Share Price of L&T Climbs 5% Following Strong Q3 Earnings and Order Book Expansion

L&T Stock Performance Overview

Shares of construction major Larsen & Toubro (L&T) surged nearly 5% on January 31 following the company's Q3FY25 earnings report, showcasing a rise in net profit and revenue and solid gains in its order book.

L&T shares traded at ₹3,552 on the NSE at 09:16 AM, reflecting strong investor sentiment.

L&T Q3 Earnings Breakdown

Revenue and Net Profit Performance

Revenue surged 17% to ₹64,668 crore, up from ₹55,128 crore in Q3FY24. However, both revenue and net profit missed estimates

L&T reported a 14% increase in net profit, amounting to ₹3,359 crore in Q3FY25, compared to ₹2,947 crore in the same period last year.

Operational Performance and Margins

Rising raw material and construction costs weighed on L&T's operational performance despite revenue growth. This resulted in a 70 basis point decline in EBITDA margin, which stood at 9.7% in Q3 FY25.

Key Challenges Faced

• High costs of raw materials and components
• Increased expenses in the construction segment

L&T's Order Book & Growth Outlook

Strong Order Inflows

L&T recorded a 53% YoY growth in order inflows, securing orders worth ₹1,16,036 crore in Q3FY25, compared to ₹75,990 crore in the same quarter last year.

Segment-Wise Orders

L&T secured projects across various sectors, including:

• Thermal power & renewables
• Power transmission
• Precision engineering
• Minerals & metals
• Commercial buildings & hydrocarbon onshore

At the end of December 2024, L&T's consolidated order book stood at ₹5,64,223 crore, with 42% coming from international projects.

Future Outlook & Market Sentiment

L&T's management remains optimistic about its growth trajectory, expecting:

• Order inflow growth to exceed 10% in FY25
• Execution growth to surpass 15%
• Operating profit margin to remain stable at ~8.2%

Summary

Despite higher raw material costs and margin pressure challenges, L&T's Q3FY25 results reflect substantial revenue and order inflow growth. With a robust pipeline of orders and positive management guidance, the stock remains a strong investment pick for long-term growth.

Investors and market analysts will closely monitor L&T's upcoming quarters to assess its ability to sustain order inflows and improve profitability.