Larsen & Toubro share price falls around 2% despite its Energy Business bags large contract from IOCL

Shares of Larsen & Toubro dropped around two per cent in BSE intraday on Monday even as the company said that it's Hydrocarbon-Onshore division of L&T’s Energy Business has bagged a 'large' contract from Indian Oil Corporation (IOCL). Shares remained in line with the market mood and corrected 1.9% to Rs 1897.35 in the afternoon trade despite the company securing contract from IOCL.  

"L&T earlier bagged a significant EPCC Contract for setting up DHDT Unit (5.0 MMTPA, licensed by Shell) under the same P-25 Project of IOCL at Panipat-Refinery," it said in a regulatory filing on Monday.  

IOCL is implementing the Panipat Refinery Expansion (P-25) Project to enhance refining capacity from 15 MMTPA to 25 MMTPA to meet the growth in demand of petroleum products and to increase their profitability and competitiveness in the long run.  

“We are very delighted to be part of this large expansion project of IOCL-Panipat. I would like to thank IOCL for having trust in our capabilities. We are fully committed to delivering the complex process units with high standards of HSE and Quality,” said Subramanian Sarma, Whole-time Director & Sr. Executive Vice President (Energy) said,. 

The engineering, procurement, construction, and commissioning (EPCC) contract is forsetting up a Residue Hydrocracker Unit (RHCU) for this P-25 Project. The RHCU is licensed by Axens (France) with a capacity of 2.5 MMTPA and will upgrade the Vacuum Residue (VR) to high-value commercial products (mainly diesel). The contract is awarded through international competitive bidding on a Lump Sum Turnkey (LSTK) basis. 

The Hydrocarbon business of L&T Energy organized under Offshore, Onshore, Construction Services, Modular Fabrication and Advanced Value Engineering & Technology (AdVENT) verticals, offers integrated design-to-build solutions to domestic and international customers.