L&T Said To Emerge As Lowest Bidder For Chennai’s Two Metro Projects
Larsen & Toubro Ltd. employees work in the heavy engineering division in Hazira, India. (Photographer: Prashanth Vishwanathan/Bloomberg News)

L&T Said To Emerge As Lowest Bidder For Chennai’s Two Metro Projects

Larsen & Toubro Ltd. has emerged as the lowest bidder for two metro projects in Chennai, together worth Rs 3,500 crore, according to a person aware of the details.

India’s largest engineering and construction company has emerged as the lowest bidder for constructing the 7.9-km elevated package from Porur Junction to Poonamallee Bypass of Chennai Metro’s new 26.09-km line-4, the person said on the condition of anonymity. Besides viaduct, the project scope includes construction of elevated metro stations at the Chennai bypass crossing, along with eight other stations, and a depot-line to a train maintenance depot at Poonamalee.

Three companies — L&T, Hindustan Construction Co.-KEC International Ltd. joint venture and NCC Ltd. — had participated in the tender. This is the second elevated package of line-4 for the upcoming 118.9-km Chennai Metro Phase 2 project.

L&T had also qualified as the lowest bidder for the first package in December 2020, the person quoted above said.

The company has also emerged as the lowest bidder to construct 42 track km of underground tunnels for Chennai Metro’s new 45.81-km line-3. The scope of this project includes partial diaphragm and entry/exit structural work at eight stations. Besides L&T, the other bidders were Tata Projects Ltd. and Turkey-based Gulermak.

The rest of the station work will be carried out through five dedicated packages, for which bidding is currently underway, the person quoted above said.

L&T has yet to respond to BloombergQuint’s emailed queries.

“As we enter peak awarding season in the coming months, we expect flattish growth in [L&T’s] core E&C/overall order inflows compared to earlier expectation of a decline of 20% and 14%, respectively,” Motilal Oswal said in a Jan. 19 note. “While certain large-ticket size orders may have a longer execution period, its strong order book position and low base of FY21 would help in clocking over 15% revenue CAGR over FY21-23.”

Shares of L&T gained as much as 2.5% to trade at their 52-week high of Rs 1,396.4 apiece. The company will report its results for the October-December period post-markets today.

Of the 41 analysts tracking the company, 38 have a ‘buy’ rating, two suggest a ‘hold’ and one recommends a ‘sell’. The average of Bloomberg consensus 12-month price targets implies an upside of 1.1%.

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