Larsen & Toubro Ltd. (L&T) saw a drop of 67% in its consolidated net profit in its second-quarter earnings, settling at ₹1,819.45 crore from ₹5,520 crore in the year-earlier period.
“The profit after tax for the quarter at ₹1,819 crore includes ₹144 crore gain on divestment of stake in a hydel power plant in Uttarakhand and tax expense of ₹47 crore arising on transfer of the NxT Digital Business from the parent to Mindtree Ltd.,” the company said in a filing.
Consolidated profit after tax (excluding exceptional items and discontinued operations) surged 56%, standing at ₹1,723 crore.
“The growth is mainly driven by higher profits in the IT&TS portfolio and improved margins from the projects & manufacturing portfolio as the pandemic induced stress in previous periods progressively wanes,” CFO R. Shankar Raman said on a conference call.
Revenue increased 12% YOY to ₹34,773 crore, of which ₹12,318 crore. Ir 35% came from international sales.
L&T received orders worth Rs 42,140 crore during the quarter, up 50 percent over the corresponding period in the previous year.
“Orders were received in various segments like oil & gas, metros, rural water supply, minerals and metal, public space and power transmission and distribution,” said the company, stating the international order contributed Rs 22,116 crore or 52 percent of the order inflow.
L&T’s consolidated order book stood at ₹3,30,541 crore, with international orders contributing 23% of the whole.
The infrastructure segment saw a decline of 17% YOY, securing orders worth ₹12,108 crore.
The power segment received orders worth ₹143 crore for the quarter bearing the impact of stagnation of fossil fuel power plant prospects, given the ESG concerns, the company said.
The company’s EBITDA saw an increase of 19.8 percent YOY to Rs 3,994.8 crore and margin expanded to 11.5 percent, up 80 bps compared to the prior-year period.
The heavy engineering segment saw an order inflow of ₹648 crore, and the Defence engineering segment saw a decline of 67%, settling at the orders inflow of ₹441 crore.
The hydrocarbon division secured orders worth ₹14,503 crore marking significant growth over the prior-year period.
IT & technology services (IT&TS) division that includes L&T Infotech, L&T Technology Services and Mindtree saw its customer revenues coming at ₹7,876 crore, a 28% y-o-y increase. These figures indicate a strong demand for more technology-focused offerings sparked by pandemic induced changes in clients’ business models, the company said.
“The company is confident of building on the current business momentum and is committed to the creation of sustainable returns to its stakeholders,” said CFO R. Shankar Raman.