Engineering and construction company Larsen & Toubro has disappointed the street by its earnings but the order inflow came in higher than expectations in the third quarter of financial year 2012-13.
Profit after tax grew by 12.9 percent year-on-year - in-line with analysts' expectations - to Rs 1,120 crore in the quarter. Meanwhile, revenues rose by 10.2 percent - tad lower than forecast - to Rs 15,429 crore from Rs 13,999 crore during the same period.
Analysts on an average were expecting net profit at Rs 1,130 crore and revenues at Rs 16,120 crore for the quarter.
Earnings before interest, tax, depreciation and amortisation (EBITDA) went up by 9.8 percent YoY to Rs 1,475 crore as against forecast of Rs 1,689 crore.
EBITDA margin remained unchanged at 9.6 percent YoY as against expectations of 10.5 percent in October-December quarter, impacted by high input cost and sluggish volumes.
Order inflow increased 14 percent YoY - better-than-forecast - to Rs 19,545 crore, taking total order book to Rs 1.62 lakh crore as on December 31, 2012.
Gross revenue from its engineering and construction segment grew by 11 percent YoY to Rs 13,882 crore and margin came in at 9.2 percent.
Electrical and electronics segment's gross revenue increased 5.3 percent to Rs 886.5 crore from Rs 842 crore during the same period and margin stood at 11.1 percent from the same segment.
Other income jumped 25 percent year-on-year to Rs 530 crore in the third quarter, which included gains out of treasury surplus fund management and disposal of property, the company said.
The company said L&T expected to sustain growth in period ahead as recent government steps will improve investment climate.
"We have been strengthening presence in some overseas markets. Global sales contributed to 23 percent of total revenue in the third quarter as against 19 percent in a year ago period," L&T said.
The company, in its press conference, said exports have doubled during both third quarter and first nine months of fiscal 2012-13.
Operating costs increased 13 percent in October-December quarter and 19 percent in April-December period.
Order inflow for the period of April-December was Rs 60,100 crore. "Power contributed 25 percent to order inflow between April-December and 18 percent of orders came from international market," L&T said.
Order inflow activity has been strong in infrastructure sector. Hydrocarbon sector has started showing signs of recovery, which constituted 11 percent of order inflow in April-December.
Guidance: Engineering conglomerate expect order inflow in the range of Rs 20000-25000 crore for the last quarter (Q4) of FY13.
"We have not cancelled GMR and GVK orders yet and there is no direct communication from these companies on road orders yet," the company said.
Recently GMR Infrastructure and GVK Power terminated the concession agreements with NHAI for Kishangarh-Udaipur-Ahmedabad highway and Shivpuri Dewas Expressway, respectively.
Shares bounced back, climbing as much as 2.2 percent to Rs 1,595.55 amid large volumes on Bombay Stock Exchange at 13:50 hours IST. (The stock dropped 3 percent in morning trade)