Mumbai, July 28: Larsen & Toubro’s (L&T) consolidated net profit more than doubled for the first quarter ended June, bolstered by divestment gains.
The engineering and construction entity reported a net profit of Rs 966.89 crore compared with Rs 458.59 crore in the corresponding period last year.
The profit surge was driven by an exceptional gain of Rs 249.28 crore on stake sales in City Union Bank and L&T Finance Holdings, which was listed in 2011. The sale in L&T Finance Holdings was needed to comply with Sebi regulations to reduce promoter holding.
Consolidated gross revenues grew 10 per cent to Rs 19,123 crore. L&T added that it won fresh orders worth Rs 33,408 crore at a consolidated level, a rise of 11 per cent.
Of this, international order inflow more than doubled over the year-ago quarter to Rs 14,754 crore. They now constitute 44 per cent of the total order inflow. A bulk of the order came from sectors such as infrastructure, hydrocarbon and heavy engineering.
L&T said the infrastructure segment garnered revenues of Rs 7,148 crore, a growth of 17 per cent, but earnings from the power segment dropped 32 per cent owing to a depleting order book.
The heavy engineering segment also earned a lower revenue of Rs 835 on account of delayed order inflow and a depleted order book. The segment secured fresh orders valued at Rs 2,566 crore during the April-June quarter, of which international orders constituted 18 per cent.
L&T added that the quarter was marked by elevated interest rates and tight liquidity conditions in the domestic market. It is, however, optimistic in its outlook and pointed out that the domestic market held good potential in the medium term, with the revival of sectors such as infrastructure, power, minerals & metals, defence and oil & gas following the policy measures taken by the government.
“The overall sentiment in the country has improved especially after the elections. But the ground reality has remained much the same. Perhaps it is unnatural to expect change in the ground reality so soon. But we believe the domestic market holds large potential awaiting impetus through policy measures and conducive investment environment,” group chief financial officer R. Shankar Raman said.
The L&T scrip today settled at Rs 1,644.75, down 0.70 per cent, on the BSE.