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HindustanTimes Wed,16 Apr 2014

Bumps ahead? Larsen and Toubro Q1 net dips 13% to Rs. 756 cr, stock plunges

HT Correspondent, Hindustan Times  Mumbai, July 23, 2013
First Published: 00:07 IST(23/7/2013) | Last Updated: 00:10 IST(23/7/2013)

India’s largest engineering and construction company, Larsen & Toubro (L&T), on Monday reported a 12.5% year-on-year decline in net profit to Rs. 756 crore during the April-June quarter against Rs. 864 crore a year ago on the back of subdued revenue growth.

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This points to more speed bumps ahead for India’s construction sector as the economic slowdown takes a toll on infrastructure spending.

The results, which missed analyst estimates of Rs. 950 crore, sent the company’s shares down 7.5% to Rs. 902 on the BSE.

Revenue was hit by a 44% fall in the power business segment to Rs. 1,275 crore and an 18% fall in metallurgical and material handling businesses to Rs. 1,087 crore.

“The fact is the situation is very challenging on the ground," said Krishnamurthi Venkatara­manan, CEO, L&T. “The situation, for the next two years, looks challenging from the Indian context.”

However, revenue from the infrastructure business grew 22% to Rs. 5,461 crore, while that from the hydrocarbon business was up 24% at Rs. 2,776 crore.

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