Published On:May 13 2022
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L&T rises after construction business secures 'significant' contract.

Larsen & Toubro advanced 2.76% to Rs 1566.35 after the company's construction arm secured 'significant' contract for its water & effluent treatment business.

The water & effluent treatment business of L&T Construction has secured a design a build order from the Public Health Engineering Department, Jodhpur, Rajasthan, to execute a parallel carrier system to the Rajiv Gandhi Lined Canal (RGLC Phase Ill) on a single point responsibility basis.

The scope of work includes 213 kms of raw water mild steel transmission mains, 4 pump houses along with associated electrical, mechanical a instrumentation works.

The project will cater to the water demands of the districts of Jodhpur, Pali and Barmer and also provide raw water to the Delhi Mumbai Industrial Corridor (DMIC) and Rajasthan State Industrial Development & Investment Corporation (RIICO).

As per L&T's classification, the value of the 'significant' contract lies between Rs 1,000 crore to Rs 2,500 crore.

Larsen & Toubro (L&T) had announced its earnings for the quarter and the year ended on 31 March 2022 after market hours yesterday.

The engineering and construction major's consolidated net profit rose 10% to Rs 3620.69 crore on 9.9% increase in revenues to Rs 52850.67 crore in Q4 March 2022 over Q4 March 2021.

On a consolidated basis, L&T's profit before exceptional items and tax fell 3.23% year-on-year to Rs 5561.65 crore in Q4 March 2022.

International sales during the quarter stood at Rs 17,550 crore, constituting 33% of the total revenue.

L&T achieved consolidated revenues of Rs 156,521 crore for the year ended 31 March 2022, recording a y-o-y growth of 15% with strong execution in project business aided by continuing growth momentum in the IT&TS portfolio. International revenues during the year at Rs 55,783 crore constitute 36% of the total.

For the year ended 31 March 2022, the consolidated net profit after tax (excluding exceptional items and discontinued operations) at Rs 8,572 crore registered a robust growth of 23% over the previous year. The consolidated net profit after tax (including exceptional items and discontinued operations) for the year ended 31 March 2022 was Rs 8,669 crore.

The board recommended a final dividend of Rs 22 per equity share.

The consolidated order book of the group was at record Rs 357,595 crore as on 31 March 2022, with international orders having a share of 27%.

The infrastructure segment recorded customer revenues of Rs. 29,727 crore for the quarter ended 31 March 2022, registering y-o-y growth of 13%. International revenues constituted 25% of the total customer revenues of the segment during the quarter. The segment order book stood at Rs. 260,624 crore as on 31 March 2022, with the share of international orders at 22%.

The defence engineering segment recorded customer revenues of Rs. 894 crore during the quarter ended 31 March 2022, recording a y-o-y decline of 21%. The share of export revenues was 4% of the total customer revenues for the quarter.

The IT & technology services (IT&TS) segment recorded customer revenues of Rs. 8,761 crore for the quarter ended 31 March 2022, recording q-o-q growth of 4% & y-o-y growth of 30%. International billing contributed 93% of the total customer revenues. In USD terms, the segment revenues of 1,186 million for the quarter grew 4% and 27% on a q-o-q and y-o-y basis, respectively.

In its outlook, L&T said the Indian economy is expected to maintain its recovery momentum as evidenced through the continuous uptick in high frequency indicators including GDP growth. Improved consumer and business sentiments, robust domestic demand conditions and improving tech enabled compliance demonstrated through record tax collections is expected to continue in the medium term, it added.

The continuing fluctuations in crude oil and other commodity prices owing to the current geopolitical uncertainties is leading to high input prices for industries and consumers. The resultant supply chain disruptions could pose a threat to the growth plans of the country in the short-term, it stated.

The company with its detailed 5 year Strategic Plan (Lakshya'26), has chalked out a path for pursuing profitable growth in its traditional businesses of EPC projects and manufacturing. The group will look to expand the size and scale of its IT&TS portfolio. The company will incubate digital offerings in data centers, tech education and B2B e-commerce. It also has plans to invest in the new areas of green energy. Aggressive plans are on to unlock value of its current investment in few non-core areas such as the concessions space, it added.

L&T is an Indian multinational engaged in EPC projects, hi-tech manufacturing and services.


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