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Shares of Larsen and Toubro (L&T) declined 3.3 per cent to Rs 1,368.5 on the BSE in Monday’s intra-day deals on the back of profit booking. India’s largest engineering and construction firm on Friday reported a consolidated net profit of Rs 3,293 crore for the March quarter of FY21 (Q4FY21), up 3 per cent year-on-year (YoY), on higher revenues and surge in other income.
The reported net profit was higher than the Bloomberg consensus estimate of Rs 3,042 crore, despite the 116 per cent YoY jump in tax expenses to Rs 2,087 crore. However, net sales at Rs 48,088 crore and up 8.7 per cent YoY, were slightly lower than expectations of Rs 48,602 crore. Sequentially, it jumped 35 per cent.
“The revenue growth on a YoY basis was evidencing return to pre Covid levels of activity. The international revenues at Rs 15,851 crore constituted 33 per cent of the total revenue,” L&T said in its release.
The order inflow or new orders received during Q4 stood at Rs 50,651 crore, down 12 per cent YoY with the deferment of awards. Sectors such as factories, hydel and tunnel, metros, special bridges, nuclear power, rural water, renewable energy, hydrocarbon offshore and minerals and metal sector contributed significantly to the orders during the quarter.
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International orders at Rs 18,439 crore is at 36 per cent of total order inflow, with receipt of the biggest Solar PV plant order and transmission line orders, said the company.
“L&T’s FY21 performance confirms the global/local trend of slower site traction for long-cycle projects and it’s heartening to see stable balance sheet. Core(inflow/sales) for FY21 dropped by 11 per cent each. However, strong Rs 9.6 trillion pipeline/bottom cycle operating profit margins (OPMs) and rising private sector prospects could offer higher earnings/return delta over two-three years along with divestment upsides,” wrote analysts at Edelweiss Securities in its post-result report. The brokerage has ‘Buy’ call on the stock with a target price of Rs 1,880.
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