For the quarter ended March 31, the overall Profit After Tax (PAT), including the PAT from discontinued operations at Rs 3,197 crore, dipped by six per cent over the figure for the similar period last year
Engineering conglomerate Larsen & Toubro (L&T) on Friday reported a 14 per cent year-on-year (YoY) drop in consolidated profit before tax (PBT) at Rs 4,249.7 crore for the quarter ended March 31 (Q4FY20). This was also lower than the consensus estimate of Rs 4,567.2 crore, according to Bloomberg poll of analysts.
The company did not provide order inflow and revenue guidance for the current financial year because of Covid-19.
The company does not expect revival of capital expenditure in the private sector this year. SN Subrahmanyan, chief executive officer and managing director for L&T, said sales missed so far because of the Covid-19 disruption would be around Rs 15,000-17,000 crore. “We know April-May was tough. We are gathering our thoughts and will wait for more time before we come up with guidance,” he said.
In its statement, the company said, while the initial quarters of FY21 are expected to be adversely affected, it expects growth revival in the later part of the financial year, assuming things get better from here.
On labour availability, he said L&T has 40 per cent of its usual labourers on site. “Around 100,000 labourers are yet to return, which should take 15-30 days. We experience this every year as labour returns home for Holi and for harvest season.”
On whether L&T will look to reduce costs, he said: “L&T has a highly disciplined, hard working set of individuals. If they feel the company requires them to make some sacrifices they will do that. At the moment, that is the way we look at it.”
For the quarter, L&T’s profit after tax (PAT), including the PAT from discontinued operations, was Rs 3,197 crore, a decline of 6 per cent YoY, as tax outgo fell by 22 per cent. Thus, PAT was ahead of expectations of Rs 3,062 crore.
Revenue from operations for Q4, when the impact of Covid-19 on global economy started showing, was Rs 44,245 crore, witnessing a 2 per cent YoY rise and better than Street expectations of Rs 43,896 crore. Company executives said much of the hit on revenue was from March as customers could not physically inspect deliveries and stockists started to reduce off-take.
Order inflow for the March quarter was Rs 57,785 crore. For the full year, order inflow stood at Rs 1.86 trillion, a growth of 9 per cent. L&T missed its guidance of order inflow growth of 10-12 per cent in FY20. It expects new orders this year to be dependent on government funded and multilateral funded orders.
As of March 2020, L&T has an outstanding order book of Rs 3.04 trillion, 4 per cent higher than the previous year. On whether there are any order deferrals and cancellations, Subrahmanyan said, “There are no discussions on cancellation of orders. There are discussions with some for postponement of orders and some of advancing orders. It is a mixed bag.”
The firm said sale of its electrical and automation business was disrupted because of Covid and the process will progress after the lockdown.