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L&T: Other income saves the day - Views on News from Equitymaster
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L&T: Other income saves the day
Feb 2, 2016

Larsen & Toubro (L&T) has announced the second quarter results of financial year 2015-2016 (3QFY16). The company has reported 7.6% YoY growth in sales while net profits have grown 19.4% YoY. Here is our analysis of the results.

Performance summary

  • Consolidated net sales for the company grew by 7.6% YoY during 3QFY16.
  • Operating expenses for the company increased by 10.6% YoY. Operating profit fell by 15.9% YoY in 3QFY16 as a result. Consequently, operating margin contracted to 8.7% in 3QFY16 from 11.1% in the corresponding quarter of last year.
  • Net profit grew by 19.4% YoY during the quarter.

Financial performance snapshot (Consolidated)

(Rs m) 3QFY15 3QFY16 Change 9MFY15 9MFY16 Change
Sales 235,887 253,872 7.6% 619,025 685,238 10.7%
Expenditure 209,621 231,794 10.6% 562,553 619,433 10.1%
Operating profit (EBDITA) 26,267 22,078 -15.9% 56,473 65,805 16.5%
Operating profit margin (%) 11.1% 8.7%   9.1% 9.6%  
Other income 4,959 8,938 80.3% 28,077 18,794 -33.1%
Interest 9,183 7,446 -18.9% 23,788 22,791 -4.2%
Depreciation 6,791 6,198 -8.7% 20,350 19,356 -4.9%
Exceptional items - - - 2,493 3,096 -
Profit before tax 15,252 17,372 13.9% 42,905 45,548 6.2%
Tax 5,693 5,555 -2.4% 14,875 15,949 7.2%
Extraordinary items, net of tax - -   - -  
Profit after tax/(loss) 9,559 11,816 23.6% 28,031 29,598 5.6%
Net profit margin (%) 4.1% 4.7%   4.5% 4.3%  
Share in profit of associates 17 -20   39 -10  
Minority interest 911 1,449   1,118 3,220  
Profit after share of associates & minority interest 8,665 10,348 19.4% 26,952 26,369 -2.2%
No. of shares         931.2  
Basic reported earnings per share (Rs)*         50.5  
P/E ratio (x)*         21.8  

* On a trailing 12-months basis

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