US-Iran war: TCS, L&T among others with major Gulf exposure
What's the story
The ongoing US-Iran war has sent shockwaves through the market, with Sensex plunging over 2,700 points at the opening on Monday. At the time of writing, it was down by nearly 1,700 points or 2% to 79,608. The market is worried about rising crude oil prices and the economic impact of a prolonged conflict in the Middle East.
Economic impact
Impact of rising crude oil prices and war on economy
The rise in crude oil prices is a major concern for the Indian economy, as it is a key raw material for several sectors. This means that rising prices could increase companies' input costs and hurt their profitability. Further, a war could disrupt normal operations of companies operating in the region, adding to the economic woes.
Corporate exposure
Larsen & Toubro
Several Indian firms have a significant exposure to the Middle East, with some generating a large part of their revenue from the region. Larsen & Toubro (L&T) is one such company, where international revenues contributed 54% of total revenues in Q3FY26. The company has bagged several large-value contracts in the Middle East over the years and reported order inflows of ₹3,56,631 crore during FY25. The stock fell 7.5% in intraday trade on the BSE today.
Business impact
Tata Consultancy Services and KEC International
Tata Consultancy Services (TCS) also has a significant exposure to the Middle East and North Africa (MENA) region. In Q3FY26, its revenue from this region grew by 8.3% year-on-year, significantly contributing to overall revenue growth. Meanwhile, civil construction firm KEC International has several projects in the Middle East and is strategically focusing on expanding its footprint there. TCS shares declined over 3% to hit a 52-week low of ₹2551.55.
Market response
VA Tech Wabag and Kalyan Jewellers
VA Tech Wabag is also exposed to the Middle East, with ongoing projects in Saudi Arabia. The company's management revealed in its Q3FY26 earnings call that they are executing a 200 MLD Al Haer STP project and a 300 MLD Yanbu Mega Desalination Plant there. Meanwhile, Kalyan Jewellers has major exposure to the region, with revenue rising nearly 28% in Q3FY26.