Larsen & Toubro (L&T) expects the $150 billion global market for modularisation of industrial projects to offer opportunities worth about $30 billion over the next five years, as rising labour costs and shortage of skilled workers encourage project developers to shift from conventional site construction to factory-built modules.
The company is also looking to expand the use of modular construction in India, while developing a hybrid approach that combines modular and conventional construction to overcome transportation constraints.
L&T completed its first major modularisation project for Australia, involving the shipment of modules manufactured at its Kattupalli facility in Tamil Nadu to Karratha in Western Australia.
The project involved fabrication and delivery of 110 modules, weighing about 64,000 tonnes, for Project CERES, Australia’s largest urea manufacturing plant with a capacity of 2.3 MTPA. The project is being developed by Perdaman Chemicals & Fertilisers at Karratha under the Saipem-Clough joint venture. The project is expected to go live in June next year.
SN Subrahmanyan, Chairman and Managing Director, L&T said the project reflects how L&T is elevating India’s role in the global project-delivery ecosystem, from a manufacturing base to a source of integrated engineering, technology and execution capabilities.
The company is exploring new modernisation opportunities across data centres, prefabricated bridges, precast columns and other industrialised construction solutions. It has also set up a cell focused on small modular construction and plans to take this capability forward, he said.
The company has invested in modern cutting, bending, boring and welding equipment and adopted several Industry 4.0 practices. It plans to progressively convert some fabrication facilities into “dark factories”, where production is highly automated with minimal human intervention, he added.
Its heavy engineering facility already uses robotic welding, automated painting systems and 3D printing, among other technologies. As it expands, the company also aims to raise quality and safety standards across its wider ecosystem, including suppliers and partners, said Subrahmanyan.
Subramanian Sarma, Deputy Managing Director & President, L&T said every module which was shipped to Australia had to meet certain requirements with respect to cleaning and hygiene,” the executive said. The company said the project also highlighted the importance of workforce mobilisation and retention. L&T’s modular operations can require thousands of workers, while the construction industry is facing a broader shortage of skilled labour.
While modules can be transported by sea for waterfront projects, road transportation can constrain the size of modules for inland projects. L&T is therefore evaluating smaller modules that can be transported more easily and assembled at project sites, said, Sarma pointing towards a hybrid construction model.
L&T has nearly 2 lakh tonnes of fabrication capacity across its facilities in Oman, Hazira and Kattupalli, among others. After accounting for offshore requirements, about 1 lakh tonnes could potentially be available for onshore modular projects, allowing the company to execute several large projects concurrently, he said.
Sarma said the company is facing higher logistics costs and delays in the movement of metals, particularly from eastern markets, due to disruptions in shipping routes. Alternative routes are being used in some cases, while cost implications are being discussed with customers.
Published on September 18, 2026
