Larsen & Toubro (L&T), one of India’s largest engineering and infrastructure companies, reported a net profit of ₹3,617 crore for the first quarter of the current financial year. This is almost a 30% increase compared to the ₹2,786 crore it earned in the same quarter last year.
The company’s revenue from operations rose by about 16% to ₹63,679 crore, which shows that its business is growing steadily. Even though its EBITDA (a measure of operating profit) rose by 13% to ₹6,318 crore, its operating margin slipped slightly from 10.2% to 9.9%. This small decline means that while L&T is earning more money, the cost of executing projects is also rising a little.
What makes this quarter stand out is the record order inflow. L&T received new orders worth ₹94,453 crore, which is 33% higher than last year. Over half of these orders came from international markets, showing that the company is expanding its reach beyond India.
At the end of the quarter, L&T’s total order book stood at about ₹6.12 lakh crore. This is the highest ever and gives the company strong visibility for future revenues because it already has projects lined up to execute in the coming quarters.
L&T’s strong results were driven by a combination of three main factors:
1. Strong International Business
Over the last few years, L&T has been increasing its focus on international markets, especially the Middle East, Africa, and other regions with growing infrastructure needs. In this quarter, over 50% of new orders came from outside India, which helped the company offset slow growth in domestic government projects.
Large overseas orders in energy, hydrocarbon, and renewable projects played a key role. This international expansion not only brings more business but also reduces L&T’s dependence on the Indian market, which can be affected by government budget cycles and elections.
A major strength of L&T is its huge order book, which now stands at more than ₹6.1 lakh crore. This means the company has projects lined up for the next few years, ensuring consistent revenue.
During this quarter, the company also executed projects efficiently, which helped it earn more despite some pressure on margins. The mix of infrastructure projects, energy solutions, hi-tech manufacturing, IT services, and real estate ensured that revenue growth was well-distributed across segments.
L&T has also improved its balance sheet. It is managing its debt, working capital, and cash flows better than before. A healthier balance sheet means the company can take up large projects without stressing its finances.
Efficient cash flow management also helps L&T to invest in new technology, bid for larger contracts, and handle project delays without financial pressure.
While the profit numbers are impressive, one area to watch is margins. The company’s operating margin slipped slightly to 9.9%. This happened because:
Some new projects are in their early stages, where costs are higher and profits are lower.
Energy and hi-tech manufacturing segments saw some pressure because of project mix and cost escalations.
International projects often have competitive bidding, which can limit profit margins in the early stages.
The company expects that as these projects progress to later stages, margins may improve because execution becomes more efficient and revenue recognition increases.
The big question is whether this ₹3,617 crore profit is a one-time spike or the beginning of a sustained growth phase.
Several factors suggest that the momentum could continue:
Huge order inflow: A record ₹94,000+ crore in new orders gives L&T visibility for the next few quarters.
Diversified portfolio: L&T is not dependent on a single sector. Its business is spread across infrastructure, energy, technology services, finance, and real estate, which provides stability.
Global expansion: With over half of its revenue now coming from international markets, L&T is less exposed to slowdowns in Indian project awards.
Financial strength: A healthy balance sheet allows L&T to bid for larger and more profitable projects in the future.
However, there are also risks:
Margins under pressure: If project costs rise faster than expected, profits may not grow at the same pace as revenue.
Domestic project slowdown: Indian government projects have been slow, and elections or policy delays could affect future order inflows.
Global uncertainties: Since L&T is taking on more international work, geopolitical tensions, currency fluctuations, or regulatory issues could affect project execution.
L&T’s performance is also linked to the broader economic environment. Several trends are currently favorable:
India’s economy is stable, with services and manufacturing showing growth.
The Reserve Bank of India has recently cut interest rates, which supports infrastructure and construction investments.
Global infrastructure demand is rising, especially in renewable energy, digital infrastructure, and oil & gas projects.
These trends align well with L&T’s capabilities. Its expertise in large-scale engineering, renewable projects, and energy transition projects positions it to benefit from these opportunities.
The stock market responded positively to L&T’s results. The share price rose by around 4% on the day of the announcement, making it one of the top performers on the Nifty 50.
Brokerage firms also reacted:
Some analysts raised their price targets, expecting L&T to benefit from strong international orders.
A few brokerages remained cautious on margins, noting that early-stage projects could keep profitability slightly under pressure in the short term.
In general, the market sentiment is positive, with most investors seeing this performance as the start of a stronger growth cycle for L&T.
L&T’s Q1 profit of ₹3,617 crore is not just a lucky jump. It reflects the company’s strategic shift towards international markets, its record order inflow, and its ability to execute projects efficiently.
While margins are slightly lower, the overall growth in revenue and profit shows that L&T is in a strong growth phase. If it can maintain execution speed, improve margins over time, and keep winning large orders, this quarter could be the start of a longer period of momentum rather than a one-time spike.
The next few quarters will be key in confirming whether L&T can convert its record order book into sustained high profits and defend margins in a competitive global market.