Ayaskant,
The lead time basically here means planned delivery time maintained in material master for this product. Plus the time for producing (if procured from another plant). So overall time required to complete the product.
Example
Product A / Plant 1000 / Procurement type F (from another plant) - PDT 2days
Product A / Plant 2000 / PT E - production time 8 days (maintained in routing)
Then total time is 10 days. It also considers time for components also. If that is there then it would add to above (considering stock is not there and you have to procure fresh).
Regards
Rahul