Larsen & Toubro Q4 Results Update

On 12th May 2022, Larsen & Toubro announced its quarterly results for the last quarter of FY2022.

Key Highlights:

- Larsen & Toubro achieved Consolidated Revenues of ₹ 156,521 crores for FY22 with a growth of 15% YoY with strong execution in project business aided by continuing growth momentum in the IT&TS portfolio. International revenues during the year at ₹ 55,783 crore constitute 36% of the total.

- For Q4FY22, the Consolidated Revenues at ₹ 52,851 crores with a YoY growth of 10%. International sales during the quarter at ₹ 17,550 crores constituted 33% of the total revenue

- For FY22, the Consolidated Net PAT (excluding exceptional items and discontinued operations) at ₹ 8,572 crore registered a robust growth of 23%. 

- The Consolidated Net PAT for Q4FY22 at ₹ 3,621 crore, registered a growth of 10% QoQ.

- The Company bagged orders worth ₹ 73,941 crores during Q4FY22, registering a strong growth of 46% over Q4FY21, with the Infrastructure segment booking a mega order from the Middle East. The International orders at ₹ 32,241 crores during the quarter comprised 44% of the total order inflow. 

Infrastructure Segment:

- The Infrastructure segment secured order inflow of ₹ 93,515 crores, during FY22, with a drop of 9% YoY which had receipt of the large value Mumbai – Ahmedabad High-Speed Rail orders. The segment order book stood at ₹ 260,624 crores for FY2022, with the share of international orders at 22%.

- The segment recorded customer revenues of ₹ 29,727 crores for Q4FY22, registering growth of 13% YoY.

- International revenues constituted 25% of the total customer revenues of the segment during the quarter. 

- The EBITDA margin of the segment for FY2022 was at 8.2% vis-à-vis 8.5% recorded in FY2021. The drop in margin is primarily due to unreasonably high commodity prices.

Hydrocarbon Segment:

- The Hydrocarbon Segment secured orders valued at ₹ 30,912 crores during FY2022, registering a strong growth of 74% YoY with the receipt of mega orders from the Middle East, both in the Offshore and Onshore verticals. International order inflow constituted 79% of the total order inflow of the segment.

- The segment order book was at ₹ 56,398 crores for FY2022, with the international order book constituting 60%. 

- The segment posted customer revenues of ₹ 5,237 crores during Q4FY22, recording a marginal decline of 3% YoY. International revenues had a share of 31% of the total customer revenues for the quarter. 

- The EBITDA margin of the segment at 8.7% for FY2022 declined to 9.2% over FY2021, reflecting input cost inflation and change in the composition of jobs amongst the sub-segments. 

- During the quarter, L&T Hydrocarbon Engineering Limited was merged with the Parent entity on the appointed date of April 01, 2021. 

Power Segment:

- The Power segment for FY2022, secured orders of ₹ 1,360 crores registering a growth of 39% compared to FY2021. 

- The order book of the segment was at ₹ 8,901 crores for FY2022, with the share of international orders at 6%. 

- The segment recorded customer revenues of ₹ 1,480 crores for Q4FY22, recording a growth of 22% over Q4FY21.

- The segment EBITDA margin for FY2022 was at 3.9%, lower compared to 4.6% in the previous year, due to the mix of jobs under execution.

Heavy Engineering Segment:

- The Heavy Engineering segment secured orders valued at ₹ 3,223 crore during FY2022 registering a decline of 10% YoY due to deferral of targeted prospects.

- The order book of the segment was at ₹ 4,714 crores for FY2022, with the share of export orders at 39%. 

- For FY2022, customer revenues at ₹ 2,724 crores, remained flat over the previous year as new orders in the portfolio are still in the early stage of execution. 

- The EBITDA margin of the segment at 19.0% for FY2022 declined compared to 19.7% reported in the previous year, the drop is primarily due to lower export incentives. 

Defence Engineering Segment:

- The Defence Engineering segment secured orders valued at ₹ 8,079 crores during FY2022, representing substantial growth over the previous year with the receipt of a few large value domestic orders. 

- The order book of the segment was at ₹ 12,537 crores for FY2022, with export orders constituting 4% of the total order book. 

- For FY2022, the customer revenues at ₹ 3,218 crores registered a YoY decline of 5% over the previous year with tapering off large value orders under execution, coupled with delayed receipt of new awards. 

- The EBITDA margin for FY2022 at 20.2% was lower when compared to 22.2% in FY2021. The margins in the previous year had the benefit of the release of cost savings in some key projects that got completed. 

IT & Technology Services (IT&TS) Segment:

- The segment recorded customer revenues of ₹ 32,256 crores for FY2022, registering a YoY growth of 27% reflecting the continuing growth momentum in the sector with the surge in demand for technology-focused offerings.

- The segment recorded customer revenues of ₹ 8,761 crores for Q4FY22, recording QoQ growth of 4% & YoY growth of 30%. 

- The EBITDA margin for the segment at 23.6% for FY2022, is in line with the previous year at 23.5% as gains through better resource utilization got offset by higher employee costs.

Financial Services Segment:

- The segment recorded income from operations at ₹ 11,971 crores for FY2022, registering a decline of 11% YoY, mainly attributed to the targeted reduction in the overall loan book. 

- The segment recorded income from operations at ₹ 2,963 crores during Q4FY22, registering a YoY decline of 12%. 

- The segment EBIT for FY2022 increased to ₹ 1,470 crore as compared to ₹ 1,286 crore in FY2021 due to lower credit costs.

Developmental Projects Segment:

- The segment recorded customer revenues of ₹ 4,368 crores registering a growth of 21% over the previous year, driven by a higher PLF in the Nabha Power plant and a gradual increase in metro ridership in Hyderabad. 

- For Q4FY22, the customer revenues at ₹ 1,096 crores, recording a marginal decline of 2%YoY. 

- The segment EBIT for FY2022 registers a loss of ₹ 231 crores.

Other Segment:

- Other segment comprises Realty, Construction & Mining Machinery, Rubber Processing Machinery, etc. 

- Customer revenues for FY2022 at ₹ 5,988 crores registered a growth of 2% over the previous year. 

- The customer revenues of this segment during Q4FY22 at ₹ 1,825 crores, is in line with the previous year. 

- During FY2022, the segment EBITDA margin at 17.4%, declined compared to 21% in FY2021, since it had the benefit of gaining on the sale of the commercial property in the Realty business. 

The Board of Directors has recommended a final dividend of ₹ 22 per equity share for the approval of shareholders, an increase of 22% per share over the previous year.