X

Sign up for Equitymaster's free daily newsletter, The 5 Minute WrapUp and get access to our latest Multibagger guide (2017 Edition) on picking money-making stocks.

This is an entirely free service. No payments are to be made.


Download Now Subscribe to our free daily e-letter, The 5 Minute WrapUp and get this complimentary report.
We hate spam as much as you do. Check out our Privacy Policy and Terms Of Use.
L&T: Performance driven by cement - Views on News from Equitymaster
 
 
  • PRINT
  • E-MAIL
  • FEEDBACK
  • A  A  A
  • Oct 24, 2001

    L&T: Performance driven by cement

    L&T has posted a sharp jump of 223% in profits during the second quarter ended 30th September 2001. The improvement in performance is driven by an expansion in operating margins and a decline in net interest expenditure. However, growth in sales in 2QFY02 was sluggish in account slower growth in EPC revenues.

    (Rs m) 2QFY01 2QFY02 Change 1HFY01 1HFY02 Change
    Gross Sales 17,412 17,758 2.0% 34,046 36,068 5.9%
    Other Income 633 693 9.4% 960 1,150 19.8%
    Expenditure 16,151 16,308 1.0% 31,317 32,464 3.7%
    Operating Profit (EBDIT) 1,261 1,450 15.0% 2,729 3,604 32.1%
    Operating Profit Margin (%) 7.2% 8.2%   8.0% 10.0%  
    Net Interest 1,024 902 -11.9% 1,862 1,844 -1.0%
    Depreciation 742 818 10.2% 1,493 1,635 9.5%
    Profit before Tax 128 424 231.4% 334 1,275 282.2%
    Tax 3 19 - 20 220 -
    Profit after Tax/(Loss) 125 405 223.9% 314 1,055 236.4%
    Net profit margin (%) 0.7% 2.3%   0.9% 2.9%  
    No. of Shares (eoy) (m) 249 249   249 249  
    Earnings per share* 2.0 6.5   2.5 8.5  
    *(annualised)            

    The star performer is the cement division, which incidentally the company plans to hive off into a subsidiary. Production and sale of cement during the aforesaid quarter have increased by 7.6% and 5.1% respectively. Average realisation for the first half of the current financial year has increased sharply by 18.3% to Rs 1,357 per tonne. Cartelisation has clearly benefited the company in 1HFY02 and one can expect a slower growth in realisation for the rest of the year in light of a subdued demand scenario. The company expects a growth of 5%-6% in cement demand and consequently the cement prices are likely to be stable. The Durgapur grinding unit project is expected to be commissioned by the end of December 2001 and would increase the cement capacity to 16 million TPA.

    On the other hand, sluggish industrial production and slower GDP growth has affected the EPC division of the company. Nevertheless, given the leadership position of the company, it has register a 12% growth in EPC contracts by Rs 30 bn. The segment achieved revenues of Rs19 bn, accounting for 52% of the company’s total sales & service income. The sales figure reflects sluggish growth, mainly due to the job mix of order backlog getting skewed in favour of long-cycle jobs and some large orders bagged late last year still at initial execution stage.

    Net profit for 1HFY02 stood at Rs 1,055 m, a growth of 236% as compared with the corresponding period of the previous year. This was primarily led a 200 basis points increase in margins and a fall in interest costs, which has been slowing profit growth until now.

    The scrip is currently trading at Rs 164 at a P/E multiple of 19.5x annualised 1HFY02 earnings.

     

     

    Equitymaster requests your view! Post a comment on "L&T: Performance driven by cement". Click here!

      
     

    More Views on News

    L&T: Amidst a Challenging Business Environment (Quarterly Results Update - Detailed)

    Aug 1, 2017

    Bank credit to industry remained muted and investment momentum was driven mostly by public sector spending.

    L&T: Private Sector Capex Remains in a Tizzy (Quarterly Results Update - Detailed)

    Jul 24, 2017

    Vast majority of private players remain more concerned with debt payback rather than starting new projects.

    L&T: Demonetisation Blues (Quarterly Results Update - Detailed)

    Feb 8, 2017

    Larsen & Toubro (L&T) has announced third quarter results of financial year 2016-2017 (3QFY17). The company has reported 1.7% YoY growth in sales while profits have grown 38.9% YoY. Here is our analysis of the results.

    UltraTech: Post-Acquisition Cement Capacity Augmented to 93 MTPA (Quarterly Results Update - Detailed)

    Aug 11, 2017

    UltraTech Cement completed the acquisition of cement plants of Jaiprakash Associates Limited (JAL) and Jaypee Cement Corporation Limited (JCCL) during the quarter ended June 2017.

    Ambuja Cement: Fall in Other Income Drag Bottomline Lower (Quarterly Results Update - Detailed)

    Aug 11, 2017

    While topline witnessed growth on the back of higher cement sale volumes, a 50.5% YoY fall in other income weighed on Ambuja's bottomline during the quarter ending June 2017.

    More Views on News

    Most Popular

    A 'Backdoor' to Multibaggers: It's Like Investing in Asian Paints Ten Years Ago(The 5 Minute Wrapup)

    Aug 10, 2017

    Don't miss these proxy bets on growing companies or in a few years you will be looking back with regret.

    The Most Important Innovation in Finance Since Gold Coins(Vivek Kaul's Diary)

    Aug 10, 2017

    Bill connects the dots...between money and growth, real money and real resources, gold and cryptocurrencies...and between gold, cryptocurrencies, and time.

    Signs of Life in the India VIX(Daily Profit Hunter)

    Aug 12, 2017

    The India VIX is up 36% in the last week. Fear has gone up but is still low by historical standards.

    Bitcoin Continues Stellar Rise(Chart Of The Day)

    Aug 10, 2017

    Bitcoin hits an all-time high, is there more upside left?

    5 Steps To Become Financially Independent(Outside View)

    Aug 16, 2017

    Ensure your financial Independence, and pledge to start the journey towards financial freedom today!

    More
    Copyright © Equitymaster Agora Research Private Limited. All rights reserved.
    Any act of copying, reproducing or distributing this newsletter whether wholly or in part, for any purpose without the permission of Equitymaster is strictly prohibited and shall be deemed to be copyright infringement.

    LEGAL DISCLAIMER: Equitymaster Agora Research Private Limited (hereinafter referred as 'Equitymaster') is an independent equity research Company. Equitymaster is not an Investment Adviser. Information herein should be regarded as a resource only and should be used at one's own risk. This is not an offer to sell or solicitation to buy any securities and Equitymaster will not be liable for any losses incurred or investment(s) made or decisions taken/or not taken based on the information provided herein. Information contained herein does not constitute investment advice or a personal recommendation or take into account the particular investment objectives, financial situations, or needs of individual subscribers. Before acting on any recommendation, subscribers should consider whether it is suitable for their particular circumstances and, if necessary, seek an independent professional advice. This is not directed for access or use by anyone in a country, especially, USA or Canada, where such use or access is unlawful or which may subject Equitymaster or its affiliates to any registration or licensing requirement. All content and information is provided on an 'As Is' basis by Equitymaster. Information herein is believed to be reliable but Equitymaster does not warrant its completeness or accuracy and expressly disclaims all warranties and conditions of any kind, whether express or implied. Equitymaster may hold shares in the company/ies discussed herein. As a condition to accessing Equitymaster content and website, you agree to our Terms and Conditions of Use, available here. The performance data quoted represents past performance and does not guarantee future results.

    SEBI (Research Analysts) Regulations 2014, Registration No. INH000000537.

    Equitymaster Agora Research Private Limited. 103, Regent Chambers, Above Status Restaurant, Nariman Point, Mumbai - 400 021. India.
    Telephone: +91-22-61434055. Fax: +91-22-22028550. Email: info@equitymaster.com. Website: www.equitymaster.com. CIN:U74999MH2007PTC175407
     

    Become A Smarter Investor In
    Just 5 Minutes

    Multibagger Stocks Guide 2017
    Get our special report, Multibagger Stocks Guide (2017 Edition) Now!
    We will never sell or rent your email id.
    Please read our Terms

    L&T SHARE PRICE


    Aug 22, 2017 (Close)

    TRACK L&T

    L&T 5-YR ANALYSIS

    Detailed Financial Information With Charts

    COMPARE L&T WITH

    MARKET STATS