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LARSEN & TOUBRO LIMITEDLARSEN & TOUBRO LIMITED
Analyst PresentationAnalyst Presentation Q1 FY11Q1 FY11
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Presentation Outline
Q1 FY11 Performance Summary
Se mental Anal sis
ut oo
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Presentation Outline
Q1 FY11 Performance Summary
Se mental Anal sis
ut oo
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Performance Highlights
63%Ro b u st g r o w t h i n Or d e r I n f l ow s dr i v en b y Po w er a n d I n f r a st r u ct u r e
50%Heal t hy Ord e r Book Pos i t i on
6%
Revenues
160bps
EBI TDA Marg in
15%Recur r ing PAT
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Order Inflow & Order Book Q1 FY11
Sectoral Break-up
25% 52% 7% 8% 8%
Order Book:
Order Inflow :
Rs. 156.26 Bn
Infrastructure Power Hydrocarbons Process Others
. .
Infrastructure Roads & Bridges Ports & Harbours
Power Generation Equipments
Hydrocarbons Upstream Mid &
Process Minerals &
Metals
Others Shipbuilding Defense &
Airports Railways Buildings &
Factories
Electrification /Transmission &Distribution
Downstream Pipelines Valves
Bulk MaterialHandling
Fertilizer
Aerospace Construction &
Mining Eqpt. Electrical &
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Water
Technology Services
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Order Inflow & Order Book Q1 FY11
1% 2%
Geographical Break-up Customer Profile
10%
34%
89%
93%
21%
45% 40%
Order Inflow Order Book
Domestic
Middle East
Order I nflow Order Book
Private
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Others
Devl. Projects (L&T)
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Performance Summary - Topline
Rs. Billion Q1 FY11 Q1 FY10%
ChangeFY10
Net Sales 78.35 73.63 6% 366.75
--- . . .
Other Operational Income 0.50 0.45 3.60Total Net Revenues 78.85 74.08 6% 370.35
evenue accrua s are a ong p anne nesSales growth driven by non-E&C segmentGrowth influenced by:
Back-ended Order Inflows in FY10 (in initial stages of execution)
Long-cycle jobs with lengthier contracted execution timelinesIncreased level of International Orders yet to translate intorevenues
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Performance Summary Operational Costs
Rs Bn% to Total Net
RevenuesRs Bn
% to Total Net
Revenues
Particulars
Q1 FY11 Q1 FY10
Manf., Cons. & Opex (MCO) 59.44 75.4% 57.32 77.4%
Staff Costs 5.63 7.1% 5.11 6.9%
, . . . . . .
Total Operational Costs 68.78 87.2% 65.78 88.8%
e uce xpenses o evenues , ne ou come o :Lower subcontracting costsHigher material consumption including effect of commodityprice rise
Operational efficienciesIncrease in staff costs in line with manpower increaseSGA expenses in line with sales.
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Performance Summary Profitability
Rs. Billion Q1 FY11 Q1 FY10
ChangeFY10
EBITDA 10.07 8.30 21% 48.16
EBITDA Margins 12.8% 11.2% 13.0%
Interest Expenses 1.42 1.10 30% 5.05
Depreciation (1.14) (0.94) 22% (4.15)Other Income 2.26 2.25 9.10
Provision for Taxes (3.11) (2.73) (16.21)
PAT before Exceptional Items 6.66 5.78 15% 31.85
Extraordinary & Exceptional Items
(Net of tax)
- 10.20 11.91
Profit after Tax 6.66 15.98 -58% 43.76
Uptick in EBITDA margins driven by E&C businessInterest costs in line with borrowin level
Q1 FY10 exceptional on account of gain on UltraTech stake sale
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Performance Summary Balance Sheet
Increase /s. on un- ar-(Decrease)
Net Worth 190.84 183.12 7.72
Loan Funds 79.30 68.01 11.29
(Net)0.95 0.77 0.18
Total Sources 271.09 251.90 19.19
Net Fixed Asset 66.17 63.66 2.51
. . .
Invt./ICDs/Loans &
Advances to S&A Cos80.95 76.79 4.16
Other Investments 5.50 5.49 0.01
Gross D/E: 42%
. . .
Total Applications 271.09 251.90 19.19
apex u ay: s. . nIncrease in Segmental Net Working Capital as % of Sales from 7.6% to 9%Support to S&A Cos includes:
L&T Power Rs. 1.46 Bn
1010
enera nsurance - s. . nL&T IDPL Rs. 1.18 Bn
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Presentation Outline
Q1 FY11 Performance Summary
Se mental Anal sis
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Segmental Break-up Q1 FY11
Machinery &
Industrial Others
Net Revenues
Engineering
&Construction
83.2%(86.2%)
Electrical &Electronics
ro uc s
6.6%
(5.7%)
.
(1.0%)
.(7.1%)
Machinery &
IndustrialProducts
Others3.1%
EBITDA
Engineering&
Construction79.0%
(80.9%)
Electrical &Electronics
7.2%
10.7%
(10.6%)
.
(7.9%)
12
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Engineering & Construction Segment
Rs. Billion Q1 FY11 Q1 FY10%
ChangeFY10
Total Order Inflows 138.45 83.73 65% 638.99
--- Exports 14.61 4.38 29.31
Total Order Book 1,055.54 699.52 51% 983.86
--- Exports 75.37 96.08 71.28
Total Net Revenues 65.60 63.86 3% 318.42
--- Exports 8.50 13.51 56.26
EBITDA 8.94 7.60 18% 43.39
EBITDA Margins 13.6% 11.9% 13.6%
Net Segment Assets 70.92 68.45 4% 62.91
Ordering Environment turning favourable in domestic marketExport market showing signs of pick-up (mainly GCC)
Longer execution cycles due to increasingly complex long cycle jobsImprovement in EBITDA margins through reduced MCO expensesand favorable job mix
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Electrical & Electronics Segment
Rs. Billion Q1 FY11 Q1 FY10%
ChangeFY10
Total Net Revenues 6.80 5.25 30% 26.94
--- . . .
EBITDA 0.82 0.74 11% 4.23EBITDA Margins 12.0% 14.1% 15.7%
Net Segment Assets 11.09 11.51 -4% 11.32
Favourable Domestic Industrial climate driving higher salesExports affected by project deferments in Middle eastMar ins under ressure due to hi her commodit rices chan e in
product mix and lower price realisationsReduction in Net Segment Assets on account of better workingcapital management
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Machinery & Industrial Products Segment
Rs. Billion Q1 FY11 Q1 FY10%
ChangeFY10
Total Net Revenues 5.23 4.20 25% 21.35
--- . . .
EBITDA 1.20 0.99 21% 4.71EBITDA Margins 23.0% 23.7% 22.1%
Net Segment Assets 1.76 2.94 -40% 2.24
Revenue increase anchored by allround industrial recovery barringvalves business. Good Recovery in Construction and Mining businessEx ort Order Inflow ickin u in Valves and rubber rocessin
businesses; translation to revenues in subsequent quartersMargins holding firm despite cost pressuresReduction in Segment assets achieved through lower Net Working
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Others Segment
Rs. Billion Q1 FY11 Q1 FY10%
ChangeFY10
Total Net Revenues 1.22 0.77 58% 3.65
---Ex orts 1.12 0.71 3.26
EBITDA 0.35 0.06 487% 0.52
EBITDA Margins 28.9% 7.8% 14.2%
Net Segment Assets 2.03 2.15 -6% 2.03
Mainly represented by Engineering ServicesSales growth led by favourable market conditions in USA andEuropeSmart improvement in margins due to better manpower utilisationand im roved rice realisation
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Presentation Outline
Outlook
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Performance of Key Subsidiaries
Q1 FY11 Q1 FY10%
ChangeQ1 FY11 Q1 FY10
%
ChangeQ1 FY11 Q1 FY10
PAT MarginsTotal Income PAT
Rs. Billion
L&T Finance 2.87 1.98 45% 0.58 0.24 145% 20.3% 12.0%
L&T Infrastructure Finance 1.48 0.86 71% 0.48 0.22 118% 32.2% 25.3%
L&T InfotechRevenue and PAT growth indicative of IT sector recovery
nanceGrowth driven by allround recoverySmart Increase in NIMBusiness Assets Rs. 80 Bn (PY: Rs. 50 Bn)
L&T Infra FinanceGrowth driven by strong domestic demand for Infrastructure fundingHealthy improvement in NIM
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us ness sse s s. n : s. n
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Developmental Projects
Roads and Br i dges: Portfolio: 15 projects; 7 operational, 8 under implementationDevelopment: 5646 lane km
.
Por ts : Portfolio: 3 projects; 1 operational, 2 under implementation
Ur b a n I n f r a st r u c t u r e : Portfolio: 19 projects; 6 operational, 13 under implementation
Project Outlay: Rs. 53 Bn
Area: 28 Mn sq. ft.Project Outlay: Rs. 89 Bn
P o w e r :
Portfolio: 3 projects under implementationCapacity: 1479 MWProject Outlay: Rs. 110 Bn
19Total Equity Invested (June 2010): Rs. 33.5 Bn
Total Project Cost (June 2010): Rs. 384 Bn
Total Equity Commitment (June 2010): Rs. 74.8 Bn
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Presentation Outline
Q1 FY11 Performance Summary
Se mental Anal sis
ut oo
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Outlook
Government
Strong Balance
Capacity &
Ca abilit build u
Susta inab le G r o w t h
Metrics
Business Model
Stable Domestic
Economic & Fiscal-
Growth DriversEnvironment;volatile global
situation
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Annexure 1: Details of Other Income
Rs. Billion Q1 FY11 Q1 FY10
Interest Income 0.65 0.30
. .
Income from Other Investments 0.56 0.64Profit on sale of investments 0.01 0.82
Miscellaneous Income 0.54 0.38
Total - Other Income 2.26 2.25
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