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Last Updated : Oct 30, 2015 01:36 PM IST | Source: CNBC-TV18

L&T Q2 revenue seen up 11%, exceptional gain may aid profit

Consolidated profit (excluding any exceptional income) is seen rising 9.5 percent year-on-year to Rs 944 crore and revenue is likely to increase 10.6 percent to Rs 23,409 crore, according to analysts polled by CNBC-TV18.


Engineering and construction major Larsen and Toubro (L&T) is likely to see exceptional gain that may boost profitability during July-September quarter. Exceptional income could be from stake sale in L&T Finance (around Rs 5,100 crore) and profit on sale of Chandigarh realty.


Consolidated profit (excluding any exceptional income) is seen rising 9.5 percent year-on-year to Rs 944 crore and revenue is likely to increase 10.6 percent to Rs 23,409 crore, according to analysts polled by CNBC-TV18.


Analysts expect pick-up in revenue growth led by execution of large domestic and international orders despite muted execution in metallurgical and material handling segments.

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Higher utilisation in power and material handling segment may help marginal operating margin expansion. They see improvement in margin due to lower losses in hydrocarbon business and softer commodity prices. Lower year-on-year margin is expected across most engineering and construction (E&C) segment.


Consolidated operating profit may jump 14 percent to Rs 2,669 crore and margin may expand 40 basis points to 11.4 percent compared to year-ago period.


L&T during the quarter told CNBC-TV18 that it expects to do fairly well in Q2 and expects a pick up in Q3 and Q4. It maintained orderbook growth guidance for FY16 at 15 percent.


On standalone basis, reported profit may increase 2 percent year-on-year to Rs 1,062 crore and revenue may rise 7.6 percent to Rs 13,677 crore. Operating profit is likely to inch up 4.1 percent to Rs 1,396 crore but margin may decline 30 basis points to 10.2 percent.


Analysts expect L&T to report new orders worth Rs 30,000 crore in Q2 (lower on yearly basis), though order intake announcements have been muted at Rs 11,000-12,000 crore during the quarter.


Overseas wins have been muted, mainly due to sharp decline in crude prices; order awards in the Middle East fell 50 percent Y-o-Y, say analysts.

Key issues to watch out for would be exceptional income, FY16 order inflow guidance, hydrocarbon business and E&C execution. 



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First Published on Oct 29, 2015 06:39 pm
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