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News: L&T reported a decent set of Q3FY24 results. The order inflow for 9MFY24 stood at ₹ 230,662 crore, up 49% YoY. International orders at ₹ 137,894 crore constituted 60% of the total. The inflows for Q3FY24 stood at ₹ 75,990 crore, up 25% YoY. The consolidated order book is at ₹ 469,807 crore as on Q3FY24 up 22% YoY. Consolidated Revenues of ₹ 55,128 crore for Q3FY24 up 19% YoY, aided by ramp up in execution of the strong order book in the Projects and Manufacturing portfolio. On the standalone basis revenues at ₹ 31600 crore, up ~14% YoY. Consolidated margins came in at 10.4% vs. 10.9% the miss is on account of lower margins in the infrastructure segment on account of legacy projects and mega projects not entering the threshold levels. Consequently, PAT grew by ₹ 2947 crore, up 20% YoY. The NWC continues to remain at very comfortable levels of 16.6%. On the guidance front, Order inflows.
Views: Given the strong ordering activity and pick up in execution, L&T is very well placed to exceed its guidance on order inflow and revenues. Even a strong backlog ensures robust visibility for growth in FY25-FY26. However, margins have been a weak point for L&T in 9MFY24 which we believe will materially improve once legacy orders are executed by Q4FY24. We maintain our positive on the company given strong pick up in capex cycle, improvement in cash flow and balance sheet.
Impact: Positive