L&T Wins Ultra-Mega Gas Compression Contract Worth Over ₹15,000 Crore

Larsen & Toubro (L&T) announced on Monday that it has secured an "ultra-mega" contract valued at more than ₹15,000 crore for a gas compression facilities project in the Middle East. The order, confirmed through an exchange filing, will be executed by the company's engineering, procurement, and construction (EPC) arm, L&T Energy Hydrocarbon Onshore (LTEH Onshore), against a letter of award issued in FY26.

The project involves the EPC of gas compression plants, including gas inlet facilities, gas compression systems, condensate and produced water handling systems, propane refrigeration systems, and all related utilities. These facilities will be developed for new onshore installations designed to process sour gas, in compliance with applicable client standards, codes, and project requirements.

L&T has not disclosed the exact value of the contract or the identity of the client. The company categorises orders exceeding ₹15,000 crore as "ultra-mega" contracts. One of the sources noted that MEED reported a link between the project and Saudi Aramco's Jafurah unconventional gas development, though L&T itself has not confirmed this.

Scope and Infrastructure

To support the power needs of the gas compression plants, L&T's Power Transmission & Distribution business will construct two 230 kV extra-high-voltage substations as part of the project. This brings together the group's hydrocarbon engineering capabilities with its power transmission expertise, allowing for integrated delivery of both the core gas-processing infrastructure and its associated high-voltage power systems.

Commenting on the development, E S Sathyanarayanan, Senior Vice President and Head of L&T Energy Hydrocarbon Onshore, said: "The contract marks the start of a strategically important project that will add significant gas compression capacity and utility infrastructure. The project draws on our extensive experience in executing large and complex hydrocarbon facilities and reinforces our capability to deliver integrated solutions for challenging sour gas applications."

LTEH Onshore is one of India's largest EPC businesses, offering Lump Sum Turnkey solutions across the upstream, midstream, and downstream hydrocarbon sectors. Its project portfolio includes refinery expansions, petrochemical complexes, gas processing plants, fertiliser plants, LNG terminals, and cross-country pipelines across multiple markets.

Market Context and Recent Orders

The announcement comes as L&T continues to build its order book. According to CNBC TV18, this is the company's third ultra-mega order in August. Earlier this month, a consortium comprising L&T and Japan's Mitsubishi Heavy Industries secured a "large" order, valued between ₹2,500 crore and ₹5,000 crore, to design and build an automated people mover system for Phase 1 of Al Maktoum International Airport in Dubai.

Additionally, LTEH Offshore previously won an ultra-mega order worth over ₹15,000 crore from a major Middle East client for the development of multiple offshore facilities.

Shares of L&T saw mixed reactions in Monday's trading. Business Today reported that the stock rose 0.44% to a high of ₹4,106.40, while The Hindu Business Line noted that shares were trading at around ₹4,083.50, down 0.11%. Outlook Business put the share price at ₹4,100 at 9:55 am. By the close, The Economic Times reported the stock ended nearly unchanged at ₹4,085.30 on the BSE.

Analyst sentiment remains largely positive, with CNBC TV18 reporting that out of 32 analysts covering the company, 81.3% hold a "buy" rating, five have a "hold," and one recommends a "sell." JP Morgan has an "Overweight" rating with a target price of ₹5,060, the highest among analysts.

The stock has declined by roughly 4% over the past six months and is currently trading about 7.8% below its 52-week high of ₹4,440.

Recent Order Wins

L&T has been active in securing large contracts. The gas compression project is the latest in a series of wins, including the Dubai airport APM system and earlier orders in July. The company's ability to secure multiple ultra-mega contracts underscores its strong position in the hydrocarbon and infrastructure sectors, particularly in the Middle East region.