L&T Q3 profit surges 53%, gross revenue increases 9.4%
Mumbai: Engineering firm Larsen and Toubro Ltd (L&T) on Wednesday said its net profit for the December quarter rose 53% from a year ago, as revenues increased due to higher order inflow from infrastructure and hydrocarbons businesses.
The company reported a 38% year-on-year increase in fresh orders for the fiscal third quarter and reiterated its revenue growth guidance of 12% for the current fiscal.
’s consolidated net profit for the quarter ended 31 December rose to Rs1,490 crore from Rs972 crore a year earlier. Gross revenue rose 9.4% to Rs28,747 crore.
A poll of 17 analysts on Bloomberg expected L&T to report a consolidated net profit of Rs1,393.70 crore while 18 analysts had expected net sales of Rs28,424.80 crore.
L&T won fresh orders worth Rs48,130 crore in the quarter, up 38%.
International orders at Rs8,835 crore constituted 18% of the total order inflow. A significant portion of the increased order inflow was owing to a 70% rise in domestic orders.
The growth in order inflows was driven by the infrastructure and hydrocarbon segments.
The increase in order inflows was a “welcome relief” for the company, said R. Shankar Raman, chief financial officer at the Mumbai-based company. “If we don’t perform like this, we will be very disappointed.”
He stopped short of calling it a full-fledged recovery in capital investments. The Indian economy is facing the worst slowdown in at least half a decade as investment demand lags.
The Economic Survey released on Monday too had pointed out that the country’s investment slowdown has lasted unusually long and that it may not be over yet.
“We seem to be on the right side of the table. Welcome relief is from the context of things moving on. Now whether that is sustainable, we will have to wait and watch,” said L&T’s Raman.
He also added that tax reforms in the US, the Middle East and elsewhere are resetting the global competitive landscape, presenting other challenges to the engineering company.
At the end of December, L&T’s order book stood at Rs2.7 trillion, up 4.7% from a year ago. The company’s earnings before interest, tax, depreciation and amortization or Ebitda jumped around 600 basis points to 31.4%.
On Wednesday, L&T shares closed 0.87% lower at Rs1,416.60 on BSE, while the exchange’s benchmark Sensex index fell 0.19%. The company’s earnings were released after market hours .