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LT Sacked around 14,000 Employees on Poor Business Growth Due to certain economic challenges, Larsen & Toubro (LT) has sacked around 14,000 employees all over businesses during April—September period this year. LT cited that this step was required in order to stay “agile and competitive“. Since the business is not in good position, they are making an attempt to resize it. If the business turns normal again, it is important to cut the under recoveries. Hence, the employees were asked to move on if their positions were found unnecessary at this point of time. LT used to boast of employee base of 1.2 lakh across various businesses, and they have dismissed 14,000 people during the first half of fiscal 2017. The financial services have defocused on different lines of businesses and let go a lot of people. Same is the case in minerals and metals. R Shankar Raman, Chief Financial Officer further added that the company has tried to look at its businesses in a different way in order to remain competitive. They have incorporated various initiatives to be competitive. Furthermore digitization has been introduced whenever necessary, so in case if they needed 10 people for a job they tried to bring it down to five. The layoffs have been done in businesses which are showing sluggish movement because of various reasons including delayed execution, among others. The company has tried to make its back offices more digital. There are certain low performers (businesses) and LT has to re—look at them. In the competitive world, one needs to be agile and smart and move forward. He, however, mentioned this was a onetime decision and not a target that it has set for laying off people.

L&T Q2 nos During the first half of FY17, the company’s revenue rose 8.6 per cent to Rs 46,885 crore. Profits increased to Rs 2,044 crore from Rs 1,197 crore a year ago. It registered 84 per cent rise in net profit for the 2nd quarter ending September 30, because of a one-time gain from the divestment of the General Insurance business.

Recently, L&T announced its five year strategy to scale up revenues to Rs 2 lakh crore. The plan saw some non performing businesses which the company is now relooking at. L&T’s revenue growth for the September quarter was driven by its international operations. While the company’s power and heavy engineering segment put up a good show, its infrastructure segment which contributed close to 44 per cent of its revenue and more than 70 per cent of its order book faced a lacklustre performance. Intraday on Thursday, LT share price settled above 1 per cent at Rs. 1357.25. The stock was trading at Rs. 1353.90. LT is one of the top 500 performing stocks for this quarter as identified by Dynamic Levels.

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Article Written by Madhurima Chowdhury

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