A security guard stands outside a project office at a construction site for the Lucknow Metro developed by Lucknow Metro Rail Corp. and operated by Larsen & Toubro Ltd. in the Hazratganj area of Lucknow, Uttar Pradesh, India. (Photographer: Prashanth Vishwanathan/Bloomberg)

Q1 Results: L&T Profit Meets Estimates

Larsen & Toubro Ltd.’s profit rose for the tenth straight quarter meeting estimates.

Net profit stood at Rs 1,215 crore in the April-June period, an increase of 36 percent from the year-ago period, it said in an exchange filing. That compares with the Rs 1,243-crore consensus estimate of analysts tracked by Bloomberg.

Revenue rose 19 percent to Rs 28,284 crore, higher than the estimated Rs 27,030 crore. The strong growth in revenue meant moderation in order book growth at 3 percent, Group Chief Financial Officer R Shankar Raman said in a post-earnings press conference.

The company’s operational performance surpassed estimates. Earnings before interest, tax, depreciation, and amortisation rose 40.4 percent to Rs 2,913.5 crore compared with the Rs 2,578 crore-estimate. Operating margin expanded to 10.3 percent from 8.6 percent. Analysts had forecast 9.5 percent.

“Unlike every year when the revenue uptick is back-ended, we are looking at front-ended revenue growth for this year since we would be going into an election season towards the end of the year,” Raman said.

L&T’s order inflow jumped 37 percent year-on-year as it secured orders worth Rs 36,100 core in the quarter ended June, Raman said. It was driven by infrastructure, heavy engineering and hydrocarbons. Most of the infrastructure orders are from tendering activity which has been strong on the back of capital expenditure from public sector undertakings or projects funded by multi-lateral agencies, said Raman.

Private sector is in a wait-and-watch mode and infrastructure has been the main lever for growth, he said. Of the company’s total order book of Rs 2.7 lakh crore, infrastructure accounts for Rs 2.1 lakh crore.

Maintains Guidance

  • L&T maintained its revenue growth guidance at 12-15 percent for the full year.
  • It also maintained the 10-12 percent order book growth forecast.

Shares of Larsen & Toubro Ltd. ended 0.2 percent lower ahead of its results in a flat Mumbai market.