1. L&T stock hits 52 week high after Q4FY17 PAT jumps 28% beating analysts estimates

L&T stock hits 52 week high after Q4FY17 PAT jumps 28% beating analysts estimates

Earlier today, the stock price of Larsen & Toubro Ltd rose 1.27% to Rs 1,810 making a fresh 52-week high, after the company reported a 28% on-year basis growth in consolidated net profit for the fourth fiscal quarter of the Financial Year 2017.

By: | Updated: May 29, 2017 7:00 PM
L&T’s January-March quarter profit was at Rs 3,180 crore against Rs 2,482 crore a year earlier. Analysts on average had expected a consolidated net profit of Rs 2,592 crore.

Earlier today, the stock price of engineering giant Larsen & Toubro Ltd (L&T) rose 1.27% to Rs 1,810 making a fresh 52-week high, after the company reported a 28% on-year basis growth in consolidated net profit for the fourth fiscal quarter of the Financial Year 2017, beating market estimates, as the steep fall in tax costs and higher revenues boosted bottomline.

L&T’s January-March quarter profit was at Rs 3,180 crore against Rs 2,482 crore a year earlier. Analysts on average had expected a consolidated net profit of Rs 2,592 crore, according to Thomson Reuters data.

During 2016-17, the company recorded a 43% jump in net profit at Rs 6,041 crore. Total income from operations rose 12 percent to Rs 36,828 crore. Gross revenue from the infrastructure segment increased 8 percent on the progress of jobs under execution, the company said. However, operating profit fell 3.6 percent to Rs 4,335 crore and margin contracted by 190 basis points to 11.8 percent compared with same quarter last fiscal due to headwinds in the execution of projects.

Consolidated total income for the fourth quarter in the fiscal year 2017 was Rs 37,227 crore against Rs 33,021 crore in the corresponding quarter of the fiscal year 2016. Infrastructure business, which contributed 45 percent to total revenue, grew by 8.2 percent year-on-year to Rs 20,300.96 crore but its EBIT (earnings before interest and tax) dropped 10.4 percent to Rs 2,519.12 crore on additional cost incurred on extended stay and delays in award & commencement of a few projects.

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Power segment revenue during the quarter slipped 2.8 percent to Rs 1,838.55 crore with EBIT at Rs 58.90 crore (against loss of Rs 33.56 crore YoY) while hydrocarbon business registered a 5.3 growth at Rs 2,579.72 crore with EBIT at Rs 208.01 crore (against loss of Rs 88.76 YoY). Heavy engineering business revenue declined 2.4 percent to Rs 1,034.6 crore with its EBIT at Rs 225.3 crore (versus a loss of Rs 4.2 crore YoY).

Consolidated order book of the group stood increased 5% on-year basis to Rs 2.61 lakh crore at the end of March 2017. The company said its order intake for the quarter stood at Rs 47,289 crore, up 9.6 percent on a year-on-year basis. International order flow for the quarter rose 19 percent YoY to Rs 9,044 crore.

Finance cost for the quarter declined to Rs 296.63 crore from Rs 439.39 crore in corresponding quarter of last fiscal due to loan repayments & efficient fund management. L&T reported an exceptional loss of Rs 281 crore during the quarter against a gain of Rs 48.5 crore in same quarter last fiscal while its tax expenses dropped 66.6 percent year-on-year to Rs 337.2 crore.

L&T is expected to grow its revenue for FY18 at about 12 percent (+/- 1 percent) and order inflow growth is seen at 12-15 percent, R Shankar Raman, Chief Financial Officer said. He expects margin to improve by 0.5 percent in coming quarter (Q1 FY18), though he said the road ahead in FY18 would be challenging.

The board of directors approved bonus shares in the ratio of 1:2, or one share for every two held and also recommended a dividend of Rs 21 per share as compared with Rs 18.25 paid a year ago.

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