L&T Q1 profit jumps 36% to Rs 3,116.12 crore; board approves Rs 10,000 crore buyback plan

Infrastructure major Larsen and Toubro (L&T) on Tuesday posted a 36 per cent rise in net profit to Rs 3,116.12 crore in the June quarter, mainly aided by execution of a healthy order book in its projects and manufacturing portfolio. The company's board has approved buy back of shares worth up to Rs 10,000 crore.

According to a regulatory filing, the total income increased to Rs 49,027.93 crore in the first quarter of the current fiscal from Rs 36,547.92 crore in the year-ago period. It had a net profit of Rs 2,293.01 crore in the corresponding period of 2022-23.

Also Read | L&T, Navantia sign a Teaming Agreement for submarine programme

L&T's expenses in the June quarter rose to Rs 44,695.56 crore from Rs 33,619.24 crore a year ago. The Board of Directors of the company has approved a proposal to buy back shares worth up to Rs 10,000 crore, excluding tax on the buyback. The proposal is subject to the approval of shareholders. Further, the board has cleared a special dividend of Rs 6 per equity share.

"The Q1 FY24 performance is on the back of a robust topline and bottomline growth, supported by excellent balance sheet management, resulting in improved return ratios.

"We are walking the talk by returning surplus cash to shareholders in our journey to improve the group return ratios over the Lakhshya Strategic Plan period ending FY26," S N Subrahmanyan, Chief Executive Officer and Managing Director of L&T, said in a statement.

He said the capex buoyancy in India & GCC (Gulf Cooperation Council) is providing the much-needed tailwinds for growing the company's projects and manufacturing portfolio, ably supported by the resilient performance of the services businesses. The company's board has approved an additional investment of up to Rs 506 crore in its subsidiary L&T Energy Green Tech Ltd.

Besides, the board gave its approval for incorporation of a joint venture company for green energy business with an initial subscribed capital of Rs 1 crore and acquisition of entire shareholding of Sapura Nautical Power Pte Ltd (joint venture partner) in L&T Sapura Offshore Pvt Ltd (LTSOPL).

The company said it received orders worth Rs 65,520 crore at the group level in the latest June quarter, registering a strong y-o-y growth of 57 per cent.

During the quarter, the orders were received across diverse segments like rail, renewables, rural water supply, transmission and distribution, IT & office space and onshore & offshore verticals of the hydrocarbon business. International orders worth Rs 27,646 crore during the quarter accounted for 42 per cent of the total order inflow.

The consolidated order book of the group stood at Rs 412,648 crore as on June 30. L&T said India's real GDP growth of 7.2 per cent in FY 2022-23 was amplified by strong capital formation.

Further, domestic economic activity has remained resilient in Q1 FY 2023-24 as reflected by the buoyancy in various high frequency economic indicators. On the global front, major economies are turning around the corner, it noted.

Further, the company said falling energy prices and headline inflation, easing supply bottlenecks and the reopening of China's economy are some of the positive factors guiding the economy towards attaining the much needed growth.

Major oil producing nations continue to invest on oil & gas, industrialisation and energy transition initiatives, that will augur well for the company's projects business, it added.

In the backdrop of this mixed sentiment, the company said it will continue with the planned trajectory of profitable and return accretive growth, while the focus will remain on cash generation and judicious capital allocation.