Subrahmanyan will taking over the reins of the company when it faces certain crucial challenges
Image: Shailesh Andrade / Reuters
A succession plan that had been put in motion at engineering conglomerate Larsen and Toubro (L&T) will culminate in SN Subrahmanyan taking over as the company’s chief executive officer and managing director on July 1. He will succeed AM Naik, L&T’s iconic leader who will hang up his boots after serving the company for five decades.
Naik, who is currently L&T’s executive group executive chairman, will assume the role non-executive chairman on October 1 for a period of three years.
“Taking into account the need for seamless transition of leadership in an organisation of the scale and complexity of L&T, the board of directors requested Mr. Naik to provide advice, guidance and mentorship to the company’s executive management in the capacity of non-executive chairman,” the company said in a statement issued Friday after market hours. Naik’s term as group chairman ends on September 30.
Subrahmanyan, who joined the L&T in 1984 and rose through the ranks to be appointed deputy managing director in 2015, was handpicked by Naik as his successor and mentored by the septuagenarian business leader personally.
“Mr. Subrahmanyan is a top-notch professional of outstanding ability and commitment,” Naik said in a statement. “Across the last ten years, and especially after he was identified as the likely successor three years ago, I have been personally mentoring Mr. Subrahmanyan and grooming him for the enlarged responsibilities of the CEO. I am confident that under Mr. Subrahmanyan’s high claibre leadership, the company will accelerate its growth momentum and continue to play a vital role in building the nation.”
Under Naik’s leadership (he was appointed L&T’s CEO in 1999 and chairman in 2003), the $16 billion-conglomerate – with interests ranging from infrastructure services, hydrocarbons and construction to realty, financial services and information technology – progressively entered new lines of businesses and diversified itself. The company’s market capitalisation, under Naik’s leadership rose from Rs4,400 crore in 1999 to Rs1.58 lakh crore in 2017. Naik is credited with helping L&T expand its operations outside India, with international markets now accounting for around 35 percent of the company’s consolidated turnover.
“Mr. Naik has been the soul of L&T, and has given his whole life to L&T. We are delighted that he has agreed to continue to help the company for the next three years,” said Subodh Bhargava, chairman of the L&T boards’ nomination and remuneration committee in a statement.
Subrahmanyan will taking over the reins of the company when it faces certain crucial challenges. The company. At the end of the third quarter of fiscal 2017, L&T revised its order inflow guidance downwards due to several headwinds in India - with a delay in revival of domestic growth - and overseas – with challenges in specific verticals such as oil and gas.