Engineering major Larsen & Toubro today reported a 15.56 per cent rise in net profit for the September quarter at Rs 995.90 crore and halved its order inflow guidance to 5-7 per cent, as also lowered revenue projection to around 12 per cent, citing subdued investment climate.
Net sales rose 10.55 per cent to Rs 23,393.22 crore in the reporting quarter from Rs 21,159.35 crore a year ago.
"Despite efforts taken by the government, investment momentum is yet to pick up and as a result, order inflows are devoid of large investments. There is still capacity under-utilisation and, therefore, no investments are coming in capacity addition. Players are waiting for demand momentum to go up," group Chief Financial Officer R Shankar Raman told reporters here said.
He further said, "If you look at the half-year position we are at Rs 55,000 crore in order inflows compared to Rs 73,000 crore a year ago. So, we are revising down our order inflow guidance to 5-7 per cent from 15 per cent initially projected as we believe the subdued investment environment to continue for some more time. Last year, order inflows rose 22 per cent to Rs 1.55 lakh crore.
"Accordingly, we also see a dip in revenue outlook to 10-15 per cent at March-end from our initial projection of 15 per cent for the year," Raman said.
He, however, said there could be a few orders that could rattle up these numbers in a big way.
He also said, on the domestic front, the infra segment is looking up, and our order inflows are robust, thanks to the push on transport projects, power transmission, and the water sectors.
"As far as revenue guidance is concerned, fortunately much of it comes from our order backlog so we don't have to win orders for revenues. We've been running around at 10 per cent growth so far this year. Domestic revenues have not shown picked up due to execution challenges. We think we might land up somewhere between 10 and 15 per cent, or may be even 12 per cent," Raman said.
The company turned in consolidated revenue of Rs 23,605 crore for the quarter, up 11 per cent. International revenue rose to Rs 7,658 crore, constituting 32 per cent of the total revenue.
Total expenses rose to Rs 21,495.13 crore during the quarter under review from Rs 19,373.65 crore a year-ago.
L&T secured fresh orders worth Rs 28,620 crore during the quarter out of which international order inflows stood at Rs 10,973 crore, constituting 38 per cent of total. Major orders during the quarter were secured by the infrastructure segment.
