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L&T Q3 profit beats estimates: Key takeaways

Infrastructure segment secured orders of Rs 21,908 crore during the said quarter.|
Jan 25, 2019, 06.40 PM IST
Thanks to strong project execution and stellar show by service business, infrastructure major Larsen & Toubro's December quarter net profit grew at a healthy 37 per cent.

The numbers came in after market hours on Friday.

Profit stood at Rs 2,042 crore in October-December of FY19 over Rs 1,490 crore in Q3 FY18. An earlier ET NOW poll pegged profit at Rs 1,860 crore.

"Riding on strong execution in project businesses coupled with noteworthy performance in service businesses, the company registered a strong revenue growth of 24 per cent on a YoY basis,” the company said in a release.

Here are some of the key highlights of L&T's earnings show.

Q3 topline growth: Revenue from operations jumped 24 per cent to Rs 35,709 crore in Q3 against Rs 28,747.45 crore in the same period last year. The ETNow poll had projected a revenue of Rs 32,891 crore. International revenue during the quarter at 11,476 crore constituted 32 per cent of the total revenue, lower than 35 per cent in the previous year.

Orderbook: L&T received orders worth Rs 42,233 crore at the group level during the quarter under review. There was some delay in order awards due to deferment of select prospects in project businesses mainly in transportation infrastructure, heavy civil infrastructure and power business. The consolidated orderbook stood at Rs 2,84,049 crore as of December 31, 2018, up 5 per cent over December 2017.

Segment-wise show: Infrastructure segment secured orders of Rs 21,908 crore during the said quarter. Power continued to witness muted prospects due to limited opportunities in the face of over-capacity in the sector coupled with aggressive competition. Heavy engineering division secured orders valued Rs 553 crore, recording growth over a low base. AS for defence engineering, the figure read Rs 495 crore. In the electrical and automation (E&A) segment, growth was led by the products business which witnessed better offtake in final distribution products.

Revenue for the hydrocarbon segment at Rs 3,761 crore registered a growth of 22% over the corresponding quarter of the previous year, on accelerated execution in key projects in its portfolio. The division got an order inflow of Rs 7,774 crore during the three months to December, recording a marginal growth of 4 per cent YoY.

IT and Technology Services achieved customer revenue of Rs 3,701 crore, registering a YoY growth of 29 per cent. Financial services recorded customer revenue of Rs 3,259 crore, up 24 per cent, driven by healthy growth in the loan book of focused business of Rural and Housing Finance.

Guidance: Investment traction in transportation infra, metro rail networks, water resources management, irrigation, rural electrification, oil and gas production and refinery capex are likely to sustain. The services businesses, which are in a good shape, are poised for continued growth and value creation.
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