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L&T: Topline gets a boost from faster execution
May 26, 2016

Larsen & Toubro (L&T) has announced the fourth quarter results of financial year 2015-2016 (4QFY16). The company has reported 18.5% YoY growth in sales while net profits have grown 18.6% YoY. Here is our analysis of the results.

Performance summary
  • Consolidated net sales for the company grew by 18.5% YoY during 4QFY16.
  • Operating expenses for the company increased by 15.8% YoY. Operating profit grew 38.5% YoY in 4QFY16 as a result. Consequently, operating margin expanded to 13.8% from 11.8% in the corresponding quarter of last year.
  • Net profit grew by 18.6% YoY during the quarter.

    Financial performance snapshot (Consolidated)
    (Rs m) 4QFY15 4QFY16 Change FY15 FY16 Change
    Sales 276,871 328,122 18.5% 895,897 1,013,361 13.1%
    Expenditure 244,273 282,979 15.8% 779,233 902,890 15.9%
    Operating profit (EBDITA) 32,598 45,144 38.5% 116,664 110,471 -5.3%
    Operating profit margin (%) 11.8% 13.8% 13.0% 10.9%
    Other income 6,251 5,630 -9.9% 34,896 24,787 -29.0%
    Interest 4,686 7,737 65.1% 28,401 30,412 7.1%
    Depreciation 5,880 8,203 39.5% 54,464 27,560 -49.4%
    Exceptional items 984 485 - 3,477 3,581 -
    Profit before tax 29,267 35,319 20.7% 72,172 80,867 12.0%
    Tax 7,658 9,537 24.5% 22,532 25,487 13.1%
    Extraordinary items, net of tax 0 0 0 0
    Profit after tax/(loss) 21,609 25,782 19.3% 49,640 55,380 11.6%
    Net profit margin (%) 7.8% 7.9% 5.5% 5.5%
    Share in profit of associates -18 -15 21 -25
    Minority interest 895 1,230 2,013 4,450
    Profit after share of associates & minority interest 20,696 24,536 18.6% 47,648 50,905 6.8%
    No. of shares 931.2
    Basic reported earnings per share (Rs)* 54.7
    P/E ratio (x)* 26.9

    * On a trailing 12-months basis

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