Gathering investment momentum post RERA, GST, Demonetisation, says L&T

While posting positive Q1FY19 result, Larsen & Toubro highlighted its outlook going ahead for the company. It mentioned that, domestic market, which witnessed some short term disruptions on implementation of reforms like RERA, GST, Demonetisation, is gathering investment momentum. In Q1FY19,  L&T posted consolidated  Profit After Tax (PAT) for the quarter ended June 30, 2018 at 1,215 crore was higher by 36% vis-a-vis PAT of 893 crore for the corresponding quarter of the previous year. 

Further explaining, L&T said, “Though private sector investment is still muted, Government is focused on development of infrastructure and energy facilities to enable healthy and sustainable economic growth.”

It added, “Rural reforms continue to get priority attention, with larger allocations towards irrigation measures, rural road connectivity and last mile rural electrification. The momentum is expected to continue despite macroeconomic volatility due to oil prices, currency and potential global tariff barrier conflicts.”

Talking about recent surge in crude oil prices, L&T expects to incentivize infrastructure and hydrocarbon capex in the Middle East region. 

“Growth in tax revenues is giving the Government the wherewithal to focus on improving infrastructure,” said L&T. 

For progress on resolution of stressed private sector corporates through the Insolvency Et Bankruptcy Code, L&T expects that it will resolve the issue of overleveraged businesses and kick-start the flow of banking sector credit growth. 

Amidst this backdrop, L&T says, “the Company continues to focus on profitable execution of its large Order Book, continuous improvement of working capital a cost competitiveness.”