L&T Q2 RESULTS 2024: PROFIT UP 45%, REVENUE JUMPS 19%

L&T reported its Q2FY24 numbers on Tuesday evening. Let us look at everything in detail for L&T for Q2FY24.  

About L&T

Larsen & Toubro (L&T) is a multinational conglomerate with operations in the engineering, construction, manufacturing, and technology sectors. It is one of the largest and most respected companies in India, involved in projects ranging from infrastructure development to defense and aerospace.

Crucial parameters

• PE: 46.11
• 52-week high: Rs 3114.00
• Market Cap: Rs 4,11,686.40 crore
• ROE: 12.21

Share price movement

In the last one month, L&T's share has fallen by 5%. In 2023, the share price has beaten benchmark indices, with a gain of 40%. For the 5-year time frame, the share price has more than doubled with a gain of 115%.

How has L&T performed in Q2FY24?

Let us look at L&T's September quarter numbers in detail:

Revenue: Larsen & Toubro reported consolidated revenues of Rs 51,024 crore for the quarter ended September, a growth of 19% YoY. The company reported higher-than-expected sales growth driven by execution tailwinds in the infrastructure projects segment and sustained growth momentum in the IT and ITeS portfolio. The highest revenue came from the Infrastructure (48%) segment, followed by Services (32%).

EBITDA: The company reported an EBITDA of Rs 5,632 crore, a growth of 15%. It had an EBITDA of Rs 4,894 crore in the corresponding quarter previous year. The EBITDA margins have declined from 11.4% in Q2FY23 to 11% in Q2FY24.

Profits: For Q2FY24, L&T reported a consolidated PAT of Rs 3,223 crore, registering a high growth of 45% compared to the corresponding quarter of the previous year. In the year-ago period, the company reported a PAT of Rs 2,223 crore. 

Order Inflows: The company received orders worth Rs 89,153 crore at the group level during the September quarter, registering a strong YoY growth of 72%. The international orders reported were Rs 59,687 crore during the quarter, comprising 67% of the total order inflow. The consolidated order book of the group is at Rs 4,50,734 crore as of September 30, 2023, with international orders having a share of 33%. 

Performance of Different Segments

Below is the performance of different segments of L&T in Q2FY24:

Infrastructure Projects Segment: The Infrastructure Projects segment secured an order inflow of Rs 27,990 crore during the quarter that ended September 30, 2023, registering a growth of 12% YoY on receipt of some large value orders across the various sub-segments. International orders at Rs 6,775 crore constituted 24% of the total order inflow of the segment. The segment order book stood at Rs 3,04,497 crore as of September 30, 2023, with the share of international orders at 23%. The segment posted customer revenues of Rs 24,613 crore, a 27% YoY growth. 

Energy Projects Segment: The Energy Projects segment secured orders valued at Rs 40,141 crore in Q2FY24, with the receipt of two ultra-mega international orders in the Onshore vertical of the Hydrocarbon business. International order inflow constituted a significant portion of the total order inflow.  

Energy Projects Segment order book crossed Rs 1,00,000 crore for the first time ever, taking the segment order book to Rs 1,06,802 crore, with the international order book constituting 79%. The segment achieved customer revenues of Rs 6,788 crore, recording a growth of 22% YoY.

Hi-Tech Manufacturing: The Hi-Tech Manufacturing segment secured orders valued at Rs 2,395 crore in FY24, registering a healthy growth of 35% YoY, with the receipt of a key order in the Defence Engineering business. Export orders constituted 8% of the total order inflow of the segment during the quarter. The order book of the segment was at Rs 25,958 crore, with the share of export orders at 10%. It posted customer revenues of Rs 1,886 crore, registering a growth of 30%

IT & Technology Services (IT&TS) Segment: The segment recorded customer revenues of Rs 11,182 crore for Q2FY24, registering a modest YoY growth of 7%, reflective of the growing demand for tech-enabled services in the IT&TS sector. International billing contributed 92% of the total customer revenues of the segment. The aggregate revenue of the two listed subsidiaries (LTIMindtree and L&T Technology Services Limited) in this segment at $1,364 million registered a YoY growth of 4% in USD terms. 

Development Projects Segment: The segment recorded customer revenues of Rs 1,849 crore, registering a healthy growth of 38% compared to the corresponding quarter of the previous year, driven by the monetization of commercial property in Hyderabad Metro. 

Outlook

The recent conflict in the Middle East has raised concerns about the potential increase in crude prices that can worsen the already fragile global economic situation, as the region is a crucial supplier of energy and a key shipping gateway to global trade. Despite this, the company remains optimistic around fresh project awards in Oil & Gas, industrialization, and energy transition projects in the GCC region.