On a consolidated level, engineering and infrastructure giant Larsen & Toubro clocked 7 per cent revenue growth for the June 2015 quarter over the year-ago period. This is better than the 4 per cent growth in the March 2015 quarter.

The improvement was thanks to a bounce back in the hydrocarbons business, which contributes 11 per cent to consolidated revenues. Execution of orders booked, challenges in its overseas projects being addressed, and pickup in upstream domestic projects helped.

Revenues in the power segment too, which had been floundering, gathered pace and was up 12 per cent, helped by the $200-million Bangladesh order won last August. Steady pace of execution in the mainstay infrastructure segment also benefited the company.

Order inflow slows But it’s not all hunky-dory. Revenues in its heavy engineering and metallurgical segments dropped by 48 per cent and 24 per cent. Revenue in these segments was already down 31 and 56 per cent in the 2014-15 fiscal.

Next, manufacturing and construction costs also rose, as did administrative expenses. As a result, consolidated operating profit margins dropped to 11.3 per cent in the latest June quarter against the 13.2 per cent in the year-ago period. Overall operating profits shrunk 9 per cent. Finally, order inflow for the June quarter bucked the trend of the past several quarters and shrunk 21 per cent. This is due to orders turning sluggish in the infrastructure segment and international orders almost halving compared to the June 2014 quarter. But a quarter’s numbers is not a cause for alarm. Only a sustained drying up of order flows will spell bad news. The current order book is 22 per cent higher than the year before.

Signs of revival in mining activity can help the metallurgical segment in the longer term. Things are also beginning to look up for infrastructure in select pockets.