L&T to Invest ₹1,000 Crore in Expanding Katupalli Shipyard to Boost Capacity
Chennai, July 18, 2025 — Larsen & Toubro Ltd (L&T), one of India’s largest engineering and infrastructure conglomerates, has announced a significant investment of ₹1,000 crore to expand its shipbuilding complex at Katupalli, Tamil Nadu. The ambitious project aims to unlock the shipyard’s production potential fully, enabling it to meet the originally approved capacity that has remained underutilised for over a decade.
Despite securing Environment and Coastal Regulation Zone (CRZ) clearances as far back as 2009—which permit an annual output of 50,000 tonnes for its Modular Fabrication Facility (MFF), along with construction of 25 ships and repair of 60 vessels—the Katupalli facility has consistently fallen short of these targets due to infrastructural limitations. Currently, the shipyard is only constructing around 15 vessels and repairing 30 ships annually.
To close this gap and optimise its capabilities, L&T plans to undertake extensive development work within its existing 892.11-acre shipyard complex, located approximately 40 km north of Chennai. According to the company’s internal project document, the expansion will include the establishment of new fabrication units, paint and assembly shops, blasting bays, office blocks, residential quarters, warehouse sheds, and a skill development center. Landscaping work will also be carried out to enhance the greenbelt surrounding the complex.
Work on the expansion is slated to begin in October 2025, with completion targeted within a three-year timeframe.
A Strategic Push for Maritime Growth
The move signals L&T’s strategic commitment to strengthening India’s shipbuilding capabilities amid increasing domestic and global demand for high-quality ship construction and maintenance. The Katupalli yard, a greenfield facility built with an eye on both commercial and defence applications, plays a vital role in the company’s shipbuilding ambitions.
The facility features multiple dry and wet berths, which allow for the simultaneous construction and repair of several vessels. Additionally, the site is equipped with a dedicated design centre focused on warship development—a critical capability as India ramps up its naval modernisation programs.
The planned expansion will not only help the company attain its licensed capacity but will also reinforce India’s maritime infrastructure, aligning with national goals of self-reliance and regional dominance in the shipbuilding sector.
Facilities to Be Upgraded
The proposed development will significantly augment Katupalli’s operational backbone. Once completed, the upgraded yard will support an annual output of:
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50,000 tonnes of steel fabrication through its Modular Fabrication Facility (MFF)
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Construction of 25 ships per year
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Repairs of up to 60 vessels annually
To facilitate this increased output, L&T’s investment will go into building:
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Advanced fabrication shops capable of handling heavy-duty modular sections
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Blasting and painting bays to ensure high-quality surface preparation and finishing
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Modernized assembly zones to streamline the final outfitting of vessels
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Warehousing and logistics hubs to improve material handling efficiency
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Worker accommodations and offices to support an expanded workforce
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A skill development centre aimed at training local talent in cutting-edge shipbuilding technologies
The enhancement of the facility is expected to create hundreds of direct and indirect jobs over the coming years, further contributing to the economic development of Tamil Nadu’s northern coastline.
Industry Recognition and Safety Credentials
L&T’s Katupalli yard has already earned a stellar reputation for safety and operational excellence. In 2019, it became the first shipyard in India to receive a prestigious five-star rating from the British Safety Council following its Occupational Health and Safety Audit. This recognition places the facility in an elite category of shipyards globally that uphold best-in-class safety and operational protocols.
While company officials declined to comment publicly on the expansion, industry analysts suggest that the project underscores L&T’s long-term confidence in the growing importance of India’s maritime and defence sectors.
Catalyzing India’s Maritime Ambitions
India’s shipbuilding industry has traditionally lagged behind global leaders like South Korea and China in terms of capacity and innovation. However, with the government’s increasing focus on port-led development, blue economy initiatives, and domestic naval procurement, private sector players like L&T are beginning to invest heavily in boosting infrastructure.
The expansion of the Katupalli yard is likely to serve not just commercial clients, but also defence requirements as the Indian Navy and Coast Guard ramp up acquisitions of patrol vessels, corvettes, and auxiliary ships.
Moreover, the yard’s modular fabrication capabilities open up possibilities for future exports, with growing interest from Southeast Asia, Africa, and the Middle East in acquiring affordable yet technologically advanced vessels.
A Long-Term Play
L&T’s ₹1,000 crore investment in Katupalli is a long-term strategic play aimed at solidifying its position as a major shipbuilder in the Indo-Pacific region. With its deep infrastructure, modernised shipyard facilities, and focus on safety and quality, the expanded Katupalli yard will significantly elevate India’s presence on the global shipbuilding map.
As India strives to become a hub for maritime manufacturing and services, developments like this are critical stepping stones in achieving that vision.
