L&T Technology Services, the engineering and research-focused subsidiary of the Larsen & Toubro, logged a 7 per cent rise in March quarter net profit and said it expects potential difficulties in FY21 due to the COVID-19 pandemic.
However, the firm recorded a marginal growth in net profit on a sequential basis. Net profit for Q4 stood at Rs 204.8 crore against Rs 191.50 crore in the corresponding period of previous fiscal. In Q3 of last fiscal, the firm reported net profit of Rs 204.10 crore.
Revenue grew 8 per cent to Rs 1,446.6 crore during the reporting quarter compared to Rs 1,343 crore in the period a year ago.
For the full fiscal year FY20, the firm logged a rise of 7 per cent in net profit to Rs 818.6 crore compared to Rs 765.60 crore in FY19.
Operating profit margin expanded 50 basis points to 16.5 per cent during FY20.
The IT company bagged nine multi-million dollar deals in Q4 with one in the range of $30 million, while it has signed two more since April having a collective value of over $45 million.
Keshab Panda, CEO & Managing Director, L&T Technology Services, said in a statement that though the outlook is uncertain due to the pandemic, consolidation will help the company expand as customers redraw their business plans.
Panda said that many clients have sought furloughs because of liquidity issues that they have faced, but underlined that the company looks at the period of turbulence as an opportunity.
He said over 93 per cent of the company''s 17,000-strong staff is working from home since the crisis set in March, and the company will look at continuing with the practice for some of them even after the crisis ends.
For some staffers, lab interaction is the only issue with work from home, and the company is looking at ways of working around that.
Panda said while the business related to oil sector will find it a difficult year, medical technologies and telecom should do well.
The company, which had over Rs 800 crore in cash as on March 31, will also look at mergers and acquisitions, he said.
In Q4, the firm hired 96 employees taking its total strength to 16,883 and will continue to do away with low performers, Panda said, stressing that any removals will not be linked to COVID-19.
L&T Technology Services share price closed 4.10 per cent lower at Rs 1,068.90 on Friday.