Larsen & Toubro Q1 profit up 12%, misses street estimates

Engineering and construction giant Larsen & Toubro (L&T) on Wednesday reported a 12% year-on-year rise in its consolidated net profit in the first quarter of fiscal year 2024-25. IndiGo’s profit after tax (PAT) zoomed to ₹2,786 crore for the quarter ended on June 30, 2024, from ₹2,493 crore in the year-ago period. But the profit missed street estimates, according to brokerage reports.

Financial Highlights

1. Revenue Growth: L&T recorded a year-on-year surge of 15% in the revenue from operations which stood at ₹55,120 crore. The 13% in rupee terms growth was largely led by good execution in the Projects & Manufacturing (P&M) portfolio and, to some extent, the hefty order book.

2. EBITDA Performance: The company recorded a 15% yoy growth in EBITDA to ₹5,615 crore. Barco posted an EBITDA margin of 10.2% for the quarter

3. Order Inflow: At the consolidated level, L&T recorded gross orders of ₹70,936 crore during Q1FY20 reflecting 8% YoY growth. The demand was underpinned by strong ordering in the Middle East, helping masking low long-term rates. Of the total order inflow, international orders contributed 46% with ₹32,598.

Segment-wise Performance:

1. Infrastructure Projects: As of June 30, 2024, the order book was at ₹324879 cr with international orders forming a part of ~28% (in total).

2. Energy Projects: This division reported an order book of ₹117,724 crore with 76% being international orders.

3. Hi-Tech Manufacturing: The order book in this segment increased to ` 337.65 billion, including export orders of 7%.

4. IT Services (ITS): The segment delivered customer revenues of ₹11,504 crore; YoY growth: 6 % Although these rates are modest, they mirror the weak economic climate that continues to dampen overall business and government IT&TS spending.

5. Financial Services: Gross operating income stood at ₹3,664 crore with a robust YoY growth of 21%. Bigger disbursements in the retail business led to most of the development.

6. Development Projects: Customer revenues of the segment was at ₹1,327 crore during 2019-20 compared to previous year.

Management Commentary

S.N. Subrahmanyan, the responsibilities Manager and Chief Executive Officer of L&T said, “Q1 FY 2024-25 overall performance is an expression of our strong consistency with continued growth lifestyles throughout economic guidelines despite world problems in the geopolitical environment”. In the current environment of disruption, we have a unique opportunity as an integrated P&M business and technology-driven new-age businesses to capitalize on several transformational shifts that are underway across the globe.

The company has benefitted from Retail Finance in the portfolio of Financial Services, with a performance improvement turning around at recent transformational state,” he added. To strengthen our footprint in the Semiconductor domain, we recently signed a definitive agreement to acquire SiliConch Systems – A Bengaluru-based chip design company.

Also Read – Market Analysis: 63 Moons Technologies Sees Strong Rebound, Closes Up 4.99%

Future Outlook

In relatively stable environment, L&T continues to maintain its focus on profitable execution of its strong order book. All the while, Honeywell maintained confidence in its positions to take advantage of pockets of growth across a diverse business portfolio where new opportunities were there for the taking but non-core businesses had drawn low capital. L&T is committed to creating maximum sustainable value for all its stakeholders!!

L&T growth has been seen across the various financial parameters in Q1 FY2024-25 but on the profit front little more was expected given this challenging global economic outlook which means L&T will surely have to buckle as it enjoys huge order backlog. A strong order book, a wide portfolio & strategic steps into semi-con poised Mahindra CIE for the future, despite ongoing geo-political challenges.

Leave a Comment