L&T Q3 result | Consolidated PAT falls 17% YoY to Rs 2,055 crore, misses estimate

Larsen & Toubro (L&T) on January 28 reported a 17 percent on-year decline in consolidated net profit to Rs 2,055 crore for the quarter ended December 2021.

The decline in the bottomline is largely on account of a higher base in the year-ago quarter which included the sale of commercial property in the realty business and gain on divestment from discontinued operations of the electrical and automation business.

The country's largest infrastructure company, however, reported an 11 percent on-year growth in consolidated revenues to Rs 39,563 crore during the quarter in review.

"The increase reflects an improving project execution momentum and robust growth in the IT&TS portfolio," the infrastructure giant said in a filing to the bourses.

The company bagged new orders worth Rs 50,359 crore in the reported quarter, which surpassed even the most optimistic analyst's estimate of Rs 45,000 crore, but was down 31 percent on-year.

Overall, the company said that its order book at the end of the quarter was at a record high of Rs 3.4 lakh crore.

Also Read : L&T Q3 Preview | Consolidated PAT to decline over 3% despite 11.5% rise in sales

The infrastructure segment, the biggest contributor to the company's revenues, saw sales rise 15.9 percent on-year to Rs 18,345 crore. The growth in revenue of the segment was better than analysts' expectations.

That said, the operating margin of the infrastructure segment also expanded 90 basis points on-year to 7.2 percent reflecting higher operating leverage for the company.

The power segment also reported strong growth for the reported quarter at 19 percent on-year to Rs 1,066 crore while the segment's operating margin expanded 220 basis points to 4.2 percent.

The hydrocarbon segment, which is the third-biggest contributor to revenues, saw a growth of 11 percent on-year in the reported quarter to Rs. 4,880 crore.

"With consumer confidence gradually returning, the aggregate demand conditions point towards a sustained recovery," L&T said. However, the infra major warned that growth could be marred by higher commodity prices and intermittent supply-side constraints.

"The global macroeconomic environment is likely to slow down with vaccine inequality and rapid spread of the Omicron variant. The world’s largest economies are expected to see a delay in the recovery process with deceleration in activity, diminished fiscal support, rising inflation, and lingering supply bottlenecks," the infrastructure major said.

Shares of Larsen & Toubro ended 0.7 percent lower at Rs 1,897.9 on the National Stock Exchange.