AM Naik to step down as L&T's non-executive chairman, 'SNS' to take over

Anil Manibhai Naik, the firebrand group chairman of India’s biggest infrastructure firm Larsen & Toubro (L&T), is stepping down as non-executive chairman after 58 years of association with the company.

Naik, 80, will continue to guide the top leadership of the company as chairman emeritus after the end of his tenure on September 30 this calendar.

L&T’s board of directors on Wednesday also appointed S N Subrahmanyan as chairman and managing director (MD) with effect from October 1. He is currently the chief executive officer (CEO) and MD, the company said in a stock exchange filing.

“L&T has been my life. I am immensely proud that I could play a significant part in its growth. The growth trajectory that the company has charted in the past two/three decades is exemplary. The emphasis we laid on information technology (IT) and technology services has had a significant positive impact on the profitability of the organisation,” Naik said on Wednesday.

“I am sure that Subrahmanyan will continue to foster the high growth and entrepreneurial culture at L&T. In him, L&T has a highly capable, passionate, and empathetic leader,” he added.

AMN, as he is popularly known, is credited with saving the company from corporate raiders in the 1990s including the Ambanis and the Birlas. The company is now 15 per cent owned by an employee trust after a transaction with Aditya Birla Group in 2003 under which the Birlas took over L&T’s cement business and Birla relinquished a 12 per cent stake in favour of the L&T employee trust. 

“I have set up L&T’s software services business from zero to become India’s fifth-largest software services company,” Naik said in an interview in January this year.

Naik started the group’s software services business in the mid-1990s, taking on local competitors like Tata Consultancy Services, Infosys, and Wipro. In 2019, Naik acquired rival firm Mindtree for Rs 10,000 crore and later merged it with L&T’s software firm.

Naik, who passed out from Birla Vishvakarma Mahavidyalaya in Anand as an engineer, steadily rose through the ranks after joining L&T as a junior engineer in 1965. He became CEO in 1999 and became group chairman in July 2017. During his tenure, the market valuation of L&T grew to Rs 3.3 trillion as of May 10, while LTIMindtree’s market valuation rose to Rs 1.35 trillion as the group diversified into defence, IT, and real estate. Today, 90 per cent of L&T’s revenues come from the businesses started by Naik.

“Today 30 per cent of L&T group’s market value comes from the software companies,” Naik said in an interview to this paper in January. “L&T’s future is technology-driven, although our core business of construction and engineering will continue to be a key growth driver,” he had said.

SNS, as Subrahmanyan is popularly known, joined the construction business of L&T in 1984 as a project planning engineer after completing a degree in civil engineering and postgraduation in business management. SNS has been at the helm of L&T for six years since July 1, 2017, as CEO and MD.

Thanking the board, Subrahmanyan said: “I would like to express my sincere gratitude to our group chairman Naik and the board for reposing trust in me and appointing me as chairman and MD. I must humbly submit that all that we have been able to achieve has been with the utmost support of all L&Tites, and, of course, with the firm backing of Naik.”

Naik, who has donated around 75 per cent of his personal wealth to fund education and hospital projects in his hometown in South Gujarat, where he grew up in a modest home, plans to continue his work at the foundation.