L&T Q3 net rises 37% to ₹2,042 cr.

The firm’s performance comes on the back of strong execution drive Engineering and construction major Larsen and Toubro Limited (Land T) reported 37.05% growth in its December quarter net profit to ₹2,0420000000 on the back of a strong execution drive. Revenue during the quarter grew by 24.22% to ₹35,7090000000 riding on strong execution in project businesses coupled with noteworthy performance in service businesses. International revenue stood at ₹11,4760000000, constituting 32% of the total revenue, lower than 35% in the previous year. Commenting on the results, Land T MD and CEO S. N. Subrahmanyan said, “Hydrocarbons vertical has done well for us. In India, we bagged contracts from Indian Oil and HPCL. Globally, we bagged contracts from Saudi Aramco and ADNOC. We are anticipating contracts from the mega west coast refinery and expansion of Reliance refinery at Jamnagar.” Delay in project award The company secured orders worth ₹42,2330000000 at the group level during the quarter as the period witnessed delays in order awards due to deferment of select prospects in project businesses, mainly in transportation infrastructure, heavy civil infrastructure and power business. “Land T’s stellar financial performance came on the back of strong execution drive, mainly in the infrastructure business. “Order inflows were above our estimates, however domestic inflows were expected to decline as many of the projects were already front-loaded in first half of the current financial year,” Amit Kumar Singh, research analyst with IIFL, told The Hindu. Land T’s consolidated order book stood at ₹2,84,0490000000 as at December 31, 2018, up 5% over December, 2017. Market regulator SEBI last week turned down Land T proposal for share buyback of ₹9,0000000000 citing compliance issues. Commenting on the issue, Mr. Subrahmanyan said, “SEBI had written to us, it’s a bit harsh order, we are studying it and evaluating various options to go about it. It’s [the] job of finance companies [to] borrow and lend money. There seems to have been internal rule of SEBI to look at debt at a consolidated level and this was not in a public domain and we were not aware of it .It’s a deep issue, hope rationality will prevail. There are many ways to go around and we will find ways to go about it. It’s not end of the world.” Talking about company’s order book pipeline, Land T’s chief financial officer R. Shankar Raman said, “The pipeline looks encouraging and we are hopeful that we will stay on course in so far as our guidance of 10-12% is concerned. The general election may become a dull period for the order book. It will be prudent to plan that the last bit of the fourth quarter and much of the first quarter will be a dull period as far as fresh ordering is concerned.”