s) Provisions, contingent liabilities and
contingent assets
Provisions are recognized for liabilities that can
be measured only by using a substantial degree of
estimation, if
i. The Company has a present obligation as a result of
a past event;
ii. A probable outflow of resources is expected to
settle the obligation; and
iii. The amount of the obligation can be reliably
estimated
Contingent liability is disclosed in the case of
i. A present obligation arising from a past event when
it is not probable that an outflow of resources will
be required to settle the obligation; or
ii. A possible obligation unless the probability of
outflow of resources is remote
Contingent assets are neither recognized nor disclosed.
Provisions, contingent liabilities and contingent assets
are reviewed at each balance sheet date.
t) Statement of cash flows
Cash flows are reported using the indirect method,
whereby profit for the period is adjusted for the effects of
transactions of non-cash nature, any deferrals or accruals
of past or future operating cash receipts or payments and
item of income or expenses associated with investing or
financing cash flows. The Company segregate the cash
flows in operating, investing and financing activities.
u) Investment in subsidiaries
Investments in subsidiaries are measured at cost as per
Ind AS 27 - Separate Financial Statements.
v) Earnings per equity share
Basic earnings per equity share is computed by dividing
the net profit attributable to the equity holders of the
Company by the weighted average numbers of the equity
shares outstanding during the period. The weighted
average number of equity shares outstanding during
the period is adjusted for events such as bonus issue,
bonus element in a rights issue, share split, and reverse
share split (consolidation of shares) that have changed
the number of equity shares outstanding, without a
corresponding change in resources.
For the purpose of calculating diluted earnings per share,
the net profit or loss for the period attributable to equity
shareholders of the Company and the weighted average
number of shares outstanding during the period are
adjusted for the effects of all dilutive potential equity
shares.
Diluted earnings per equity share is computed by dividing
the net profit attributable to the equity holders of the
Company by the weighted average number of equity
shares considered for deriving basic earnings per equity
share and the weighted average number of equity
shares that would have been outstanding assuming
the conversion of all dilutive potential equity shares.
The dilutive potential equity shares are adjusted for the
proceeds receivable had the equity shares been actually
issued at fair value (i.e. the average market value of the
outstanding equity shares). Dilutive potential equity
shares are deemed converted as of the beginning of the
period, unless issued at a later date. Dilutive potential
equity shares are determined independently for each
period presented.
w) Common Control Business combination
Business combinations involving entities that are
controlled by the company or ultimately controlled by the
same party or parties both before and after the business
combination, and where control is not transitory, are
accounted for using the pooling of interests method as
follows:
• The assets and liabilities of the transferred division/
Company are reflected at their carrying amounts
immediately prior to the transfer
• No adjustments are made to reflect fair values, or
recognise any new assets or liabilities. Adjustments
are only made to harmonise accounting policies
• The financial information of the transferred division/
Company in respect of prior periods is restated as
if the business combination had occurred from the
beginning of the preceding period in the financial
statements, irrespective of the actual date of
the combination, however, where the business
combination had occurred after that date, the prior
period information is restated only from that date.
The difference, if any, between consideration paid in the
form of issue of share capital or cash or other assets and
the amount of share capital (if any) of the transferor shall
be transferred to capital reserve and should be presented
separately from other capital reserves. Share capital
issued will be recorded at nominal value.
x) Accounting and reporting information for
operating segments
Ind AS 108 establishes standards for the way that public
business enterprises report information about operating
segments and related disclosures about products
and services, geographic areas, and major customers.
The Company's operations predominantly relate to
providing end-to-end business solutions to enable
clients to enhance business performance. The Company
evaluates performance and allocates resources based on
an analysis of various performance indicators by business
segments. Accordingly, information has been presented
along business segments. The accounting principles
used in the preparation of the financial statements are
consistently applied to record revenue and expenditure in
individual segments and are as set out in the accounting
policies.
Revenue and identifiable operating expenses in relation
to segments are categorized based on items that
are individually identifiable to that segment. Certain
expenses such as depreciation, which form a significant
component of total expenses, are not specifically
allocable to specific segments as the underlying assets
are used interchangeably. The management believes
that it is not practical to provide segment disclosures
relating to those costs and expenses, and accordingly
these expenses are separately disclosed as “unallocated"
and adjusted against the total income of the Company.
Assets and liabilities used in the Company's business are
not identified to any of the reportable segments, as these
are used interchangeably between segments, and it is
not practicable to provide segment disclosures relating
to total assets and liabilities.
y) All amounts included in the standalone financial
statements are reported in millions of Indian rupees
(Rs. in millions) except share and per share data, unless
otherwise stated. Due to rounding off, the numbers
presented throughout the document may not add up
precisely to the totals and percentages may not precisely
reflect the absolute figures. Previous year figures have
been regrouped/ rearranged, wherever necessary.
3. Recent accounting pronouncements
Ministry of Corporate Affairs (“MCA") notifies new
standards or amendments to the existing standards
under Companies (Indian Accounting Standards) Rules
as issued from time to time. For the year ended March
31, 2026, MCA has notified below new standards or
amendments that are applicable or may have a material
impact to the Company.
• Amendment to Ind AS 1 - Classification of liabilities
as current or non-current and non-current liabilities
with covenants:
The amendment specifies the requirements for
classifying liabilities as current or non-current in the
balance sheet, and clarifies the following:
• An entity's right to defer settlement of a liability for
at least twelve months after the reporting period
must have substance and must exist at the end of
the reporting period. The classification of a liability as
current or non-current is unaffected by the likelihood
that the entity will exercise its right to defer settlement.
• If an entity's right to defer settlement of a liability is
subject to covenants, such covenants affect whether
that right exists at the end of the reporting period only
if the entity is required to comply with the covenant on
or before the end of the reporting period.
• In case of a liability that can be settled, at the option
of the counterparty, by the transfer of the entity's
own equity instruments, such settlement terms do
not affect the classification of the liability as current
or non-current only if the option is classified as an
equity instrument.
These amendments have no effect on the measurement
of any items in the standalone financial statements of
the Company. The Company did not make retrospective
adjustments as a result of adopting the amendments to
Ind AS 1.
• Amendment to Ind AS 12 - Pillar-Two Tax Reforms
The Organization for Economic Co-operation and
Development (OECD) has released model rules for a
global minimum tax under the Pillar Two framework
(Pillar Two model rules). The Company's ultimate
parent entity (UPE) has consolidated revenues
exceeding the threshold prescribed under the OECD
framework, and accordingly the Company falls within
the scope of Pillar Two. The Pillar Two legislation are
not enacted by the Government of India, where the
parent entity is incorporated.
Pillar Two legislation has been enacted, or substantively
enacted, in certain jurisdictions in which the Company
operates. Based on the current assessment using
the most recent country-by-country reporting and
the financial statements of the constituent entities,
the Company does not expect a material financial
impact from the application of Pillar Two rules. In
accordance with the amendments to Ind AS-12, the
Company has applied the temporary mandatory relief
from accounting for deferred tax that arises from
implementing Pillar Two legislation
• Amendment to Ind AS 7 and Ind AS 107 - Supplier
Finance Arrangement:
The amendments to Ind AS 7 'Statement of Cash Flows'
and Ind AS 107 'Financial Instruments: Disclosures'
clarify the characteristics of supplier finance
arrangements and require additional disclosures for
such arrangements. The disclosure requirements
in the amendments are intended to assist users of
financial statements in understanding the effects of
supplier finance arrangements on an entity's liabilities,
cash flows and exposure to liquidity risk.
As a result of implementing the amendments, the
Company has provided additional disclosures about
its supplier finance arrangement (refer note 49 for
further details).
• Amendment to Ind AS 21-Lack of exchangeability
The Amendments introduces requirement to assess
when a currency is exchangeable into another
currency and when it is not. The amendment requires
an entity to estimate the spot exchange rate when
it concludes that a currency is not exchangeable
into another currency. These amendments had no
effect on the standalone financial statements of the
Company.
The below amendments are notified but
not yet effective
• Amendment to Ind AS 1 'Presentation of Financial
Statements'- Classification of Liabilities as
current or non-current and non-current liabilities
with covenants:
The amendment includes specific provisions that will
take effect for reporting periods beginning on or after
1 April 2026, retrospectively, as outlined below:
• Breach of material covenant for long-term loan
arrangement on or before end of reporting
period with effect that liability becomes payable
on demand as on reporting date, then it shall be
classified as current liability, if lender agreed
after reporting period and before approval of
financial statements to not demand payment as a
consequence of breach.
• Classify as non-current liability, if lender agreed by
end of reporting period to provide grace period
ending at least 12 months after reporting period
within which entity can rectify the breach provided
lender does not demand immediate repayment.
• Disclose information about the timing of settlement
to understand the impact of the liability on the
financial statements.
The Company does not expect this amendment
to have an impact on its operations or standalone
financial statements.
internal management purposes (which is generally at the operating segment level or the largest group of identifiable CGUs
below an operating segment). A CGU is the smallest identifiable group of assets that generates cash inflows that are largely
independent of the cash inflows from other assets or group of assets.
Impairment occurs when the carrying amount of a CGU including the goodwill, exceeds the estimated recoverable amount
of the CGU. The recoverable amount of a CGU is determined based on higher of value-in-use and fair value less cost to sell.
The calculation of value in use involves use of significant estimates and assumptions which include long-term growth rates,
operating margins used to calculate projected future cash flows, discount rate and future economic & market conditions.
If the recoverable amount of cash generating unit (CGU) is less than its carrying amount, the carrying amount of CGU is
reduced to its recoverable amount and resultant impairment loss is recognized in the statement of profit and loss.
16.6 Shares reserved for issue under options
Information relating to L&T Technology Services Limited Employee Option Plan, including details of options issued, exercised
and lapsed during the financial year and options outstanding at the end of the reporting period, is set out in note 16.8 of
the Standalone financial statement.
16.7 In the period of five years immediately preceding March 31, 2026 :
Aggregate number and class of shares allotted as fully paid up pursuant to contract without payment being received in
cash - Nil (Previous year - Nil)
Aggregate number and class of shares allotted as fully paid up by way of bonus shares - Nil (Previous year - Nil)
Aggregate number and class of shares bought back - Nil (Previous year - Nil)
16.8 Share based payments
i) The objective of the ESOP Scheme, 2016 is to reward those employees who contribute significantly to the Company's
profitability and shareholder's value as well as encourage improvement in performance and retention of talent. In Series
A, the options are vested equally over a period of 5 years and in Series B options are vested equally over period of 4 years,
subject to the discretion of the management and fulfillment of certain conditions.
ii) The exercise period for the options granted under the ESOP Scheme, 2016 would be seven years (84 months) from the date
of grant of options or six years from the date of first vesting or three years (36 months) from the date of retirement/death,
whichever is earlier, subject to any change as may be approved by the Board. The exercise price may be decided by the Board,
in such manner, during such period, in one or more tranches and on such terms and conditions as it may deem fit, provided
that the exercise price per option shall not be less than the par value of the equity share of our Company and shall not be
more than the market price as defined in the SEBI (Share Based Employee Benefits and Sweat Equity) Regulations,2021
and shall be subject to compliance with accounting policies under the said regulation. The number of shares to be allotted
on exercise of options should not exceed the total number of unexercised vested options that may be exercised by the
employee.
vi) Weighted average share price at the date of exercise for stock options exercised during the year is 14,344.55 per share.
(previous year 15,029.55 per share).
vii) No options expired during the periods covered in the above table.
viii) Expense on Employee Stock Option Schemes debited to the statement of profit and loss during 2025-26 is 1166 Million
(Previous year - 1375 Million).
ix) There were 24,900 new options granted duing the year ended March 31, 2026. The fair value at grant date of options granted
during the year ended March 31, 2026 was 14,359.4 & 14,171.3 (Previous year - 15,069.8 & 15,242.4). The fair value at grant
date is determined using the Black Scholes Model which takes into account the exercise price, term of option, share price
at grant date and expected price volatility of the underlying share, the expected dividend yield and the risk free interest
rate for the term of the option. The model inputs for options granted during the year included:
16.9 Dividends
The final dividend on shares is recorded as a liability on the date of approval by the shareholders and interim dividends are
recorded as a liability on the date of declaration by the Company's Board of Directors.
The Company declares and pays dividends in Indian rupees. Companies are required to pay/distribute
dividend after deducting applicable withholding income taxes. The remittance of dividends outside India
is governed by Indian law on foreign exchange and is also subject to withholding tax at applicable rates.
The amount of per share dividend recognized as distribution to equity shareholders in accordance with Companies Act
2013 is as follows:
(a) During the year ended March 31, 2026, the Company paid the final dividend of 138 per equity share for the year ended
March 31, 2025.
(b) The Company paid, on December 24, 2025 an Interim dividend of 118 per equity share for the year ended
March 31, 2026.
(c) On April 22, 2026, the Board of Directors of the Company have recommended the final dividend of 140 per equity
share for the year ended March 31, 2026 subject to approval by the shareholders at the forthcoming annual general
meeting. On approval, the total dividend payment based on number of shares outstanding as on March 31, 2026 is
expected to be 14,240 Million.
Nature and Purpose of reserves.
Securities Premium Account
Amounts received on issue of shares in excess of the par value has been classified as securities premium, net of utilisation.
Share options outstanding account
Employee Share options reserve represents the cumulative expense recognized for equity-settled transactions at each
reporting date until the employee share options are exercised/expired upon which such amount is transferred to Profit and Loss.
Retained Earnings
This reserve represents undistributed accumulated earnings of the Company as on the balance sheet date.
Capital Reserve
The Company recognizes difference between the amount of consideration paid and net worth of acquired business as
capital reserve for common control business combination transactions.
Cash flow hedge reserve
When a derivative is designated as cashflow hedging instrument, the effective portion of changes in the fair value of
derivative is recognised in Other comprehensive income (OCI) and accumulated in cashflow hedge reserve.
Cumulative gains or losses previously recognised in cashflow hedge reserve are recognised in the statement of profit and
loss in the period in which such transaction occurs/hedging instruments are settled/ cancelled.
Debt Instruments through Other Comprehensive Income
This Reserve represents the cumulative gains (net of losses) arising on revaluation of Debt Instruments measured at Fair
Value through Other Comprehensive Income, net of amounts reclassified, if any, to profit or loss when those instruments
are disposed off.
Fixed price contracts:
Fixed price arrangements with customers have defined delivery milestones with agreed scope of work and pricing for each
milestone. Revenue from fixed-price contracts, where the performance obligations are satisfied over time and when there
is no uncertainty as to measurement or collectability of consideration, is recognised as per the 'percentage-of-completion'
method. When there is uncertainty as to measurement or ultimate collectability, revenue recognition is postponed until
such uncertainty is resolved. Percentage of completion is determined based on the project costs incurred to date as a
percentage of total estimated project costs required to complete the project. The input method has been used to measure
the progress towards completion as there is direct relationship between input and productivity. Estimates of total costs
or efforts are continuously monitored over the term of the contracts and are recognized in the net profit prospectively
in the period when these estimates change or when the estimates are revised. Provisions for estimated losses, if any, on
incomplete contracts are recorded in the period in which such losses become probable based on the estimated efforts or
costs to complete the contract.
34 Corporate social responsibility expenditure
a) As per section 135 of the Act, a company meeting the applicability threshold , needs to spend atleast 2% of its average
net profit for the immediately preceding three financial years on corporate social responsibility ('CSR') activities.
The Company's CSR ambit covers skill development, health, sports for disabled, education and environment and it is
continuously investing in welfare initiatives and programmes to provide support to people in the communities where
the Company has presence. A CSR committee has been formed by the Company as per the Act.
b) Amount required to be spent by the Company on CSR related activities during the year is 1295 Million
(Previous year - 1275 Million).
c) Amount spent during the year:
* 114 million transferred to prepaid CSR spent in FY 24-25 utilised in current year against CSR spent Obligation.
** Out of total CSR amount spent during the year 116 million (Previous year - 114 million) transferred to prepaid CSR spent (which can be
used against next 3 year CSR budget) as per rule 7(3) of the Companies (CSR Policy) Rules, 2014.
35 Capital Management Note
The key objective of the Company's capital management is to maximise shareholder value, safeguard business continuity
and support the growth of the company. The Company determines the capital requirement based on annual operating
plans and long term and other strategic investment plans. The funding requirements are met through operating cash flows
generated, and equity. The Company is not subject to any externally imposed capital requirements.
38 Segment reporting
(a) Description of segments and principal activities
Operating segments are defined as components of an enterprise for which discrete financial information is available that is
evaluated regularly by the chief operating decision maker, in deciding how to allocate resources and assessing performance.
The Company's chief operating decision maker is the Chief Executive Officer.
The company has identified business segments as reportable segments. The business segments comprise of :-
• Mobility
• Sustainability
• Tech
Brief description of each segment and principal activities are as under:
1: Mobility: Mobility segment enables bringing together the digital and the physical, driving innovation across software,
hardware and technology for next-gen mobility - and enabling the clients to deliver the digital-first experiences their
customers expect. This segment encompasses Automotive, Trucks and Off-highway Vehicles, Aerospace and Rail erstwhile
transportation segment. Our focus areas include, Vehicle Engineering, Software-Defined Mobility & Electrification &
Hybrid Tech.
2: Sustainability: Sustainability segment enables clients to accelerate the adoption of smart and sustainable processes that
comply with regulations while generating value. This segment encompasses Process Industry and Industrial Products
erstwhile Industrial Products & Plant Engineering segment. The focus areas include Projects Engineering - Green &
Brownfield, Sustainable Manufacturing, Plant Modernization & Automation, Digital Technology, Product Engineering,
Energy Transition, Manufacturing Modernization.
3: Tech: Tech Segment enables clients to develop and improve their processes and products - leveraging AI and next-gen
solutions to help them innovate faster, operate more efficiently, and decrease time to market. This segment encompasses
Medical Technology (MedTech), Independent Software Vendors, Media and Entertainment, and Hi-tech, which includes
Semiconductors (Semcon), Consumer Electronics, Hyperscalers, and Next-Generation Communications (NexGen
Comms) erstwhile Telecom and Hi-tech & Medical Devices segment.
The management primarily uses a measure of earnings before interest, tax, depreciation and amortisation (EBITDA, see
below) to assess the performance of the operating segments.
(i) Primary segments are defined based on the industries from which revenues are derived and segmental results are as
under:
Property, plant and equipment (PPE) used and liabilities contracted for performing the Company's business have not been
identified to any of the above reported segments as the PPE and services are used inter-changeably among segments.
(iii) No single customer represents 10% or more of the Company's total revenue for the year ended March 31, 2026 and
2025.
(iv) Segments have been identified in accordance with Indian Accounting Standards (“Ind AS") 108 on Operating Segments,
considering the risk/return profiles of the business, their organisational structure and internal reporting systems.
The Segment composition:
• Mobility segment encompasses Automotive, Trucks and Off-highway Vehicles, Aerospace and Rail
• Sustainability segment encompasses Process Industry and Industrial Products
• Tech segment encompasses Medical Technology, Software and Platforms and Media and Entertainment
The segment related disclosures (i.e. segment revenue and segment results) for comparative periods have been
reclassified to confirm with the presentation and reporting in the current period.
39 Financial risk management
i) Market risk management
The Company regularly reviews its foreign exchange forward and option positions, both on a standalone basis and in
conjunction with its underlying foreign currency related exposures. The Company follows cash flow hedge accounting
for highly probable forecasted exposures (HPFE) hence the movement in mark to market (MTM) of the hedge contracts
undertaken for such exposures is likely to be offset by contra movements in the underlying exposures values. However,
till the point of time that the HPFE becomes an on-balance sheet exposure, the changes in MTM of the hedge contracts
are accumulated in the balance sheet of the Company. The Company manages its exposures normally for a period of up
to three years based on the estimated exposures over that period. As the period increases, the cash flows hedged as a
percentage of the total expected cash flows diminish, as there is increased uncertainty of the total cash flows materializing
over a longer period of time. The recognition of the gains and losses related to these instruments may not always coincide
with the timing of gains and losses related to the underlying economic exposures and, therefore, may adversely affect the
Company's financial condition and operating results. Hence, the Company monitors the potential risk arising out of the
market factors like exchange rates, interest rates, price of traded investment products etc. on a regular basis. For on balance
sheet exposures, the Company monitors the risks on net un-hedged exposures.
ii) Price risk management
The Company's investment policy and strategy are focused on preservation of capital and supporting the Company's
liquidity requirements. The Company uses a combination of internal and external management to execute its investment
strategy and achieve its investment objectives. The Company typically invests in money market funds, under a limits
framework which governs the credit exposure to any one issuer as defined in its investment policy. To provide a meaningful
assessment of the price risk associated with the Company's investment portfolio, the Company performed a sensitivity
analysis to determine the impact of change in prices of the securities that would have on the value of the investment
portfolio assuming a 0.25% move in debt funds and debt securities. Based on the investment position a hypothetical 0.25%
change in the fair market value of debt securities would result in a value change of /- 11.36 Million as of March 31, 2026, and
/- 19.36 Million as of March 31, 2025. The investments in money market funds are for the purpose of liquidity management
only and are held only overnight and hence not subject to any material price risk.
iii) Foreign currency risk management
I n general, the Company is a net receiver of foreign currency. Accordingly, changes in exchange rates, and in particular a
strengthening of the Indian Rupee, will negatively affect the Company's net sales and gross margins as expressed in Indian Rupees.
The Company may enter into foreign currency forward contracts with financial institutions to protect against foreign
exchange risks associated with certain existing assets and liabilities, certain firmly committed transactions, forecasted
future cash flows and net investments in foreign subsidiaries. The Company's practice is to hedge a portion of its material
net foreign exchange exposures with tenors in line with the projected exposure based on future business growth. However,
the Company may choose not to hedge certain foreign exchange exposures for a variety of reasons, including but not limited
to accounting considerations and the prohibitive economic cost of hedging particular exposures. The Company may also
not hedge 100% given the uncertainty with business projections and hence the exposure gets hedged progressively in
lower amounts.
To provide a meaningful assessment of the foreign currency risk associated with the Company's foreign currency derivative
positions against off balance sheet exposures and unhedged portion of on-balance sheet exposures, the Company uses a
multi-currency correlated value-at-risk (“VAR") model. The VAR model uses a Monte Carlo simulation to generate thousands
of random market price paths for foreign currencies against Indian rupee taking into account the correlations between
them. The VAR is the expected loss in value of the exposures due to overnight movement in spot exchange rates, at 95%
confidence interval. The VAR model is not intended to represent actual losses but is used as a risk estimation tool. The model
assumes normal market conditions and is a historical best fit model. The overnight VAR for the Company at 95% confidence
level is K440 Million as of March 31, 2026 and 1275 Million as of March 31, 2025.
Actual future gains and losses associated with the Company's investment portfolio and derivative positions may differ materially
from the sensitivity analyses performed as of March 31, 2026 due to the inherent limitations associated with predicting the
timing and amount of changes in foreign currency exchanges rates and the Company's actual exposures and position.
iv) Credit/counter-party risk management
The principal credit risk that the Company is exposed to is non-collection of trade receivables and late collection of receivables
leading to credit loss. The risk is mitigated by reviewing creditworthiness of the prospective customers prior to entering into
contract and post contracting, through continuous monitoring of collections by a dedicated team.
The Company reviews trade receivables on periodic basis and makes provision for doubtful debts if collection is doubtful.
The Company also calculates the expected credit loss (ECL) for non-collection and for delay in collection of receivables.
The Company makes additional provision if the ECL amount is higher than the provision made for doubtful debts. In case
the ECL amount is lower than the provision made for doubtful debts, the Company retains the provision made for doubtful
debts without any adjustment.
The provision for doubtful debts including ECL allowances for non-collection of receivables and
delay in collection, on a combined basis, was 1443 Million as at March 31, 2026 and 1180 Million as at
March 31, 2025. The movement in allowances for doubtful accounts comprising provision for both non-collection of
receivables and delay in collection is as follows:
The percentage of revenue from its top five customers is 19% for 2025-26 (19% for 2024-25).
The counter-party risk that the Company is exposed to is principally for financial instruments taken to hedge its foreign
currency risks. The counter-parties are mainly banks and the Company has entered into contracts with the counterparties
for all its hedge instruments.
The Company invests its surplus funds in liquid investments and mitigates the risk of counter-party failure by investing with
institutions having good credit rating.
v) Liquidity risk management
The Company manages liquidity risk by maintaining sufficient cash and marketable securities and by having access to
funding through an adequate amount of committed credit lines.
Management regularly monitors the position of cash and cash equivalents vis-a-vis projections. Assessment of maturity
profiles of financial assets and liabilities including debt financing plans and maintenance of balance sheet liquidity ratios are
considered while reviewing the liquidity position.
(i) Fair value hierarchy
This section explains the judgements and estimates made in determining the fair values of the financial instruments that are
(a) recognised and measured at fair value and (b) measured at amortized cost and for which fair values are disclosed in the
financial statements. To provide an indication about the reliability of the inputs used in determining fair value, the Company
has classified its financial instruments into the three levels prescribed under the accounting standard. An explanation of
each level follows underneath the table.
Level 1 - Quoted prices (unadjusted) in active markets for identical assets or liabilities.
Level 2 - Inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
(i.e. as prices) or indirectly (i.e. derived from prices).
Level 3 - Inputs for the assets or liabilities that are not based on observable market data (unobservable inputs).
There were no transfers between the levels during the year.
The Company's policy is to recognise transfers into and transfers out of fair value hierarchy levels as at the end of the
reporting period.
(ii) Valuation technique used to determine fair value
Specific valuation technique used to value financial instruments include :
• the use of quoted market prices or dealer quotes for similar instruments
• the fair value of forward foreign exchange contracts and principal swap is determined using forward exchange rates at
the balance sheet date.
(iii) Valuation processes
The finance department of the Company includes a team that performs the valuations of financial assets and liabilities
required for financial reporting purposes, including level 3 fair values. The fair valuation of level 1 and level 2 classified
assets and liabilities are readily available from the quoted prices in the open market and rates available in secondary market
respectively. The valuation method applied for various financial assets and liabilities are as follows -
• Quoted price in the primary market (net asset value) considered for the fair valuation of the current investment i.e mutual
funds. Gain/(loss) on fair valuation is recognised in statement of profit and loss.
• The carrying amounts of trade receivable, unbilled revenue, trade payable, cash and bank balances, short term loans and
advances, statutory dues/receivable, short term borrowing, employee dues are considered to be the same as their fair
value owing to their short-term nature.
• The fair value of premium receivable on financial guarantee contract is derived by discounting premium receivable over
the period of contract.Thereafter, the same is carried at the amount initially recognised less the cumulative amortisation
of income over the period of the contract.
• The fair value of non-current security deposits are calculated by discounting future cash inflows.
(iv) Fair value of financial assets and financial liabilities measured at amortized cost:
The carrying amounts of all financials assets and financial liabilities are considered to be the same as their fair values owing
to their short term nature.
41 Tax reconciliation statement
A reconciliation of the income tax provision to the amount computed by applying the statutory income tax rate to the
income before income taxes is summarized below:
The applicable Indian statutory tax rate for fiscal year 2026 and 2025 is 25.17%.
Overseas taxes are on account of income taxes payable overseas, principally in the United States of America.
The Organisation for Economic Co-operation and Development (OECD) has released model rules for a global minimum
tax under the Pillar Two framework (Pillar Two model rules). The Company's ultimate parent entity (UPE) has consolidated
revenues exceeding the threshold prescribed under the OECD framework, and accordingly the Group falls within the scope
of Pillar Two. The Pillar Two legislation are not enacted by the Government of India, where the parent entity is incorporated.
Pillar Two legislation has been enacted, or substantively enacted, in certain jurisdictions in which the Company operates.
Based on the current assessment using the most recent country-by-country reporting and the financial statements of the
constituent entities, the Company does not expect a material financial impact from the application of Pillar Two rules. In
accordance with the amendments to Ind AS-12, the Company has applied the temporary mandatory relief from accounting
for deferred tax that arises from implementing Pillar Two legislation.
42 Disclosure pursuant to Ind AS 19 "Employee benefits"
i) Defined contribution plan
The Company has recognised 12,753 Million (Previous year - 12,498 Million) towards defined contribution plan as an expense,
which includes contribution to social security and employee state insurance scheme in statement of profit and loss account.
Risk exposure
i. Gratuity
The Company operates gratuity plan through a trust wherein every employee is entitled to the benefit equivalent to fifteen days last
salary drawn for each completed year of service. The same is payable on termination of service or retirement whichever is earlier.
The benefit vests after five years of continuous service. The trustees of the plan have outsourced the investment management
of the fund to an insurance company. The insurance company in turn manages these funds as per the mandate provided to them
by the trustees and the asset allocation which is within the permissible limits prescribed in the insurance regulations.
ii. Post retirement medical benefits plan
The post-retirement medical care plan provides for reimbursement of health care costs to certain categories of employees
post their retirement. The reimbursement is subject to an overall ceiling sanctioned based on cadre of the employee at the
time of retirement. The plan is unfunded. Employees do not contribute to the plan.
General descriptions of defined benefit plans
a Gratuity plan
The Company makes contributions to the employees' group gratuity-cum-life assurance scheme of the Life Insurance Corporation
of India, a funded defined benefit plan for qualifying employees. The scheme provides for lump sum payment to employees
at retirement, death while in employment or termination of employment of an amount equivalent to 15 days salary for every
completed year of service or part thereof in excess of six months, provided the employee has completed five years in service.
Unfunded gratuity represents a small part of gratuity plan which is not material. Further, the unfunded portion includes
amounts payable in respect of the Company's foreign operations which result in gratuity payable to employees engaged
as per local laws of country of operation.
b Post-retirement medical benefit plan
The post-retirement medical benefit plan provides for reimbursement of health care costs to certain categories of employees
post their retirement. The reimbursement is subject to an overall ceiling limit sanctioned at the time of retirement. The ceiling
limits are based on cadre of the employee at the time of retirement.
c Provident Fund trust managed by the holding company
The Company's provident fund plan is managed by its holding company through a trust permitted under The Employees'
Provident Funds and Miscellaneous Provisions Act, 1952. The plan envisages contribution by employer and employees
and guarantees interest at the rate notified by the Provident Fund Authority. The contribution by employer and employee
together with interest are payable at the time of separation from service or retirement whichever is earlier. The benefit
under this plan vests immediately on rendering of service.
Employee benefit plan outside India
In January 2018, the Company established the L&T Technology Services 401k Plan (the “Plan") for the benefit of its
employees in USA. As allowed under section 401(k) of the Internal Revenue Code, the Plan provides for tax-deferred salary
contributions for eligible employees of L&T Technology Services Limited. The Plan allows the employee and Company's
contributions to vest 100% immediately. During the year ended March 31, 2026, the Company contributed 1277 Million
towards the Plan (Previous year - 1196 Million).
5 Total cash outflow for leases amounts to 11,990 million during the year (Previous year - 11,893 million ) including cash
outflow of short term leases
6 Lease commitment
The company has entered into lease commitment for an year for properties at Chennai (1 14 million), Poland (1 13 million)
and Faridabad (1 9 million) (Undiscounted Lease liability) ( Previous year - 1 234 million).
45 Disclosure pursuant to Ind AS 115 "Revenue from contract with customers":
a) Transaction price allocated to remaining performance obligation
i) The aggregate value of performance obligations that are completely or partially unsatisfied as of March 31, 2026, other
than those meeting the exclusion criteria mentioned below in (ii), is 114,483 Million. Out of this, the Group expects to
recognize revenue of around 111,335 Million within the next one year. Remaining performance obligation estimates are
subject to change and are affected by several factors, including changes in the scope of contracts, periodic revalidations,
and adjustments for currency.
ii) The Company has applied practical expedient and has not disclosed information about remaining performance obligations
in contracts where the entity has the right to consideration that corresponds directly with the value of entity's performance
completed to date, typically those contracts where invoicing is on time and material basis.
b) Movement in contract balances
i) The Company classifies the right to consideration in exchange for deliverables as either a receivable or as unbilled revenue.
Revenues in excess of billings is recorded as unbilled revenue and is classified as a financial asset for time and material jobs
where right to consideration is unconditional upon passage of time. Unbilled revenue for fixed price contracts is classifed
as non financial asset as the contractual right to consideration is dependent on completion of contractual milestones.
v) The gross amount of trade receivable acquired is 1592 Million, its fair value is 1590 Million and the amount has been
substantially collected.
vi) The acquired business of Intelliswift Software (India) Private Limited contributed revenues of 1476 Million and profit
after tax of 139 Million to the group from acquisition date to March 31, 2025. If business was acquired from April 1,
2024, they would have reported revenue of 11,904 Million and profit after tax of 1158 Million during 2024-25.
47 Government grants
A. The Company has received incentives amounting to 194.75 Million (previous year 129.25 Million) from government of
UK against money spent on research and development and has accounted for it under other income.
B. The Company has received government grants amounting to 128.08 Million (previous year 146.69 Million) from
governments of various countries on compliance with several employment-related conditions and accordingly,
accounted it as a credit to employee benefits expense.
C. The Company has received government grants from the Singapore Government amounting to 10.14 Million (Previous
year- 1 NIL), comprising Corporate Income Tax rebate and cash grant and has accounted for it under other income.
Dues to Micro and Small Enterprises as defined in Micro, Small and Medium Enterprises Development Act, 2006, have been
determined to the extent such parties have been identified on the basis of information collected by the Management.
52 a) Effective November 21, 2025, the Government of India consolidated 29 existing labour regulations into four Labour
codes, namely, The Code on Wages, 2019, The Industrial Relations Code, 2020, The Code on Social Security, 2020 and
the Occupational Safety, Health and Working Conditions Code, 2020, collectively referred to as the 'New Labour Codes'.
The New Labour Codes has resulted in material increase in provision for employee benefits on account of recognition of
past service costs. Based on the requirements of New Labour Codes and relevant Accounting Standard, the company
has assessed and accounted the estimated incremental impact of 1354 million as exceptional Item in the Standalone
Financial Statements of the Company for the year ended March 31, 2026. Upon notification of the related Rules, including
further clarifications, to the New Labour Codes by the Government, the company will evaluate and account for additional
impact, if any, in subsequent periods.
b) As a part of restructuring initiative, the company has decided to close certain overseas business, released few resources
along with closure of those overseas offices. Restructuring expense, including termination benefits, of 1370 million, are
disclosed as 'Exceptional items' in the Standalone Financial Statements of the Company for the quarter and year ended
March 31, 2026, owing to their material and non-recurring nature.
53 The Company did not have any significant long-term contracts including derivative contracts for which there were any
material foreseeable losses.
54 An amount of 10.79 million which was due and payable and remained unclaimed and unpaid for a period of seven years, was
transferred to the Investor Education and Protection Fund (IEPF) as at March 31, 2026 (previous year- 10.26 million).
55 Previous year's figures have been regrouped / reclassified wherever necessary.
In terms of our report attached For and on behalf of the Board of Directors of
For M S K A & Associates LLP L&T Technology Services Limited
(Formerly Known as M S K A & Associates)
Chartered Accountants
ICAI Firm registration no. 105047W/W101187
Nitin Tiwari Prasad Shanbhag Amit Chadha Rajeev Gupta
Partner Company Secretary Chief Executive Officer Executive Director &
& Managing Director Chief Financial Officer
Membership no. 118894 Membership no. A30254 (DIN: 07076149) (DIN: 06782710)
Place: Mumbai Place: Mumbai Place: Washington, USA Place: Mumbai
Date: April 22, 2026 Date: April 22, 2026 Date: April 22, 2026 Date: April 22, 2026
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