Infrastructure major Larsen & Toubro Ltd yesterday announced a nearly 5 per cent increase in its net profit at Rs 3,167 crore for the last quarter of 2017-18, beating analysts' predictions. This is reportedly the ninth quarter in a row that it has made a profit.
India's largest construction and engineering company further said in a stock exchange notification that its revenue jumped 11 percent year-on-year to Rs 40,678 crore, led by 22 per cent spurts in revenues from its heavy engineering as well as hydrocarbon segments. Revenues from its financial services segment, information technology and infrastructure segment posted increases of 18 per cent, 15 per cent and 12 per cent respectively. Its revenue from power, however, dived 11 per cent year-on-year to Rs 1,506.76 crore.
While L&T reportedly missed its revenue projection for the last fiscal, its order inflow has gone up 5 per cent compared to the December quarter and 7 per cent if you compare FY17 and FY18. The company added that the public sector had predominantly led ordering activity during the year. In fact, domestic inflows compensated for the decline in global orders and its large diversified order book helped smooth-out sectoral cyclicality.
"We expect about 30-32 per cent international orders during 2018-19. We also plan to exit some subscale businesses even if they are profitable," the BloombergQuint quoted L&T's Whole-Time Director and Chief Financial Officer Shankar Raman.
He added that the company expects a 12-15 per cent increase in revenue and 10-12 per cent increase in order inflows in the current fiscal while margins are likely to remain stable with an upward bias of 25 basis points.
L&T's operating margins rose from 11.9 per cent to 13.2 per cent, according to the report, while its earnings before interest, tax, depreciation and amortisation spiked 23 per cent to Rs 5,390 crore. Both surpassed expectations.
On the back of the Q4FY18 results major global brokerages have maintained a buy rating on the stock, which spiked as much as 3.4 per cent to nearly Rs 1,424 apiece this morning, its highest in nearly four weeks.
According to Reuters, Jefferies believes that over next 12 months L&T will benefit from macro tailwinds apart from company-specific improvements and expects the share price to reach Rs 1,925.
L&T informed BSE yesterday that its board has recommended a dividend of Rs 16 per share - up from Rs 14 per share last year - pending approval of the members in the upcoming Annual General Meeting on August 23.