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Larsen & Toubro Limited — Q4 FY24
L&T reported a robust Q4 FY24 with group revenues up 15% YoY to INR 67,100 crore and recurring PAT up 8% YoY to INR 4,300 crore.
bullish
high
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L&T reported a robust Q4 FY24 with group revenues up 15% YoY to INR 67,100 crore and recurring PAT up 8% YoY to INR 4,300 crore. Order inflows declined 5% YoY to INR 72,100 crore, but the order book reached a record INR 4.6 trillion (+20% YoY). EBITDA margin contracted 90bps to 10.8% due to higher SG&A costs and mix shift. Management guided for 10% order inflow growth and 15% revenue growth in FY25, with P&M margins around 8.25%. Key drivers include a strong INR 12.1 trillion prospect pipeline, improved working capital (NWC/sales at 12%), and continued CapEx tailwinds in India and GCC. Risks include geopolitical uncertainty in the Middle East, election-related domestic slowdown, and margin pressure from competitive bidding and input cost volatility.
L&T ने वित्त वर्ष 2024 की चौथी तिमाही में अच्छा प्रदर्शन किया। कंपनी की कुल आय पिछले साल की तुलना में 15% बढ़कर 67,100 करोड़ रुपये हो गई। शुद्ध लाभ 8% बढ़कर 4,300 करोड़ रुपये रहा। नए ऑर्डर 5% घटकर 72,100 करोड़ रुपये रहे, लेकिन कुल ऑर्डर बुक 4.6 लाख करोड़ रुपये के रिकॉर्ड स्तर पर पहुंच गया। मुनाफा मार्जिन 10.8% रहा, जो पिछले साल से थोड़ा कम है। कंपनी को अगले वित्त वर्ष में 10% ऑर्डर वृद्धि और 15% आय वृद्धि की उम्मीद है। मुख्य चुनौतियों में मिडिल ईस्ट में अनिश्चितता, चुनावों के कारण घरेलू सुस्ती और बढ़ती प्रतिस्पर्धा शामिल हैं।
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Geopolitical uncertainty in Middle East
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Order Book
INR 4.6 trillion
+20% YoY
Record order book driven by strong inflows in infrastructure and hydrocarbon segments.
Prospect Pipeline
INR 12.1 trillion
+24% YoY
Pipeline growth led by infrastructure (INR 7.25T) and hydrocarbon (INR 3.87T).
NWC to Sales
12%
-410bps YoY
Significant working capital improvement due to aggressive collections and better terms.
International Order Share
27%
-16pp YoY
Lower international share in Q4 due to strong domestic ordering; full-year mix shifted to 38% international.
What Changed vs Last Quarter
NEW
P&M margin around 8.25% in FY25
Projects & Manufacturing margin expected to be similar to FY24's 8.25%, with mix and competitive pressures offset by volume growth.
NEW
NWC to revenue at ~15% in FY25
Working capital intensity expected to increase from 12% to 15% as legacy collections normalize.
UPDATED
Order inflow growth of ~10% in FY25
Management expects 10% growth in group order inflows over FY24's INR 3 trillion, factoring in H1 softness due to elections and a large base.
UPDATED
Revenue growth of ~15% in FY25
Guided for 15% revenue growth driven by record order book and healthy execution momentum.
DROPPED
P&M EBITDA margin band of 8.25%-8.5% for FY24
Trimmed from earlier 8.5%-9% band due to postponement of margin recognition on new jobs into FY25.
DROPPED
NWC to sales ratio around 16.6% (±30bps) for FY24
Revised from 16%-18% band, reflecting sustained working capital discipline.
NEW RISK
Domestic election-related slowdown
H1 FY25 may see softness in tendering and awarding due to general elections and new government formation.
NEW RISK
Margin pressure from competitive bidding and input costs
Analyst raised concern about margin guidance being lowered; management cited mix shift, delayed claims, and higher labor/logistics costs.
NEW RISK
Hyderabad Metro recovery delayed
Free bus scheme for women reduced ridership by 40k; government grants and monetization progress slower than expected.
RISK GONE
Domestic ordering slowdown ahead of elections
Management acknowledged that general elections (Apr-May 2024) could temporarily slow public capex and domestic order inflows.
RISK GONE
Margin recognition delay on new projects
Management indicated that multiple new jobs in ramp-up stage may not cross margin recognition threshold by FY24 end, pushing margin improvement to FY25.
RISK GONE
Execution risk in Middle East fixed-price contracts
Large fixed-price contracts in Middle East require timely execution to realize bid margins; any delays could compress margins.
🤫 Topics management stopped discussing
Mentioned in Q1 FY24, Q3 FY24
Trimmed from earlier 8.5%-9% band due to postponement of margin recognition on new jobs into FY25.
Fast read
Guidance and risk preview
Management expects 10% growth in group order inflows over FY24's INR 3 trillion, factoring in H1 softness due to elections and a large base.
Escalation of West Asia conflict could disrupt supply chains and delay project awards, impacting order inflow guidance.
View Risks →