Lower raw material costs, completion of projects won in the past, and brisk order inflows are expected to boost Larsen & Toubro’s net profit and revenue in the second quarter of FY24.

According to estimates, the engineering and construction company’s consolidated net profit is seen to rise around 23 per cent year-on-year at ₹2,737 crore and revenue is seen around 13 per cent higher at ₹48,446 crore. The earnings before interest, tax, depreciation, and amortisation is seen at just over ₹5,300 crore.

The company will be announcing its earnings after market hours today.

The company’s operating margin, especially for its core engineering and construction business, will be in focus as in past quarters they have been weak. This was primarily because of legacy projects won during COVID when raw material prices were at highs. Prices of key materials such as that of metals have cooled off significantly and the company will likely gain from that.

Kotak Institutional Equities said in a pre-earnings note that it expected the core margin to be at 8.5 per cent, up 40 basis points on year. Nuvama Institutional Equities, however, expects a flat margin in the September quarter with margin improvement only in the second half of the fiscal year.

L&T’s order inflows have been robust and last month it won a $4 billion order from Saudi Aramco for phase 2 expansion of its Jafurah unconventional gas production project. It also got a ₹7,000-crore order in Mumbai for a tunnel project.

The company had bagged orders worth ₹65,520 crore in Q1 of the current fiscal and some analysts have estimated order inflows in Q2 at around ₹62,300 core, up about a fifth from a year ago.

At 9.27 am shares of L&T were flat at ₹2,921.65 on the NSE.

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