Engineering and infrastructure conglomerate Larsen & Toubro Ltd. reported results that missed street expectations for the December quarter due to challenges seen in the manufacturing segment.

The company's revenue was in-line with expectations while net and operating profit missed estimates by low to mid-single-digits. EBITDA margin also contracted 80 basis points from the same period last year.

Net profit for the quarter increased 24 percent from last year and was aided by an exceptional gain of Rs 97 crore, which was due to the divestment of its mutual fund business. Despite the exceptional gain, the company's bottomline was lower than what the street anticipated.

The decline in EBITDA margin from last year was due to continuing cost pressures.

At the group level, the company received orders worth Rs 60,710 crore, which is a growth of 21 percent from last year. Orders were won across multiple segments like oil & gas, public spaces, hydel and tunnels, irrigation systems, ferrous metals and power transmission & distribution. A quarter or Rs 15,294 crore of total order inflow came from the overseas business.

As of December 31, L&T's consolidated order book stood at Rs 3.86 lakh crore, with a quarter of that coming from the international business.

Only the hi-tech manufacturing segment of L&T saw a decline in order flow during the quarter. Overall orders for this segment declined 36 percent from last year due to subdued ordering witnessed in the defence engineering business.

L&T's management said that it expects private capex to pick up in areas like energy transformation, emerging technologies, healthcare, logistics, industrial parks, data centers etc.

The management also said that it expects oil prices to remain firm at current levels. Speaking of international orders, the company said that GCC nations are looking to invest in sectors besides oil, such as industrial and green investments.

Shares of L&T ended 1.7 percent lower at Rs 2,122.05.

First Published:Jan 30, 2023 4:29 PM IST