L&T Energy GreenTech Inks 3 Lakh Tonne Green Ammonia Pact with ITOCHU

Larsen & Toubro’s green energy arm has signed a long-term agreement with Japan-based ITOCHU Corporation to supply 3 lakh tonnes of green ammonia annually.

The agreement has been signed by L&T Energy GreenTech (LTEGL) and will be serviced from its proposed facility in Kandla, Gujarat. The agreement supports plans to build export-linked green fuel capacity. Supplies are expected to be used for marine fuel needs across key global shipping routes.

The stock reaction remained muted after the announcement. L&T shares closed at ₹4,021, down by 1.33% on 22 April 2026. The decline indicates that the development is seen as incremental rather than a near-term earnings trigger.

What Does the Green Ammonia Deal Involve?

The deal covers a long-term supply of green ammonia, which is being looked at as an alternative to traditional marine fuels.

The scale is significant. The agreement is for 3 lakh tonnes a year, indicating steady demand once production starts. The ammonia will be produced at LTEGL’s planned facility in Kandla, which is being positioned as an export hub for low-carbon fuels.

The supply is expected to support bunkering operations, particularly in Singapore. The city is becoming an important hub for green fuel refuelling due to its location along major global shipping routes.

This agreement also builds on a Joint Development Agreement signed last year, pointing to a continuing partnership between the two companies.

Why Is Green Ammonia Gaining Importance?

Shipping companies are facing growing pressure to reduce emissions. As a result, cleaner fuel options are getting more attention.

Green ammonia is one of the options being explored. It does not release carbon when used as fuel. Handling and movement are also simpler compared to hydrogen. That gives it an edge for long-distance shipping use.

Several countries are already trying to lock in supply. Japan and South Korea are among those looking at partnerships. Indian companies are beginning to participate as well, helped by policy support.

India has set a target of producing about 5 million tonnes of green hydrogen and related fuels by 2030.

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What Does This Mean For L&T’s Strategy And Stock?

The deal adds to L&T’s presence in the green energy space, particularly in hydrogen-based fuels.

For its green energy arm, it brings some visibility to future demand. It also supports plans to scale up production in this segment. The proposed Kandla facility is likely to play an important role in this plan.

On the market front, the reaction has been limited so far. The stock moved within a narrow band during the session, indicating that investors are taking a wait-and-watch approach. Going ahead, progress on execution and additional supply agreements will be important to watch.

Sources:

The Economic Times

Reuters