Larsen & Toubro Ltd. on Monday carved a separate business vertical for renewable energy, out of its power transmission and distribution business within its infrastructure projects segment.
The company wants to enhance management visibility and ensure seamless integration of resources and capabilities for its renewable engineering, procurement, and construction business, it said.
L&T Senior Vice President, A Ravindran, has been appointed as the head of the renewable vertical.
The company is a major player globally with a vast portfolio of 22 gigawatt-peak of renewable EPC. In addition to ground mounted solar, floating solar and wind balance of plant projects, L&T’s battery energy storage system implementation aggregates to 3 gigawatt-hour.
The company is pursuing major projects domestically and in the Middle East.
"The growth of renewable EPC business has accelerated in recent years. Creation of this vertical will give increased autonomy, customer proximity and leadership oversight to the business and enable us to excel in this space," said SN Subrahmanyan, chairman and managing director of the company.
The company's order pipeline from the infrastructure segment stood at Rs 6 lakh crore, followed by energy transition (Rs 2 lakh crore) as of June.
Renewable energy sector is poised for faster growth in India and abroad as countries step up the pace for transition away from polluting fossil fuels. India aims for 500 GW of renewable energy installed capacity by 2030 and has an ambitious goal of net zero emissions by 2070.
Shares of L&T fell 0.6% before paring loss to trade 0.44% lower at Rs 3,688.45 at noon, compared to a 0.21% advance in the NSE Nifty 50.
The stock has risen 36% in the last 12 months and 7% year-to-date. The relative strength index was at 56.
Thirty of the 35 analysts tracking L&T have a 'buy' rating on the stock, three recommend a 'hold' and two suggest a 'sell', according to Bloomberg data. The average of 12-month analysts' price targets implies a potential upside of 8%.
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