L&T's first quarter net up 36% at Rs 12.1 billion, revenue increases by 19%

Engineering conglomerate Larsen & Toubro (L&T) on Wednesday reported a 36 per cent year-on-year rise in consolidated net profit to Rs 12.14 billion during the April-June quarter, against Rs 8.92 billion a year ago, helped by increase in revenue and improved operational efficiency.

With a 37 per cent rise in order inflows, the management expects the current financial year to be a front-ended, with a higher share of orders in the first half of the year. Revenue from operations improved 19 per cent year on year to Rs 282.83 billion, from Rs 239.89 billion in the year-ago period. The company’s performance for the June quarter was in line with Street expectations. In a Bloomberg poll, 14 analysts estimated a consolidated net profit Rs 12.42 billion and 16 analysts estimated a revenue of Rs 270.30 billion.

“Infrastructure has been the main lever for growth; we have seen this momentum since October,” according to R Shankar Raman, whole-time director and chief financial officer, L&T.

Private sector investments were in a wait-and-watch mode, while public sector continued to drive the investment cycle, he added.

Earnings before interest, taxation, depreciation and amortisation or Ebitda grew 40 per cent to Rs 29 billion during the quarter, against Rs 21 billion in the June 2017 quarter.  In terms of order inflow, the company reported a 37% growth year on year, with Rs 361 billion worth of new orders during April-June 2018. For infrastructure and engineering companies, the first two quarters are typically sluggish in terms of new order wins. However, with more states likely to go to polls this year and general elections soon after, the current year would be a ‘front-ended’ one, Raman said. He reiterated that L&T would refrain from reckless bidding for new orders. The consolidated order book stood at Rs 2.71 trillion as of June, of which 23 per cent was from international markets.