Larsen and Toubro achieved consolidated Revenues of Rs 29,335 crore for the quarter ended 30 June 2021, registering a y-o-y growth of 38%, attributed to healthy  execution of projects despite the second wave of Covid-19 affecting operations at  many locations. Project progress was impacted with regional lockdowns, shortage of  industrial oxygen and supply chain disruptions. The International revenues during  the quarter at Rs 11,186 crore constituted 38% of the total revenue. The company posted consolidated Profit After Tax (PAT) of Rs 1,174 crore registering substantial y-o-y growth of 287% over the corresponding quarter of the previous year. 

The company bagged orders worth Rs 26,557 crore at the group level during the  quarter ended 30 June 2021 registering a growth of 13% over corresponding period  of the previous year. During the quarter, orders were received in various segments  like metros, rural water supply, minerals and metal, residential, power transmission  and distribution, power and hydrocarbon offshore sectors. International orders at Rs 9,045 crore during the quarter comprised 34% of the total order inflow. The consolidated order book of the group was at Rs 323,721 crore on 30 June 2021,  with international orders at 20% of the total order book. 

   

Infrastructure segment secured orders of Rs 11,023 crore during the quarter ended  30 June 2021, registering a marginal decline over the corresponding quarter of the  previous year, mainly due to pandemic induced delay in tendering activities and  finalisation of orders. International orders at Rs 1,058 crore constituted 10% of the  total order inflow of the segment during the quarter. 

The segment order book was at Rs 244,621 crore on 30 June 2021, with the share of  international orders in the order book at 20%. The segment recorded customer revenues of Rs 10,409 crore for the quarter ended  30 June 2021, registering y-o-y growth of 63% with better execution momentum. International revenues constituted 23% of the total customer revenues of the  segment during the quarter.  

The EBITDA margin of the segment during the quarter ended 30 June 2021 was at  7.1% vis-à-vis 6.3% recorded in the corresponding quarter of the previous year.  Better job mix and higher recovery of overheads contributed to margin improvement despite the commodity price inflation affecting the input costs. 

The Power segment recorded order inflow of Rs 911 crore for the quarter ended 30 June 2021, registering substantial growth compared to the corresponding quarter  of the previous year on receipt of an order for Flue Gas Desulphurisation (FGD) project. The order book of the segment was at Rs 12,907 crore on 30 June 2021, with the  international order book constituting 5% of the total order book.  

The segment recorded customer revenues of Rs 759 crore for the quarter ended  30 June 2021, recording growth of over 100% over corresponding quarter of the  previous year with projects in the order book gaining execution momentum. International revenues constituted 4% of the total customer revenues of the segment  during the quarter.  

The segment EBITDA margin for the quarter ended 30 June 2021 was at 2.5%, higher compared to the corresponding quarter of the previous year. 

 

The Heavy Engineering segment recorded an order inflow of Rs 567 crore during the  quarter ended June 30, 2021, recording a y-o-y growth of 19% with a spurt of orders in refinery and oil and gas segments. International orders constituted 52% of the total  order inflow of the segment during the quarter. The order book of the segment was at Rs 4,373 crore on 30 June 2021, with export  orders constituting 32% of the total order book. 

The segment recorded customer revenues of Rs 548 crore for the quarter ended  30 June 2021, recording a y-o-y growth of 45% across all businesses on improved  project execution. International sales constituted 51% of the total customer  revenues of the segment during the quarter. 

The EBITDA margin of the segment at 17.9% for the quarter ended 30 June 2021  registered marginal growth over 17.5% of the corresponding quarter of the previous  year. 

The Defence Engineering segment recorded order inflow of Rs 516 crore during the quarter ended 30 June 2021, registering substantial growth over the corresponding quarter  of the previous year. The order book of the segment was at Rs 7,687 crore on 30 June 2021, with export  orders constituting 9%. The segment recorded customer revenues of Rs 689 crore during the quarter ended  30 June 2021, recording a y-o-y growth of 46% on the back of strong execution of  projects in the weapons and engineering system business. International revenues  constituted 25% of the total customer revenues of the segment during the quarter.  

The EBITDA margin of the segment at 20.3% was higher for the quarter ended 30 June 2021 as compared to 12.9% of the corresponding quarter of the previous year due to change in job mix and contingency releases. 

The Hydrocarbon Segment secured orders valued at Rs 1,002 crore during the quarter ended 30 June 2021. International order inflow constituted 80% of the total order  inflow of the segment during the quarter. The segment order book was at Rs 40,825 crore on 30 June 2021, with the  international order book constituting 36%. 

                   

The segment recorded customer revenues of Rs 4,190 crore during the quarter ended 30 June 2021, recording a y-o-y growth of 37% with peaking of execution activities  in the onshore vertical segment. International revenues constituted 36% of the total  customer revenue of the segment for the quarter. 

The EBITDA margin of the segment at 9.6% for the quarter ended 30 June 2021  registered growth over 5.3% of the corresponding quarter of the previous year. 

IT and Technology Services (IT and TS) Segment 

The segment comprises (a) L&T Infotech (b) L&T Technology Services and  (c) Mindtree.  

The segment recorded customer revenues of ? 7,222 crore during the quarter ended  June 30, 2021, recording an industry leading q-o-q growth of 7% and y-o-y growth of  20%, reflecting a surge in demand for technology led offerings in the sector. Export  billing constituted 93% of the total customer revenues of the segment for the  quarter. 

The EBITDA margin for the segment increased to 23.1% for the quarter ended 30 June 2021 as compared to 20.7% in the corresponding quarter of the previous year, attributed to improved manpower utilisation, increased offshoring and  operational efficiency. 

The financial services segment recorded income from operations at Rs 3,061 crore during  the quarter ended 30 June 2021, registering a y-o-y decline of 7% on account of  decline in loan book.  The Loan Book decreased to Rs 88,440 crore as compared with June’20 level at Rs 98,879 crore, reflecting a cautious lending approach, focus on collections, portfolio sell down, pre-payments in certain verticals and run down of the  de-focused business portfolio. The operating margin of the segment for the quarter ended 30 June 2021 was higher at 8.4% as compared to the corresponding quarter of the previous year with higher  NIM% achieved on reduced cost of borrowing. 

The segment recorded customer revenues of Rs 1,126 crore during the quarter ended  30 June 2021, recording a y-o-y growth of more than 100%, mainly due to higher  PLF witnessed in the Rajpura thermal power plant. Unlike in previous years, where  the Hyderabad Metro services were completely shut, the services remained partially  operational in the current year albeit with restrictive timings due to localised  lockdown, affecting the ridership. The profits in the segment continue to be  adversely impacted due to the severe under-utilisation of the Metro services. 

“Others” segment comprises (a) Realty, (b) Construction and Mining Machinery,  (c) Rubber Processing Machinery, (d) Industrial Valves and (e) Smart World and  Communication businesses. The customer revenues of this segment during the quarter ended 30 June 2021 at Rs 1,329 crore, recorded a y-o-y growth of 86% with higher handover of residential  flats in the Realty business, better progress of projects in Smart World and Communication and higher demand in construction equipment and Rubber  Processing Machinery business. Export sales constituted 8% of the total customer  revenues of the segment during the quarter, majorly pertaining to the Industrial  valves business.  

During the quarter ended 30 June 2021, the segment EBITDA margin at 15.2%, was higher compared to 6.7% in the corresponding quarter of the previous year primarily  aided by revenue growth across all the businesses. 

The financial year commenced with the country witnessing a more severe second  wave of Covid-19, affecting consumption demand and the investment momentum, both of which resulted in the scaling down of the Indian GDP growth forecast. With the waning of the second wave of the pandemic and lockdown restrictions  progressively being eased in recent weeks, signs of pick-up in economic activity  are visible. Further, with expectation of a repeat normal monsoon, the agriculture sector  is likely to remain buoyant. The economy is expected to gain lost ground, aided by  the fiscal stimulus packages announced, adoption of new Covid compatible  occupational models by businesses and the vaccination efforts gathering momentum. Also, with external demand strengthening, a rebound in global trade is expected,  providing fillip to the country’s exports. 

Globally, Government stimulus packages are helping to boost demand and businesses  are adapting better to the emerging physical and economic realities. The sustained  high oil prices is expected to boost the investment momentum in GCC nations. The  recovery however may remain uneven as the global economy continues to be vulnerable to future setbacks due to mutated variants and waves of the Covid-19  virus as evidenced by reintroduction of lockdown restrictions by some countries  while others are engaged in progressive unlocking. 

The company’s focus continues to be on efficient execution of its large order book,  working capital reduction, cost optimisation through use of digital technologies  aimed at operational efficiencies and driving an agile balance sheet. The company is optimistic of its growth aspirations in the medium term as the economic outlook  improves and is committed to creation of sustainable returns to stakeholders.