The Hindu Business Line : L&T net leaps 40% in third quarter

Given the strong fundamentals in the economy to support a sound growth trajectory of the capital goods sector, the company is well positioned to reap the benefits of the growth momentum.

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Mumbai, Jan 28 Larsen & Toubro Ltd has posted a 40 per cent growth in its third quarter net profit, at Rs.482 crore against Rs.344crore in the same year-ago quarter.

Efficient execution of large size orders, judicious selection of orders with acceptable risk profile and improved cost management enabled the company to post an increase in operating profit, L&T said in a statement from Dubai.

“In view of the company’s strong presence and growing business interests in the Gulf region, the board meeting was held at Dubai, UAE, where the results were announced,” the statement added.

Gross sales and service revenues, at Rs 6,462 crore (Rs 4,200 crore) for the quarter ended December 31, 2007 rose 54 per cent. International operations constituted 18 per cent of revenues. The order inflow during the quarter at Rs 13,019 crore was up 37 per cent.

E&C segment

The engineering and construction segment’s order inflow at Rs 11,462 crore for third quarter grew by 40 per cent.

The segment revenues for the quarter under review stood at Rs 4,962 crore (Rs 3,161 crore), reflecting an increase of 57 per cent. The segment ended the quarter with an order book of Rs 47,605 crore.

E&E segment

The electrical & electronics segment revenues at Rs 616 crore (Rs 483 crore) for the quarter ended December 31, 2007 grew 28 per cent.

Despite rising input costs, the electrical standard products, electrical systems and equipment, control & automation businesses reaped the benefits stemming from new production facilities, improved product lines and higher price differentials, said the release.

Machinery, Indl Products

The segment achieved revenues of Rs 590 crore (Rs 407 crore) for the quarter under review, recording a rise of 45 per cent. Higher price realisation and better manufacturing efficiency helped improve profitability.

Outlook

Given the strong fundamentals in the economy to support a sound growth trajectory of the capital goods sector, the company is well positioned to reap the benefits of the growth momentum. The company said: “On the back of strong oil prices, the West Asian region is also expected to further ramp up investment in oil & gas production and distribution. In the backdrop of this, the company is expected to sustain the growth in order inflows from these sectors.”

On Monday, the company’s shares on the BSE closed lower by 1.18 per cent at Rs 3,844.