Stock Markets are Focusing on L&T

L&T stocks under focus in BSE and NSE Stock markets

MUMBAI, 1st AUGUST 2016: Stocks of engineering major L&T (Larsen & Tubro) will be in focus after it posted a 45.51 per cent increase in net profit at Rs 609.6 crore for the June quarter on the back of improved performance in various segments.

Recently, L&T has announced the consolidated results for the quarter ended June 30, 2016 have been prepared in compliance with Indian Accounting Standards (IND AS) and the comparative results for the corresponding quarter have been restated under IND AS. Larsen & Toubro recorded Consolidated Gross Revenue of ` 21874 crore for the quarter ended June 30, 2016, registering an increase of 9.1% on a y-o-y basis.The International revenue during the quarter at ` 7622 crore constituted 35% of the total revenue. The Company successfully won fresh orders worth ` 29702 crore at consolidated level during the quarter ended June 30, 2016, registering a smart increase of 14%. The International orders at ` 13211 crore constituted 44% of the total order inflow. Major orders during the quarter were secured by Infrastructure and Hydrocarbon Segments. Consolidated Order Book of the group stood at ` 257427 crore as on June 30, 2016, higher by 8% on a y-o-y basis. International Order Book constituted 29% of the total Order Book.

Consolidated Profit After Tax (PAT) for the quarter ended June 30, 2016 at ` 610 crore was higher by 46% vis-à-vis Ind AS restated PAT of ` 419 crore for the corresponding quarter of the previous year. Infrastructure Segment Infrastructure Segment achieved customer revenue of ` 9094 crore for the quarter ended June 30, 2016 registering a y-o-y growth of 9%, driven by progress on jobs under execution in Heavy Civil Infrastructure, Transportation Infrastructure, Power Transmission & Distribution, and Water & Effluent Treatment businesses. International revenue constituted 33% of the total customer revenue of the segment during the quarter. L&T Press Release Issued by Corporate Brand Management & Communications L&T House, 2nd Floor, Ballard Estate, Mumbai 400 001 Tel: 91 22 6752 5656 / 836 Fax: 91 22 6752 5796 CIN: L99999MH1946PLC004768 2 Infrastructure segment secured fresh orders of ` 11802 crore during the quarter ended June 30, 2016 in the backdrop of muted uptick in public spending on infrastructure projects. International orders contributed to around 23% of the total order inflow of the segment during the quarter. The Order Book of the Segment grew 12% on a y-o-y basis and stood at ` 190733 crore as on June 30, 2016. The segment recorded improvement in EBIDTA margin at 9.2% during the quarter ended June 30, 2016 vis-à-vis 8.9% recorded in the corresponding quarter of the previous year. Power Segment Power Segment recorded customer revenue of ` 1722 crore during the quarter ended June 30, 2016, registering a significant growth of 60% over the corresponding quarter of the previous year mainly led by progress on international jobs. International revenue constituted 20% of the total customer revenue of the segment during the quarter. Fresh orders of ` 276 crore recorded by the Power segment during the quarter ended June 30, 2016 represent the Company’s share in the orders secured by the joint venture companies. The Order Book of the Segment stood at ` 16918 crore as on June 30, 2016. The segment EBIDTA margin for the quarter ended June 30, 2016 was higher at 5.8% vis-à-vis 1.2% recorded in the corresponding quarter of the previous year on the back of successful close out of couple of domestic jobs and margins accrued on international project under execution. Heavy Engineering Segment Heavy Engineering Segment achieved customer revenue of ` 659 crore registering a marginal growth of 2% over the corresponding quarter of the previous year.

International Revenue constituted 40% of the total customer revenue of the segment. Heavy Engineering Segment secured fresh orders valued ` 1250 crore during the quarter ended June 30, 2016, recording an increase of 29% on y-o-y basis. International orders constituted 30% of the total order inflow of the segment during the quarter. The Order Book of the Segment stood at ` 7951 crore as on June 30, 2016.

The EBIDTA margin of the segment improved to 14.9% for the quarter ended June 30, 2016 vis-à-vis 8.9% recorded in the corresponding quarter of the previous year as the previous year was impacted due to cost overruns and under-recovery of overheads.

Analyst have called it a disappointing result with Religare Institutional Research calling it a below-expected Q1FY17 results. It said, “Order inflows increased 14% YoY to Rs 29700 cr, while domestic order inflows declined 9% YoY. In our view, current valuations of 18.5x-FY18E consol. EPS are supported by the likely divestment of low-return businesses, even as the outlook on order inflows and execution remains uncertain. We believe capital misallocation of the past would hurt profitability in H2FY17/FY18.”