Views on L&T 3QFY2014 Results - Angel Broking

Views of Mr. Viral Shah (Sr. Research Analyst - Infrastructure, Angel Broking) on L&T 3QFY2014 Results:

Larsen and Toubro 3QFY2014 Result Review (CMP: Rs. 1,005/ Target Price: Under Review/ Recommendation: Under Review)

"For 3QFY2014,excluding the performance of hydrocarbon business Larsen and Toubro (L&T) posted decent set of numbers. During the quarter, the company has demerge and transfer all the assets and liabilities of the hydrocarbon business to its wholly owned subsidiary L&T Hydrocabon Engineering ltd (LTHE) w.e.f December 20, 2013. On the top-line front, the company excluding the performance of hydrocarbon business registered a growth of 11.8% yoy to Rs. 14,388cr in 3QFY2014. The healthy growth in revenues was mainly driven by (a) strong execution in the engineering and construction (E&C) and (b) execution pick up in International orders. On the EBITDA front, company reported a yoy increase of 186bp to 11.6% against our expectations of 10.0%, owing to better-than-expected execution. On the bottom line front, L&T reported a yoy growth of 22.4% to Rs. 1,241cr which was higher than our estimate of Rs. 1,116cr. This was mainly on the back of better-than-expected execution and one time exceptional gain of Rs. 104cr. We believe L&T is best placed to benefit from the gradual recovery in the capex cycle, given its diverse exposure to sectors, strong balance sheet and cash flow generation as compared to its peers. We continue to remain positive on L&T; however we would revise our target price and rating post the earnings conference call."

Note: The figures are of Sales, EBITDA and PAT are excluding hydrocarbon business. Also where there is dsicalimer of excluding hydrocarbon, please mention it.

Source : Equity Bulls

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