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Computation of GDP – conundrums continue Revive development banks... Shaming of Tamils by Tamil farmers at Delhi Streamlining mandatory third party cover Roaring Ro-Ro facility Adharma of opposition politics CII projects higher growth… Chennai and Kolkata miss opportunity to grow as Delhi and Mumbai An enemy’s enemy is a friend TELANGANA at last…BUT More Shakthi to Das’ elbow Permanent secretariat for TN GIM London, London Narayan CIPET hqrs to stay at Guindy – for the present? The balancing act Mu Sigma – is no more Rs.1600 crore paper board plant of TNPL Odisha: spectacular win by Naveen Patnaik Limit foreign borrowings to hi-tech, export potential projects... Tribute – M V Murugappan Naidu’s return augurs well for Seemandhra Telangana in top gear… Quality education through the PPP mode Lesson from Chandrababu Naidu Welcome GST Noble nonagenarians... Intellectual of rare qualities No mega rail project for Tamil Nadu Online not in line with brick and mortar businesses... 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Focus on quality of power - its only around 170-180V Haul over the coal GNS - 100: our first subscriber EEC at the National Media Centre Sweeter prospects for sugar Editor's Says Delhi is distant Road development slows down Valli, they are more marginalised Of course, Gujarat is vibrant Should we change the official year? Not just in-laws (and outlaws); they’ve renowned academics at the helm! Muffled voices for merit… The sea- saw battle continues... CSR and CMI: promise of another Srinivasan Ramanujan... A Grand Finale for SN’s MS centenary at the US… Gay abandon in pricing Preserving for the future Marketing expert Balagopal is no more Reliance’s TV – 18 ready to launch Tamil News Channel Discoms deserve better… IAS invades NDDB... Convulsions in The Hindu Quality silica from Neyveli How Air-India loses customs... The rise and fall of Annamalai University Delhi Chalo... IPL - no surprise this scam L&T- the specialty of special purpose vehicles Whistle-Stop Tour of Raghuram Rajan The power-full Hindujas Things happen by accident and not by design... Sri Lanka votes for change A proud Madrasi Recognition to role of NBFCs.... The Jan Dhan bonanza Colour-Chem’s colourful KRVS Parliament in paralysis... When TN politicians can emulate Kerala's There was flood of milk. Reason: no milk commissioner! Where is Rajaji? Liberal imports idling indigenous capacities Music happens Paytm karo... When the President was rendered homeless… S Ramanathan – a versatile musician, musicologist Towards speedy justice Where a state respects its litterateurs… Cutting the nose to spite the face Put expensive assets created to use... The star of Spencers is no more Maximising the micro pricing … For whom the bell tolls? Nuclear power at the nucleus TIAM turns a full cycle Varuna (rain) in 2015; Vaayu (air) in 2016. Chennai devastated A glass full of corruption MHC should not return to its old indisciplined ways Solar, solar everywhere … Shale gas and its shallow future Scientists urged to take up farmer-oriented research Mersal magnified Remembering Indira Sivasailam... CRS, a jewel among managers, is no more. Another Indian music maestro at the UN The Gulf aviation boom PPP mode for upgrading Corporation Hospitals Rahman at CIC An informal presentation - analytical, forward locking... WTO Meet: resolved to meet again No engine for this car Delhi is distant… Alexa – Talking Wikipedia Silver Years of Madras Musings TN-leverage strength of BHEL, NLC... China invests in India Strengthen the base... Making ‘my Amaravati’... Kudos to NDTV... Robber barons everywhere Come elections, come advertisements... No Maha Koottani in TN... Tribute – Manikam Ramaswami Bihar elections - the Rajaji formula worked He saved millions from starvation... Increasing non co-operation of state leaders A Grand Finale for SN’s MS centenary at the US… An inexplicable neglect Diamond jubilee of Egmore Samskrt School West Bengal: mindless malignancy Kulandai was a giant Why this malaise in medical education? Fortune 500 review More Shakti to resource mobilisation... Airlines in India: cost and space Building loyalty through the stomach More heat than light GM Technology at last! When nations steal growth from one another…
 
L&T- the specialty of special purpose vehicles

A decade ago, engineering and construction giant Larsen & Toubro conceived a bold, new plan: to form separate subsidiaries or special purpose vehicles to focus on new projects. This enabled the company to access and acquire expertise in new areas such as toll roads and bridges, airports, seaports, metro and rail systems.  I remember the foresight and passion with which A Ramakrishna (AR) explained this foray.

Of course, such a pioneering effort, involved certain business risks. AR took efforts to explain the benefits of the toll road concept, which found resistance in the initial period. In quick time, the concept gained acceptance and opened the floodgates for massive expansion of quality road network. With handsome funding by the private sector, road construction recorded growth as never before.

Equally innovative was the lead taken by L&T ECC to form a separate company for the construction of the Bengaluru airport. Its reputation and record were helpful in ensuring participation by reputed global companies. This experience was a big stepping-stone for taking up construction of the much larger airports at Delhi and Mumbai.

Such enterprise extended to form more such companies. The large Dhamra Port in Odisha in partnership with the Tatas is another major venture. K V Rangaswamy who headed the construction division pointed to L&T gaining rich expertise in such diverse fields for engineering and construction, build value and sell its share in such projects to good profit. The company thus derives twin advantages: getting  orders for constructing such large projects and on completion, to sell these at profit.

The L&T Shipbuilding Ltd on which L&T has invested around Rs 4000 crore is another example of a handsome diversification. This project has three components: an engineering unit, shipbuilding cum repair facility and a container port. The present recessionary conditions come in the way of full utilisation of the niche facilities created. With the expected turn around of the economy, the operations would become profitable.

 The construction division had been accounting for around half the revenues of the giant corporation. With the slowdown in the economy affecting the manufacturing sector in the current year, the construction division may account for larger share, of around 75 per cent, of the revenues of the corporation.

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