L&T Tech Q1 profit falls 9% on weak margins

Mumbai: L&T Technology Services, a subsidiary of Larsen & Toubro, reported a 9 percent fall in net profit in the quarter ended June compared with the year-ago period, hurt by lower margins on account of rupee appreciation.

L&T Technology, the engineering services company, posted a net profit of Rs. 98 crore, down from Rs 108 crore in the same period last year. Revenue inched up 2 percent to Rs. 822.6 crore.

The company said operating margin for the quarter stood at 15.3 percent, down from 18.1 percent last year.

"Manufacturing and oil& gas sectors have hit the bottom. There are now signs of revival in these sectors. Energy storage and automotive sectors are going to get big," Keshab Panda, CEO & Managing Director, L&T Technology. "Customers are increasing their engineering technology spend."

The company said the quarter was buoyed by several multi-year multi-million dollar deals from global customers in new age areas like robotics, video solutions, avionics and autonomous car technologies.

Panda said he maintains his target of double digital revenue growth on constant currency in dollar for the current financial year encouraged by their "healthy" deal pipeline.

L&T Technology is on a lookout for more acquisitions to add to their capability. Last quarter the company bought US-based Esencia Technologies to add competency and technology in perceptual computing, Internet of Things, advanced silicon products and wireless networking technologies.