Engineering and construction major Larsen & Toubro reported a 4.3% growth in net profit at Rs 798 crore for the second quarter, against the corresponding quarter in the previous fiscal, as profit margins plunged due to tough competition for new contracts.
Revenues for the quarter grew 20% to Rs 11,245 crore over the same period last year.
Delays in investment decisions in various sectors has impacted order flow, according to R Shankar Raman, chief financial officer, Larsen & Toubro.
The company has revised its order growth forecast from 15% to 5% for the full year. L&T's order book now stands at Rs 1,42,185 crore with order inflow of Rs 16,096 crore during the July-September quarter.
The company said the current slowdown in investment momentum in almost all sectors of the economy is constraining growth opportunities. "Intensifying competition, high inflation, elevated interest rate and delayed policy intervention are posing challenge for the decision makers," it said.
The downward revision of order growth projections and negative outlook seem to have impacted investor sentiments. Following the results, L&T's stock closed 3.54% down at Rs 1336 on BSE on Friday.