Sagar Mela.
