L&T Q1 net profit jumps 43% to Rs 1,472 cr; exceeds previous fiscal quarter results; new orders record 37% growth
L&T won new orders worth Rs 36,142 crore at the group level during the June quarter, recording a 37 percent growth, with a pick-up in domestic ordering activity. International orders at Rs 9,404 crore constituted 26 percent of the total order inflow
Mumbai: Engineering major Larsen & Toubro (L&T) reported a 43.14 percent jump in consolidated net profit at Rs 1,472 crore in the June quarter. The company had reported a net profit of Rs 1,028.3 crore in the corresponding quarter last year. Its total income in the quarter under review rose by 17.12 percent to Rs 28,527.48 crore, compared with Rs 24,355.52 crore in the year-ago period.
"The strength of the performance is borne out of the fact that the company has done very well across various parameters and exceeded previous fiscal quarter results," the company's group chief financial officer R Shankar Raman told reporters here.
Raman said the revenues, which is a part of the total income, for the periods up to 30 June, 2017, includes excise duty collected from customers. Revenue from 1 July, 2017, onwards is exclusive of goods and service tax which subsumed excise duty.
New orders record 37% growth
The company won new orders worth Rs 36,142 crore at the group level during the June quarter, recording a 37 percent growth, with a pick-up in domestic ordering activity. International orders at Rs 9,404 crore constituted 26 percent of the total order inflow.
"Infrastructure, hydrocarbon and heavy engineering businesses largely contributed to the growth in order inflows during the quarter. We are witnessing a strong tendering activity, especially from the public sector," he said. Also, Raman said sponsors are looking at opportunities to put capital to work and this is a good sign for the industry and L&T to ensure robust growth in order inflow backed up by investment momentum.
"Public sector spending by the central and state governments and PSUs, aided by increased funding by bilateral and multilateral agencies are leading to the building of essential infrastructure," he said.
Progress on the resolution of the stressed private sector corporates through the IBC, according to him, is expected to resolve the issue of overleveraged businesses and kick-start the flow of banking sector credit growth. The consolidated order book stood at Rs 271,732 crore as on 30 June, 2018, of which international segment accounted for 23 percent.
"We continue to focus on profitable execution of our orders, continuous improvement of working capital and cost competitiveness," Raman said.
While the company's infrastructure business recorded revenues of Rs 12,135 crore, the power segment clocked a turnover of Rs 1,080 crore and the heavy engineering business reported an income of Rs 334 crore.
New business vertical
The company has carved out a new business vertical -- defence engineering - as a part of its restructuring strategy, which comprises defence and aerospace business (part of heavy engineering segment till March 31, 2018) and shipbuilding business, which was a part of 'others' segment till then. The segment recorded customer revenue of Rs 727 crore, posting a 34 percent growth over the same quarter last year, with progress on projects under execution.
The electrical and automation segment posted customer revenue of Rs 1,279 crore during the June quarter, a 6 percent year-on-year growth over the year-ago period. The hydrocarbon business registered revenues of Rs 3,511 crore and the IT and technology services segment revenue stood at Rs 3,324 crore.
The company's financial services segment recorded customer revenue of Rs 3,058 crore during the quarter, mainly driven by growth in loan assets and disbursements in the focused business verticals of rural and housing finance. Its developmental projects segment posted customer revenue of Rs 1,494 crore during the quarter.