NEW DELHI: Shares of engineering major Larsen & Toubro (L&T) gained as much as 4 per cent in early Mumbai trading on Thursday despite a decline of 67 per cent on-year in net profit in the July-September as investors took heart from better margins in projects and manufacturing amid signs of a decline in the coronavirus crisis.
The company’s scrip touched a high of Rs 1,862 on the National Stock Exchange, up from Rs 1,784.55 at the previous close. At 10.15 am, the stock was trading 3.64 per cent higher at Rs 1,849.45 while the NSE Nifty shed 0.68 per cent to 18,093 at the same time.
The company, which declared its second-quarter earnings post-market hours on Wednesday, said its reported profit was at Rs 1,819.45 crore in the July-September quarter as against Rs 5,520.27 crore a year ago.
However, consolidated adjusted profit on a yearly basis jumped 56 per cent year-on-year (YoY) to Rs 1,723 crore in the said quarter. This was primarily on account of the higher profits in the IT & Technology services book and from the projects and manufacturing book.
Adjusted profit did not include exceptional items and operations that were discontinued.
For the quarter under review, L&T’s consolidated revenue stood at Rs 34,773 crore, showing a growth of 12 per cent on a yearly basis.
The company raked in orders worth Rs 42,140 crore in the September 2021 quarter, corresponding to a growth of 50 per cent over the same period last year. For the first six months of the financial year, the order book was at Rs 68,697 crore, registering a growth of 33 per cent on a yearly basis.
“L&T rightly prioritized balance sheet strength over growth during the second COVID wave. Labour availability no longer poses a challenge, and execution is expected to improve from hereon as construction activity picks up post-monsoon. We believe that L&T is poised for a strong earnings growth momentum, if and when the order inflow gains momentum,” said brokerage
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