Larsen and Toubro Technology Services Q3 FY22 Results
L&T Tech released its December quarter (FY22) earnings report.
The company reported a 33.5% year-on-year (YoY) increase in its PAT at Rs 249.6 crore from Rs 187 crore in Q3 FY21. On a sequential basis, the company’s PAT grew by 8%quarter-on-quarter (QoQ) from Rs 230 crore in Q2 FY22.
The company clocked a 20.5% YoY increase in the revenue from operations to Rs 1,687 crore from Rs 1,400 crore in the year-ago period. On a sequential basis, the revenue grew 5% from Rs 1,607 crore in Q2 FY22. The company’s total income increased to Rs 1,724.5 crore from Rs 1,449.5 crore on a yearly basis during the third quarter. However, the total income only rose marginally by 5% QoQ from Rs 1,637 crore.
Most segments reported flat revenue growth on account of the impending semiconductor shortage. L&T Tech’s stock closed in the red at Rs 5,420.5 per share after taking a 2.77% dip ahead of its quarterly earnings report on January 18, 2022 at the end of the intraday trading session.
Hits
- PAT up 33.5% YoY to Rs 249.6 crore from Rs 187 crore in the year ago period
- Gross profit up 32% YoY to Rs 569 crore from Rs 431 crore
- Revenue increases 20.5% YoY to Rs 1,687 crore from Rs 1,400 crore in the year ago period
- Total income jumps 19% to Rs 1,724.5 crore from Rs 1,449.5 crore in Q3 FY21
- The company declared an interim dividend of Rs 10 per share
- Basic Earnings per Share increases to Rs 23.61 from Rs 17.75 in the corresponding quarter in the previous financial year
Misses
- Other income declined by 30.7% YoY to Rs 25.9 crore from Rs 374 crore in the year ago period
- EBITDA margin, EBIT margin, and Net Income Margin remain largely flat
Segment-wise revenue
- Transportation: Revenue up by 26% YoY to Rs 537 crore from Rs 426 crore
- Plant Engineering: Revenue up by 26.7% YoY to Rs 260 crore from Rs 205 crore
- Industrial Products: Revenue up by 21.5% YoY to Rs 328 crore from Rs 270 crore
- Medical devices: Revenue up by 13% YoY to Rs 201 crore from Rs 178 crore
- Telecom & Hitech: Revenue up by 12.3% YoY to Rs 360 crore from Rs 320 crore
What the Management says
Amit Chadha, CEO & Managing Director, L&T Technology Services has said that the company sustained its performance with sequential growth of 4.2% in constant currency. This was led by strong demand across segments. The deal conversations and pipeline of the company’s six big bets – Electric Autonomous & Connected Vehicle (EACV), 5G, Med-tech, AI & Digital Products, Digital Manufacturing and Sustainability – continues to see healthy improvement. He further added that the company is expanding EACV global presence with the addition of an engineering R&D centre in Krakow, Poland that will strengthen its strategic partnership with European and Global clients.
“In line with our long-term growth prospects and strategy, we invested in hiring and onboarding a record 1,900 plus trainees. This is by leveraging our Global Engineering Academy that is focused on continuous training and upskilling. Despite the robust employee addition, we further improved our Operating margin to 18.6%, reflecting gains from investments in talent and innovation.” Amit said.
Other things to know about L&T Tech
- L&T Tech won a deal worth $45 million from a U.S. based automotive Tier 1 company, to be its strategic engineering partner and provide engineering services for its Electric Vehicle (EV) product portfolio.
- At the end of Q3 FY22, the company’s employee strength stood at 20,118.
- L&T Tech’s patents portfolio stood at 816, out of which 578 are co-authored.
- Confederation of Indian Industry (CII) awarded L&T Tech with the prestigious Top 25 Innovative Company Award at the 2021 Industrial Innovation Awards.
- L&T Tech is the sole member of the software services group in the large cap segment with a market capitalization of Rs 58,000 crore. The company has a P/E ratio of 88.6 against the industry average of 42.21 and a P/B ratio of 16.88 against the industry average of 10.16.
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Research Analyst: Bavadharini KS