L&T Q4 Results: Profit Rises 25%, Beats Estimates On Order Flow
A worker smoothes the edges of metal casing at the company factory of Larsen and Toubro Ltd. Heavy Engineering Division in Mumbai, India (Photographer Santosh Verma/Bloomberg).

L&T Q4 Results: Profit Rises 25%, Beats Estimates On Order Flow

Larsen & Toubro Ltd.’s fourth-quarter profit rose beating estimates as its order flow remained higher than its quarterly average.

Net profit of India’s largest engineering-to-construction company increased 24.8% over last year to Rs 3,281 crore in the quarter ended March, it said in its exchange filings. That compares with the Bloomberg consensus estimate of Rs 3,043 crore.

  • Revenue rose 8.7% over last year to Rs 48,087.9 crore, compared with the consensus estimate of Rs 48,602 crore.
  • Operating profit rose 24.8% to Rs 6,388.93 crore. Analysts polled by Bloomberg were expecting Rs 5,516.8 crore.
  • Operating margin rose to 13.2% compared with 11.6% a year ago.
  • On a sequential basis, revenue rose 35.1%, Ebitda increased 49.4% while profit fell 9.8%. Ebitda margin stood at 13.2% compared with 12% in the third quarter.

The company received fresh orders worth Rs 50,651 crore in the fourth quarter. While lower than a year earlier and the preceding three months, the new orders were the second highest in the last four quarters and also higher than the average of at least 12 quarters.

For the year ended March 2021, consolidated order book stood at Rs 3,27,354 crore.

“Much of the plans on the multilateral agency-funded projected are on as per plan,” SN Subrahmanyan, the company’s managing director and chief executive officer, said. “We do see some postponement of projects since some states are fighting Covid-19 and government employees are on Covid duty and some states are coming back from elections.”

Segment Revenue

The infrastructure segment’s revenue rose 3.43% year-on-year while the metric more than doubled in its power unit.

Shankar Raman, the company’s whole-time director and chief financial officer, said the pandemic situation is expected to improve from the second quarter. “We look forward to a growth environment. Growth low-mid teens in terms of revenue and orders. The margins should remain stable in the current range.”

Outlook

The second wave of the Covid-19 pandemic is expected to temporarily slow down growth momentum, especially during the first quarter of FY22, the company said. “Once the immediate challenges of shortages in health infrastructure and availability of vaccines get resolved, it’s expected with controlled implementation of specific lockdowns in localised containment zones and strict adherence to Covid-19 protocols, the economy would recover back with the resumption of near normalised activity in sectors like agriculture, manufacturing, mining, construction and non-contact based services,” it said.

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