Larsen and Toubro managed 21 per cent year-on-year growth in sales and 14 per cent growth in profits in the March quarter. In a difficult operating environment when most other infrastructure players have seen weakening sales growth or even a dip in sales, L&T's double digit growth was due its focus on on-time execution. This was enabled by the company reducing the proportion of government orders and focussing more on private orders which have limited scope for delays. The company's strategy of keeping revenue ticking has enabled it to weather a turbulent year for the sector.

But the company could not escape pressure on orders flows and profit margins. New orders in the engineering and construction segment fell 32 per cent in the March quarter over the same period last year. This mainly led to company's total order inflows for FY-12 dipping 12 per cent to Rs 70,600 crore. This was the first annual order flow dip for L&T in at least five years. Yet, the company's increased focus on the export market and its diversification across sectors helped mitigate the fall in new orders, compared with other players.

Higher input costs, higher staff costs and mark-to-market provision caused L&T's operating margins for the full year to decline by 1 percentage point to 11.8 per cent. The L&T scrip closed around 1.8 per cent higher on Monday after the result announcement.

SBI surprises the street

The country's largest bank, State Bank of India, sprung a positive surprise on the market by delivering higher-than expected profits of Rs 4,050 crore in the March quarter. The bottom-line growth was a whopping 192 times over the profits of Rs 21 crore clocked in the same period last year. This strong performance was driven by higher interest income (up 45 per cent on a year-on-year basis) and lower provisioning for bad loans (down 13 per cent).

Bucking the industry trend of rising bad loans, SBI improved its asset quality in the March quarter. Its gross non-performing ratio (NPA) fell from 4.6 per cent in December 2011 to 4.44 per cent in March 2012. This improvement was achieved after five consecutive quarters of rising NPA ratios.

The bank's standard asset slippage into the NPA category in the March quarter – Rs 4,300 crore - was the lowest since December 2010. Net interest margins also improved partly due to credit-deposit ratio rising from 76.3 per cent in March 2011 to 78.5 per cent in March 2012.

The markets gave a thumbs-up to the bank's performance and the SBI stock was up 5.8 per cent in Friday's trade.

Suzlon gets a breather

Power equipment maker Suzlon Energy is in the process of obtaining refinance to repay its $200-million zero coupon convertible bonds and $35-million 7.5-per cent foreign currency convertible bonds (FCCBs) which fall due in June. Post market close on Friday, the company announced that the bond-holders will meet in June to provide extension for the company's repayment of debt up to July 27. According to the company, this should enable it to complete documentation work to raise up to $300 million from its consortium of 18 banks.

The fresh loans, if extended, will give breathing space to Suzlon on its impending debt obligations. It will also quell market rumours about the company being required to sell its German subsidiary, REpower, to meet its debt liabilities. Suzlon's consolidated order book and balance sheet have benefitted from REpower, an offshore wind equipment specialist. Market sentiment would have been negatively impacted, if Suzlon had been forced to sell this asset before reaping benefits.

The likely fresh funding facility, along with around $40 million cash raised by Suzlon Energy from the sale of non-critical assets such as wind farms may help mitigate its current difficult financial position.

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