Can L&T Ride India’s Nuclear Revival?

India's Pivot To Small Nuclear Reactors Is A Win For L&T

By Amritha Pillay

What? 

In April, India announced that it had marked a major milestone as its indigenously designed and built Prototype Fast Breeder Reactor (PFBR) at Kalpakkam in Tamil Nadu had successfully attained its first criticality. 

Larsen & Toubro (L&T), India’s largest engineering conglomerate, helped build this. 

For L&T, nuclear energy has been a long-awaited story. Its nuclear venture dates back to the 1960’s, with periodic bursts of work, but longer spells of lull. 

The past year has been a tale of two comebacks – India is trying to catch up on lost time on nuclear energy expansions. And in this thrust to expand nuclear energy, India is aiming to achieve a global comeback of fast breeder reactors. As India plans a trillion rupees per annum worth of comeback for nuclear energy, L&T stands to gain significantly. 

Driven by India’s ambitious target to scale its nuclear capacity to 100 GW by 2047 and new policy reforms like the SHANTI Act of 2025, L&T stands to significantly revive its long-dormant nuclear manufacturing segment.

“In recent years, nuclear energy in India has attracted growing interest from large business groups due to a combination of policy visibility, demand-side shifts, and structural changes in the energy system,” Vikas Gaba, Partner and National Head - Power and Utilities, KPMG in India, told The Core. 

Why?

By strictly focusing on high-margin engineering, procurement, and construction (EPC) services rather than asset ownership, the conglomerate is uniquely positioned to capitalise on this trillion-rupee annual market while insulating itself from the financial risks typical of the sector.

L&T has been explicit in its interest in building but not owning or operating nuclear power assets. This EPC focus, industry experts suggest, could help the engineering giant build profits, where the economics of it are yet to turn favourable otherwise. 

L&T’s nuclear ambitions have been languishing for long, while the others, such as hydrocarbons and infrastructure, have galloped. Galloped fast enough for L&T to have the largest order book in the country of more than Rs 7.4 trillion. 

Anil V Parab, whole-time Director & Senior Executive Vice President (Heavy Engineering & Manufacturing) at L&T, puts the likely opportunities at an industry level in plain numbers. 

“This (100 GW by 2047) will translate into approximately Rs 1 lakh crore of investment annually till 2047,” Parab told The Core. 

Parab said he expects L&T’s nuclear business share in its overall order book to grow, he said, “L&T will continue to be the leader and industry trendsetter.” 

The nuclear energy sector in general, and the fast-breeder reactor in particular, both come with their own set of challenges. Fast breeder reactors were attempted in a couple of European countries more than five decades ago, but failed to succeed. 

Since the 1960s, L&T has come a long way in establishing its EPC dominance. Its nuclear workshops were also built through investments made more than a decade ago at Hazira.

It now waits for the boom.

11,041

That’s how many H-1B visas of Indian IT workers the US approved between January and March 2026, according to data published by the US Citizenship and Immigration Services (USCIS). That’s a 40% drop year-on-year.

By The Numbers: The decline hit most major Indian IT firms hard. Tata Consultancy Services (TCS) saw approvals fall 53%, while Wipro and Tech Mahindra posted declines of 62% and 59%, respectively. Infosys bucked the trend, recording a 12% increase.

The drop comes amid tighter US immigration scrutiny, rising visa costs, and stricter compliance requirements that have made companies more selective about new filings. Higher local hiring in the US and a broader slowdown in tech hiring have also reduced demand for H-1B visas.

What This Means Going Forward: Uncertainty may persist for Indian tech workers. The Trump administration’s tougher immigration stance and enhanced vetting measures could further complicate the path from H-1B visas to permanent residency.

India Tallies War's Toll

India's economy is under growing pressure from the West Asia conflict, with Finance Minister Nirmala Sitharaman warning of surging foreign exchange outgo due to high crude oil, fertiliser and gold prices, Reuters reported. Prime Minister Narendra Modi had earlier called on Indians to conserve fuel and foreign exchange, with Sitharaman describing the appeal as "very important" amid the crisis.

Flashpoint: Indian refiners have reportedly scrambled to replace disrupted Middle East supplies, turning to Latin America and Africa after the Israeli-US war on Iran restricted shipping through the Strait of Hormuz. Overall oil imports fell 15.5% in April from a year earlier, though volumes held steady from March at 4.57 million barrels per day.

Critical Moment: Diplomatic prospects offered little immediate relief. US Secretary of State Marco Rubio, visiting New Delhi, said Washington would pursue diplomacy but would deal with Iran in "another way" if talks failed.

Akasa Defies Flight Slump

Akasa Air was the only major Indian carrier to expand capacity in March and April, growing flights by 13.2% as rivals retreated, Bloomberg reported.

The Mumbai-based budget carrier, which only began flying in 2022, operated 10,109 flights, roughly 4.7% of total Indian airline traffic.

Fast Facts: IndiGo cut services by 4.5%, Air India's full-service operation by 7.5%, and its low-cost unit Air India Express by 17.1%, part of a nearly 6% industrywide decline driven by higher fuel costs and route disruptions following US and Israeli air strikes on Iran.

Setting: The growth signals Akasa's ambitions against the IndiGo–Air India duopoly, which controls around 90% of domestic capacity. Akasa currently flies 38 Boeing 737 MAX jets but has ordered 226 more for delivery in the coming years.

RBI Eyes Rupee Stability

As the Indian rupee has been nearing the psychological mark of 100 per dollar, the Reserve Bank of India (RBI) said it will do "whatever is required" to ensure orderly movements in the foreign exchange market. In an interview with Mint, Governor Sanjay Malhotra said the rupee appears undervalued after depreciating around 6% since the West Asia war erupted on February 28.

Overview: Malhotra said the RBI does not target any specific exchange rate level but stands ready to counter speculative pressures, citing nearly $700 billion in foreign reserves as firepower. Once the regional conflict normalises, the rupee could appreciate, he added.

Setup: The governor also flagged the need to narrow India's current account deficit and improve capital flows. On monetary policy, he said the RBI's primary mandate remains inflation control, but would support growth if the inflation outlook allowed room to do so.

Corporate Margin Squeeze

India Inc may withstand the prolonged West Asia conflict, but corporate profitability could still take a hit, according to a new Crisil Ratings stress test. The agency analysed 34 sectors, which accounted for 65% of its rated corporate debt, and found that extended supply-chain disruptions and higher crude oil prices could shave nearly 200 basis points off operating profitability this fiscal year.

The Shift: “For companies, managing costs and profitability will be a bigger challenge than achieving topline growth,” said Subodh Rai, managing director at Crisil Ratings. He added that 22 of the 34 sectors tested could see operating profitability fall by more than 10%.

The Lead: Crisil expects sectors such as ceramics, airlines, speciality chemicals and auto components to face the sharpest pressure. Still, strong balance sheets and steady domestic demand should help companies absorb the shock. “Supply hiccups would exacerbate inflation and amplify demand disruption,” said Somasekhar Vemuri, senior director at Crisil Ratings.

Scent of a Deal Sends Oil Prices Down and Markets Up

On Episode 884 of The Core Report, financial journalist Govindraj Ethiraj talks to Vikash Halan, Managing Director, Corporate Finance at Moody's Ratings; K. Ravichandran, Executive Vice President & Chief Rating Officer at ICRA ltd; and Poorvi Chothani, Founder and Managing Partner at LawQuest.

• Why oil markets are now nearing minimum operating levels

• Scent of a deal sends oil prices down, markets up

• Moody’s, Crisil say Indian balance sheets were strong going into conflict

• What will the new Green Card rule mean for Indian visa holders in the US? 

• Oil prices rose for the fourth time in May