L&T is not going to sell its electrical and automation business.
Mr A.M. Naik, Chairman and Managing Director, said all the talk of sale was speculation and handiwork of vested interests and it would be a subsidiary as envisaged by the on-going restructuring programme of L&T. “We are not going to sell,” he said.
Last month, L&T had sought shareholders' approval to transfer the business to a subsidiary/associate company or to any other entity.
An analyst said offloading such businesses was difficult as it was still a buyers' market and most large players would not be interested.
Results
Tiding over rising inflation concerns, slow decision making of the Government and political uncertainties relating to the economy, Larsen & Toubro reported a 17 per cent rise in net profit and a healthy growth in order inflow of 27 per cent at Rs 30,313 crore for the quarter ended March 2011 (Rs 23,843 crore). The last quarter's order inflow helped the company log an order book of Rs 1,30,217 crore, as of March 31, 2011.
The board of directors has recommended a dividend of Rs 14.50/share.
The consolidated group's total income for the year at Rs 52,089 crore grew 18 per cent. For FY11, PAT at Rs 4,456 crore was down 10 per cent from Rs 5,451 crore primarily due to exceptional income of over Rs 1,600 crore logged last year due to the company exiting Ultratech Cement and the Bangalore Airport. Mr Naik said that despite the concerns, the company was able to notch up 15 per cent rise in order inflow for the year at Rs 79,769 crore (Rs 69,572 crore).
Outlook
Stating that fiscal deficit, rising inflation and interest rates were issues to contend with, he saw good prospects for the infrastructure, hydrocarbons and power segments this fiscal. He cautioned that margins would be under pressure and the impact could be 0.5 to one per cent in the coming quarters.
On Thursday, L&T scrip closed 6 per cent higher at Rs 1,595 on the BSE.
Mr Y.M. Deosthalee, Chief Financial Officer, said a revised prospectus for L&T Finance had been filed with SEBI and he expected it to be cleared shortly. It would be ready to hit the capital market at short notice and would look for reasonable market stability to take the call.