Equity

• Upside in revenue came from both service and non service business of the company. While the services business revenue was up by 4% to Rs 10222.17 crore that of non-services business was up 10% to Rs 38321.63 crore. PBIT (excluding the figures of discontinued E&A business in corresponding previous period) was up 24% to Rs 6397.15 crore with PBIT margin rose from 11.6% to 13.2%.  The upside in PBIT was driven by strong growth in both services and non services business with former register a growth of 43% to Rs 2096.78 crore and that of latter was up 16% to Rs 4300.37 crore.
• Sales of core infrastructure segment has gone up 4% to Rs 26436.69 crore (accounting for 54.46% of total sales).  Sales of Power segment has gone up 116% to Rs 1220.21 crore (accounting for 2.51% of total sales).  Sales of Heavy Engineering segment has gone up 54% to Rs 1081.94 crore (accounting for 2.23% of total sales).  Sales of hydrocarbon segment has gone up 9% to Rs 5421.69 crore (accounting for 11.17% of total sales).   Sales of development projects segment has gone up 13% to Rs 1113.77 crore (accounting for 2.29% of total sales).  Sales of defence engineering segment has gone up 43% to Rs 1140.84 crore (accounting for 2% of total sales). 
• Sales of ITTS segment has gone up 5.94% to Rs 6,845.43 crore (accounting for 14.10% of total sales).  Sales of financial services segment has gone up 0.33% to Rs 3,376.74 crore (accounting for 6.96% of total sales).  
• PBIT of infra segment rose 7% to Rs 2795.52 crore (accounting for 43.70% of total PBIT).  PBIT of power segment fell 53% to Rs 94.93 crore (accounting for 1.48% of total PBIT).  PBIT of HE segment rose 166% to Rs 280.61 crore (accounting for 4.39% of total PBIT).  PBIT of hydrocarbon segment rose 31% to Rs 658.32 crore (accounting for 10.29% of total PBIT).  PBIT of development project segment rose 580% to Rs -65.18 crore (accounting for -1.02% of total PBIT).  PBIT of defence enggsegment rose 225% to Rs302.83 crore (accounting for 5% of total PBIT).  
• PBIT of ITTS segment rose 34% to Rs 1,366.02 crore (accounting for 21.35% of total PBIT).  PBIT of FS segment rose 63.59% to Rs 730.76 crore (accounting for 11.42% of total PBIT).  
• PBIT margin of core infra segment rose from 10.3% to 10.6%.  PBIT margin of power segment fell from 35.9% to 7.8%.  PBIT margin of HE segment rose from 15.1% to 25.9%.  PBIT margin of hydrocarbon segment rose from 10.1% to 12.1%.  PBIT margin of development projects segment fell from negative 1.0% to negative 5.9%.  PBIT margin of Defence Enggsegment rose from 11.7% to 26.5%.  
• PBIT margin of ITTS segment rose from 15.8% to 20%.  PBIT margin of FS segment rose from 13.3% to 21.6%.  

Yearly performance

Net sales (including other operating income) has declined 7% to Rs 135979.03 crore.  Operating profit margin expanded by 30 bps to 11.5% from 11.2%, leading to 4% fall in operating profit to Rs15624.10 crore.  Other income rose 45% to Rs 3429.35 crore.  Provision for interest rose 40% to Rs3913.44 crore.  Provision for depreciation rose 18% to Rs 2904.21 crore.  Profit before tax shrink 9% to Rs 12235.80 crore.  Provision for tax was expense of Rs 4,010.82 crore, compared to Rs 3,263.20 crore.  Effective tax rate was 32.8% compared to 24.3%.Share of profit/loss from associate was down 80% lower at Rs 14.4 crore.  Thus PAT after share of profit from associate was down 20% to Rs 8239.38 crore. EO net of tax was an expense of Rs 3556.02 crore against nil. Profit from discontinued business was higher at Rs 8237.92 crore against Rs 654.57 crore in the corresponding previous period. Minority interest decreased 1% to Rs 1,338.35 crore.  Net profit attributable to owners of the company was higher by 21% to Rs 11582.93 crore.

• Downside in revenue (excluding the figures of divested E&A biz) was largely due to sharp 11% fall in revenue of non-services business to Rs 98260.86 crore. But that of services business was up 8% to Rs 39022.31 crore. Sales of core infra segment has gone down 14.75% to Rs 61,961.64 crore (accounting for 44.61% of total sales).  
• PBIT (excluding the figures of discontinued E&A business in corresponding previous period) was down 11% to Rs14341.76 crore with PBIT margin contract by marginal 50 bps to 10.4%.  The downside in PBIT was driven by lower profit by both services and non services business. PBIT of services was down 4% to Rs 6107.98 crore dragged largely by FS business. PBIT of ITTS segment rose 31% to Rs 4,823.20 crore (accounting for 33.43% of total PBIT).  PBIT of FS segment fell 52% to Rs 1,285.78 crore (accounting for 8.91% of total PBIT).  PBIT of core infra segment fell 13% to Rs 4,521.54 crore (accounting for 31.34% of total PBIT).  

Order book

The consolidated order book of the group stood at Rs 327,354 crore as at March 31, 2021, registering a robust growth of 8% over March 31, 2020. International orders constitute 21% of the total order book

The order inflow for the quarter January-March 2021 atRs 50,651 crore, lower by 12% over corresponding period of the previous year with deferment of awards. Significant orders during the quarter were received in various segments like Factories, Hydel and Tunnel, Metros, Special bridges, Nuclear power, Rural water, Renewable energy, Hydrocarbon offshore and Minerals and metal sector. International orders at Rs18,439 crore during the quarter is at 36% of the total order inflow, with receipt of biggest Solar PV plant order and Transmission line orders.

The Company received orders worth Rs 175,497 crore at the group level during the year ended March 31, 2021, registering decline of 6% compared to the previous year in the face of Covid disrupted business environment in first half of the year. International orders at Rs 47,951 crore during the year dropped to 27% of the total order inflow, with subdued overseas opportunities, especially in Middle East.

Other developments

The Board of Directors recommended a final dividend of Rs18 per equity share of face value of Rs 2 each in addition to the special dividend of Rs 18 per equity share declared on October 28, 2020.

Outlook

Outlook During the year FY 2020-21, India despite stiff lockdowns, reverse labour migration, supply chain disruptions, a resultant deep GDP contraction, still did well to recover to the path of economic recuperation and full recovery. Large constituents of the economy recovered to the pre Covid-19 level of activity in a phased manner. The economy which made a resilient comeback during the later part of FY 2020-21, is once again at the crossroads, with the onset of a more ferocious second wave of the Covid-19 pandemic, impacting many states. This is expected to temporarily slow down the growth momentum, especially during the first quarter of FY 2021-22. Once the immediate challenges of shortages in health infrastructure and availability of vaccines get resolved, it is expected that with a controlled implementation of specific lockdowns in localized containment zones and strict adherence to Covid-19protocols, the economy would once again recover back with the resumption of near normalized activity in sectors like agriculture, manufacturing, mining, construction and non-contact based services. The investment focussed Union Budget 2021 and the growth supportive measures taken by the Government viz. increased allocations for capital expenditure under the NIP, the expanded production-linked incentives (PLI) scheme, FDI policy, and the ease of doing business will only reinforce the process of economic revival. The support by a credit expansive interest regime will provide further fillip to the investment climate. Elsewhere, most parts of the global economy is gradually recovering from the impact of the Covid-19 pandemic, but it still continues to remain uneven across countries with economic activity in many countries still below pre-Covid-19 levels. On the positive side, large scale vaccination drives, sustained accommodative monetary policies, government stimulus packages to citizens and small businesses support a vastly improved global economic outlook for 2021. The hardening of energy and metal prices only confirms this view. In the backdrop of the Covid-19 pandemic and the resultant challenging economic environment, the Company while upholding the primary dictum of maintaining the health and safety of its personnel will continue to aggressively pursue opportunities for growth, both in domestic and international markets. The focus would be on large project wins, efficient execution of its large order book, productive utilization of its monetary resources, all targeted to ensure a sustainable business model and thereby improved shareholder return.

Larsen & Toubro: Consolidated Results

Larsen & Toubro: Segment Results

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