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MUMBAI : Larsen & Toubro Ltd on Friday said its consolidated net profit in the December quarter (Q3FY22) fell 17% from a year earlier to 2,055 crore, missing analysts’ estimates.

The decline is largely due to the higher base in the year-ago quarter, which included the sale of commercial property in the realty business, and gains on divestment from discontinued operations of the electrical and automation business, the country’s largest infrastructure company said in a statement. Costlier fuel and raw materials also hurt the company.

“During the quarter in question, we also had to deal with worrisome inflation. We also had to adjust to the new supply-chain protocols and the logistics constraints in the pandemic. And while these were challenges that the company was dealing with, there were opportunities as well in the form of rising demand, particularly post-festive season," said R. Shankar Raman, chief financial officer.

L&T, however, reported an 11% yearly growth in consolidated revenues to 39,563 crore during the December quarter.

“The increase reflects an improving project execution momentum and robust growth in the IT&TS (information technology and technology services) portfolio," the statement said.

The company won new orders worth 50,359 crore during the quarter, down 31% from the previous year, but still above the highest analyst estimates of 45,000 crore.

L&T said its order book at the end of the quarter stood at a record 3.4 trillion. The company, Raman added, is trying to stagger purchases of commodities to maintain margins as it has around 25% exposure to commodities that is subject to price volatility.

The group sees an order pipeline of about 4 trillion at the end of the current quarter and is “trying to stay as close to" to its low-to-mid-teen growth guidance for order inflows for FY22, Raman said.

The infrastructure segment, the biggest contributor to the company’s revenues, saw sales rise 15.9% from a year earlier to 18,345 crore. Operating margin widened 90 basis points to 7.2%, indicating higher operating leverage.

The power segment also reported strong growth for the reported quarter at 19% to 1,066 crore, while the segment’s operating margin expanded 220 basis points to 4.2%.

The hydrocarbon segment, L&T’s third-biggest contributor to revenues, saw a growth of 11% to 4,880 crore.

“With consumer confidence gradually returning, the aggregate demand conditions point towards a sustained recovery," the company said, and added that growth could be marred by higher commodity prices and intermittent supply-side constraints.

“The global macroeconomic environment is likely to slow down with vaccine inequality and rapid spread of the Omicron variant. The world’s largest economies are expected to see a delay in the recovery process with deceleration in activity, diminished fiscal support, rising inflation, and lingering supply bottlenecks," the company said.

Shares of Larsen & Toubro ended 0.7% lower at 1,897.90 on the National Stock Exchange.

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