Larsen & Toubro Q3 preview: Q3 profit may rise 21% on strong orders inflows

Larsen & Toubro share: Brokerage see strong order inflows and better execution driving Larsen & Toubro's third quarter revenues and profits higher

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Larsen & Toubro Q3 results preview: Engineering, construction, and manufacturing major Larsen & Toubro (L&T) is scheduled to report a strong set of numbers for the December quarter on the back of robust order inflows, when it reports results on Thursday, January 30, 2025.

  L&T is likely to report Q3 FY25 net sales at Rs 64,851.76 crore, climbing 17.64 per cent year-on-year (Y-o-Y) from Rs 55,127.8 crore in the year-ago quarter, and rising 5.4 per cent quarter-on-quarter from Rs 61,554.6 crore in the previous quarter, accoring to an average of estimates from three brokerage firms.

  The company's earnings before interest, tax, depreciation and amortisation (Ebitda) is expected to improve 14.4 per cent annually and 3.5 per cent sequentially, to Rs 6,586.63 crore, from Rs 5,759 crore in the year-ago period, and 6,362 crore in Q2 FY25.

 

  Moreover, the company's profit after tax (PAT) for the December quarter is expected to rise 21.8 per cent Y-o-Y and 5.7 per cent Q-o-Q, to Rs 3,589.5 crore, from Rs 2,947.4 crore in the year-ago quarter, and Rs 3,395.29 crore in the previous quarter.

  Given this, here's what brokerage firms expect the company's third quarter results to look like:

  Nuvama Institutional Equities

  The brokerage firm says the company's margins may see ramping up but at a slower pace, on the back of a robust order inflow growth, execution completion of legacy projects, and refinancing of the Hyderbad metro project. According to Nuvama, while government capex/initiatives and Middle East hydrocarbon ordering has showed strong momentum, private capex is yet to show its best. 

  It adds that the FY26 strategic plan for L&T is to focus on making subsidiaries self-sustainable, building a strong presence in the green energy (hydrogen, battery storage, etc) space, and non-core exits. 

  The company retained FY25 guidance of 10 per cent/15 per cent OI (order inflows)/sales growth with 8.2 per cent core operating profit margins, or OPMs (bottomed out). "Large OI (order inflows) is likely in H2 across Middle East and India," it said.  

  The brokerage firm has pegged to company's revenue to rise 16 per cent Y-o-Y and 4 per cent Q-o-Q to Rs 64,151.3 crore, while it projects Ebitda to rise 15 per cent Y-o-Y and 4 per cent Q-o-Q to Rs 6,607.6 crore, while PAT is expected to increase 21 per cent Y-o-Y and 5 per cent Q-o-Q to Rs 3,570.7 crore.

  Elara Capital

  According to brokerage firm Elara Capital, L&T received an average inflow worth Rs 576 billion during the December quarter. Moreover, approximately 85 per cent of the inflows were led by domestic entities, constituting ultra mega order from its power boiler turbine generator (BTG) and other segments, such as precision engineering and hydrocarbons worth approximately Rs 400 billion. 

  Elara Capital has pegged Larsen & Toubro's third quarter net sales to rise 21.6 per cent annually and 8.9 per cent sequentially, to Rs 67,046.3 crore, while Ebitda is expected to rise 12.2 per cent annually and 1.6 per cent sequentially, to Rs 6,463.3 crore, while PAT is expected to rise 18.7 per cent Y-o-Y and 3 per cent Q-o-Q to Rs 3,497.5 crore.

  Antique Stock Broking

  The brokerage firm estimates Larsen & Toubro's October to December quarter net sales to rise 15 per cent annually and 3 per cent sequentially to Rs 63,357.7 crore, and Ebitda is expected to increase 16 per cent Y-o-Y and 5 per cent Q-o-Q to Rs 6,689 crore, while PAT is expected to rise 26 per cent on an annual basis, and 9 per cent Q-o-Q to Rs 3,700.3 crore.