L&T Q1 net profit jumps 14% to Rs 4,123 crore, revenue up 7%
- Net profit rose 14% to Rs 4,123 crore, beating analyst expectations.
- Revenue increased 7% year-on-year, driven by robust order inflows.
- US-Iran conflict weighed on margins and West Asia order inflow, the company said.
Larsen & Toubro (L&T) reported a 14% jump in consolidated net profit for the first quarter of FY27, coming in at Rs 4,123 crore. The figure surpassed Street estimates, which had projected a profit rise of around 12%.
Revenue for the quarter grew 7% compared to the same period last year, the engineering and construction giant said in its earnings release. Strong order inflows across domestic and international projects drove the top line.
Order book remains strong
The company's order book continues to provide visibility. Management attributed the quarterly performance to execution momentum in the infrastructure and hydrocarbon segments.
New orders during the quarter were robust, though the company did not disclose a specific figure. The order pipeline remains healthy, particularly in the domestic market.
Headwinds from geopolitical tensions
L&T's margins were trimmed during the quarter, partly due to the ongoing US-Iran conflict. The company noted that the geopolitical situation weighed on operations and order inflows in the West Asia region.
West Asia has historically been a key market for L&T's hydrocarbon and infrastructure businesses. The company is monitoring the situation closely and has not yet revised its full-year guidance.
Segment-wise performance
The infrastructure segment, L&T's largest, posted steady revenue growth. The hydrocarbon segment saw a slight dip in margins due to project mix and higher input costs.
The company's financial services arm also contributed positively to the bottom line. IT and technology services revenue grew in line with the broader industry trend.
Cost pressures from raw materials and logistics were partially offset by better project execution and cost control measures.
What analysts are watching
Analysts had expected a relatively flat quarter due to slower execution in some large projects. The actual revenue and profit figures came in ahead of these conservative estimates.
Investors will now focus on the company's commentary on order inflows for the remainder of the fiscal year. The management's outlook on the West Asia situation and its impact on the order book will be key.
The company's shares traded higher following the announcement, reflecting the positive surprise on the bottom line.
L&T's next quarterly results will be watched for signs of sustained momentum and any further impact from global geopolitical risks on its international projects.