Despite challenging business environment, India's largest engineering company Larsen & Toubro registered a 15 per cent increase in revenues, baking on new orders worth Rs 48,292 crore for the second quarter of financial year 2019/20 (FY20), which is 20 per cent higher than the corresponding quarter last year. The company's overall order book crossed a new record of over Rs 3 lakh crore.
Large value order wins in hydrocarbon, buildings, factories and power segments were the major contributors to the order inflow during the quarter. International orders during the quarter were at Rs 16,675 crore, constituting 35 per cent of the total order inflow. The order inflow for the half year ended September 30 stood at Rs 86,992 crore, growing at 16 per cent over the corresponding period of the previous year. The consolidated order book stood at Rs 3,03,222 crore as on September 30. It can be executed over the next two and a half years, said Subrahmanyan, Chief Executive Officer and Managing Director and R Shankar Raman, Chief Financial Officer (CFO) of Larsen & Toubro.
"A robust order book, strong balance sheet, diversified business portfolio and proven execution capabilities are acting as an economic moat for the company in the current volatile and challenging economic environment," said the executives.
Consolidated gross revenue for the group was at Rs 35,328 crore for the quarter, achieving an year-on-year growth of 15 per cent. For the half year, the consolidated gross revenue were at Rs 64,964 crore, a growth of 13 per cent. Consolidated profit after tax (PAT) for the quarter was at Rs 2,309 crore, a growth of 10.3 per cent over the corresponding quarter of the previous year. For the half-year ended September 30, 2019, overall PAT (including the PAT from discontinued operations) at Rs 4,000 crore registered an increase of 16.1 per cent.
However, bid deferrals and delays in finalisation of orders caused its infrastructure revenues to come down by 33 per cent during the quarter at Rs 15,669 crore. Of the Rs 3 lakh plus orders, still infrastructure orders constitute over Rs 2,14,898 crore. L&T had 9 per cent higher customer revenue of Rs 16,590 crore for the quarter, despite challenges faced in some states on fund allocation and uncertainty around execution of some early stage projects in Andhra Pradesh and Maharashtra. Power Segment secured new orders worth Rs 4,315 crore for the quarter to take overall orders to Rs 16,481 crore.
However, deferment of orders in refinery, oil and gas sector and fertiliser and petrochemical sectors caused fresh orders in heavy engineering sector to fall by 48 per cent to Rs 680 crore during the quarter. Similarly, fresh defence orders declined by 52 percent and now order book from defence stands at over Rs 10,000 crore. Hydrocarbon segment secured a significantly high quantum of orders valued at Rs 14,851 crore during the quarter with a substantial growth, with receipt of a mega order in onshore vertical in the domestic market as well as receipt of a large order in offshore in an international geography.