Larsen & Toubro Ltd. - Q3 FY23 Earning Highlights | Globe Capital Market LTD.
Larsen & Toubro Ltd. – Q3 FY23 Earning Highlights

Robust domestic order inflows, Strong prospects pipeline & execution growth driven by combination of higher opening order book and improved customer collections.

Q3 FY23 Earning Overview and Verdict
Rs. 2114
Beats the market estimates

Earning Highlights Q3FY23:

  • Larsen & Toubro achieved Consolidated Revenues of ₹ 46,390 crore for the quarter ended December 31, 2022 recording a y-o-y growth of 17%, aided by improved execution in the Infrastructure Projects segment and continued growth momentum in the IT&TS portfolio. International revenues during the quarter at ₹ 17,317 crore constituted 37% of the total revenue.
  • Total Consolidated Profit after Tax (PAT) of ₹ 2,553 crore, registering a robust growth of 24% over the corresponding quarter of the previous year. The PAT includes an exceptional gain of ₹ 97 crore (net), attributed to profit on divestment of the Mutual Fund business of the Financial Services segment off-set by a one-time charge due to remeasurement of the wholesale loan assets of the Financial Services segment at fair value.
  • The recurring PAT for the quarter at ₹ 2,456 crore evidenced an increase of 20% as compared to the PAT of ₹ 2,055 crore for the corresponding quarter of the previous year.
  • Order Books: The Company received orders worth ₹ 60,710 crore at the group level during the quarter ended December 31, 2022, registering a growth of 21% over the corresponding quarter of the previous year.
  • On a cumulative basis, the order inflow for the nine months ended December 31, 2022 stood at ₹ 154,429 crore, registering a growth of 30% y-o-y. International orders at ₹ 50,478 crore constituted 33% of the total.
  • The consolidated order book of the group was at ₹ 386,588 crore as on December 31, 2022, with international orders having a share of 26%.

Industry Outlook: The Indian economy continues to stay resilient amidst geopolitical uncertainties, slowing global trade, disrupted supply chains, volatile commodity prices and rising interest rates. Structural reforms carried out in the country over the past several years are helping the country to regain a sustainable growth momentum despite the persisting global challenges.

The Government is likely to continue the emphasis on infrastructure spending while providing subtle support to consumption and addressing the need for investing in new age technologies to combat the climate change risks.

Valuation & View:

At the CMP of Rs. 2114, the stock is trading at ttm P/E multiple of 35 times with the ttm EPS of Rs. 60.03, which is fairly valued.



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