Mumbai: Larsen & Toubro, the country’s biggest engineering company, posted a better-than-expected fiscal third-quarter profit and increased its sales forecast for the year after winning more orders at home and in the Middle East.
Net profit in the three months ended December 31 climbed 40% to Rs 482 crore, or Rs 16.21 a share, from Rs 344 crore, or Rs 11.24, a year earlier, Mumbai-based Larsen said in a statement on Monday. Sales rose 55% to Rs 6,380 crore.
Larsen, which held its board meeting in Dubai, the first time overseas, is winning orders for golf courses and power plants in Oman, helped by an oil-driven construction boom.
The company is also securing orders for blast furnaces for steel mills in India as rising prices spur local steelmakers to expand.
“Larsen stands to gain most from the growth in oil-rich economies and also locally as it is the leader in the high- technology engineering sector,” said R K Gupta, who manages $114 million of stocks, including Larsen shares, as chief executive officer at Credit Capital Asset Management in New Delhi. “It’s a good buy at any point.”
The company aims to boost the share of its overseas business to 30% from 20% in the next five years, helped by expansion in the Middle East and China.
Sales in the year ending March 31 will probably gain 40%, compared with its forecast of 25% made at the beginning of the year started April 1, chief financial officer Yeshwant M Deosthalee said in a telephone interview from Dubai.
The forecast was revised as the company began work on the New Delhi and Mumbai airports, each project estimated at about Rs 5,000 crore, he said.
New orders climbed 37% in the quarter to Rs 13,020 crore, Larsen said in an e-mailed statement. The engineering and construction unit won contracts worth Rs 11,462 crore.
The operating margin widened 50 basis points to 12% in the quarter. Interest payments more than tripled to Rs 43.84 crore after it converted about $200 million of its yen loans to dollars in September and another $280 million in January.
Source :
Dna
