maverick
22-11-2007, 05:51 PM
Larsen & Toubro-Riding The Infra Boom
Larsen and Toubro, India’s leading engineering company, has been amongst the star performers on the BSE for most of 2007 as it won new deals in a booming infrastructure market.
The financials have been sold with net profit for the quarter ending Sept. 30, 2007 placed at Rs 3.48 bn. Sales rose 47 per cent from the corresponding quarter last year, to Rs 55.74 bn.
Around 17% of revenues came from overseas operations, while overall, orders grew by 26 per cent in value. The company sees the bulk of its international orders coming from the Middle East, which is experiencing a construction boom of its own on the strength of rising oil prices.
The company’s orders are expected to maintain their momentum over the next six months, growing by 25 to 30%, while revenues will rise by up to 35%. Engineering and construction projects account for around 75% of its total sales.
The company is also launching a $1 billion infrastructure fund, with talks with merchant bankers in final stages. The fund’s first tranche of $300 million is likely to be placed with investors by March 2008.
The Indian government estimates it is going to need close to $500 billion in investment over the next five years to construct roads, ports, airports and power facilities.
Infrastructure companies have been among the strongest performers on the principal Indian indexes this year because of the country’s growth spurt. Analysts claim Larsen and Toubro was assured of a strong order book for the next couple of quarters. It plans three wholly owned arms for power, shipbuilding and railways.
In India, investments in investments in infrastructure, power generation/distribu tion, hydrocarbon production and minerals will sustain growth, while the Middle East is expected to step up investment in oil and gas production and distribution facilities.
Larsen and Toubro, India’s leading engineering company, has been amongst the star performers on the BSE for most of 2007 as it won new deals in a booming infrastructure market.
The financials have been sold with net profit for the quarter ending Sept. 30, 2007 placed at Rs 3.48 bn. Sales rose 47 per cent from the corresponding quarter last year, to Rs 55.74 bn.
Around 17% of revenues came from overseas operations, while overall, orders grew by 26 per cent in value. The company sees the bulk of its international orders coming from the Middle East, which is experiencing a construction boom of its own on the strength of rising oil prices.
The company’s orders are expected to maintain their momentum over the next six months, growing by 25 to 30%, while revenues will rise by up to 35%. Engineering and construction projects account for around 75% of its total sales.
The company is also launching a $1 billion infrastructure fund, with talks with merchant bankers in final stages. The fund’s first tranche of $300 million is likely to be placed with investors by March 2008.
The Indian government estimates it is going to need close to $500 billion in investment over the next five years to construct roads, ports, airports and power facilities.
Infrastructure companies have been among the strongest performers on the principal Indian indexes this year because of the country’s growth spurt. Analysts claim Larsen and Toubro was assured of a strong order book for the next couple of quarters. It plans three wholly owned arms for power, shipbuilding and railways.
In India, investments in investments in infrastructure, power generation/distribu tion, hydrocarbon production and minerals will sustain growth, while the Middle East is expected to step up investment in oil and gas production and distribution facilities.