Larsen & Toubro Limited · NSE:LT
Larsen & Toubro — Q4 FY2020 Earnings Presentation
47 slides from Larsen & Toubro's earnings presentation, Jun 17, 2020
Slide 1: Cover letter to stock exchanges
Larsen & Larsen & Toubro Toubro Limited Limited Q LARSEN & TOUBRO Secretarial Department Secretarial L&T House, LEtT Narottam Mumbai -- 400 Mumbai Tel: +91 Tel: Department House, Ballard Ballard Estate Narottam Morarjee 400 001, +91 22 22 6752 Estate Morarjee Marg Marg 001, INDIA INDIA 6752 5656 565
Slide 2: Investor Presentation Q4/FY20
LARSEN & TOUBRO Investor Presentation Q4/FY20 June 5, 2020 1 Sensitivity : This Document is Classified as "LNT Internal Use". 1
Slide 3: Disclaimer
Disclaimer This presentation contains certain forward retain highly skilled professionals, time and cost looking statements concerning L&T’s future over runs on contracts, our ability to manage our business prospects and business profitability, international operations, government policies which are
Slide 4: L&T Overview
L&T Overview Engineering Manufacturing Construction Projects Technology Financial Financial Services Services 3 Sensitivity : This Document is Classified as "LNT Internal Use".
Slide 5: L&T – At a Glance
L&T – At a Glance India’s largest E&C company with interests in Projects, Infrastructure Development, Manufacturing, IT & Financial Services. Revenues Credit Ratings Market Cap Professionally ₹1,455Bn CRISIL: AAA / Stable ₹ 1,341Bn Managed Company ICRA: AAA (Stable) FY 20 Group 5th Jun, 2020 (approx
Slide 6: L&T – At a Glance
L&T – At a Glance Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This Document is Classified as "LNT Internal Use".
Slide 7: L&T – Shareholding Pattern
L&T – Shareholding Pattern Bharat ETF, Others, 0.6% 7% Govt. Financial Mutual Institutions Funds & Pvt. & Insurance Insurance Companies, Cos., 21% 18% 30th Sep, Major Institutional Shareholders % Shares 2019 Life Insurance Corporation of India 14.9% L&T Employees FII's & GDR, HDFC Mutual Fund 4.6% T
Slide 8: Experienced Management Team
Experienced Management Team 1 2 3 4 5 6 7 8 A M Naik S. N. R Shankar Shailendra Roy D. K. Sen M. V. Satish J.D. Patil Subramanian Group Subrahmanyan Raman Whole-time Director Whole-time Whole-time Director Whole-time Sarma Chairman Chief Executive Whole-time & Sr. Executive Vice Director & Sr. & Sr.
Slide 9: Corporate Governance
Corporate Governance L&T’s essential character revolves around values based on transparency, integrity, professionalism and accountability. Board of Directors Four-tier Governance Executive Committee Structure (ECom) Independent Company (IC) Board Strategic Business Group (SBG) / Business Unit (BU)
Slide 10: Sustainability & Integrated Report
Sustainability & Integrated Report <IR> 2018-19 available on www.Larsentoubro.com In alignment with Based on International Global Reporting Integrated Reporting Initiative (GRI) Council (IIRC) framework Standards ‘In Accordance – Comprehensive Reports progress on option’ – highest Sustainable Develo
Slide 11: Sustainability – Environment & Social
Sustainability – Environment & Social Green Product Portfolio – INR 317. 65 Billion CSR Highlights – 2.3 million beneficiaries • Theme: Building India’s Social Infrastructure • 24 campuses have achieved the ‘zero water discharge’ status • Integrated Community Development Program • Secured 500+ MV Gr
Slide 12: Business Overview
Business Overview Engineering Manufacturing Engineering Manufacturing Construction Projects Projects Technology Technology Financial FinancialServices Services 11 Sensitivity : This Document is Classified as "LNT Internal Use".
Slide 13: Builders to the Nation
Builders to the Nation Statue of Unity, Gujarat Turbine Rotor, Gujarat 88m Rail Bridge Jammu Udhampur Wankhede Stadium, Mumbai Baha’i Temple, Delhi Mumbai International Airport Medigadda Barrage, Telangana Vivekanand Bridge, Kolkata Kakrapar Nuclear Power Plant, Guj Vizag Steel Plant Sri Sathya Sai
Slide 14: International Footprint – Marquee Jobs
International Footprint – Marquee Jobs Stadium at Barbados Salalah Airport, Oman Twin Towers, Dubai Marina NMC Speciality hospital, Abu Dhabi Bhukara Hotel, Uzbeckistan World’s Longest Conveyer, Bangladesh Bulk Cement Terminal, Colombo Fabrication Facility, Oman Punatsangchhu HEP, Bhutan Sheikh Khal
Slide 15: Value creating Integrated Business Model
Value creating Integrated Business Model Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This Document is Classified as "LNT Internal Use".
Slide 16: E&C Delivery Platform
E&C Delivery Platform One of Asia’s largest vertically integrated E&C Companies Design & Engineering EPC PROJECTS Construction Manufacture & Fabrication Single point responsibility for turnkey solutions Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This
Slide 17: Quality Customer Mix
Quality Customer Mix Indian Coastguard Engineering Manufacturing Construction Projects Technology Financial Services Engineering Engineering Manufacturing Manufacturing Construction Construction Projects Projects Technology Technology Financial Financial Services Services Sensitivity : This Document
Slide 18: Multiple Alliances & Joint Ventures
Multiple Alliances & Joint Ventures Alliances Pre Qualifications Joint Ventures Befula Investments Note: Some of these are project specific alliances & pre qualifications Engineering Manufacturing Engineering Manufacturing Construction Construction Projects Projects Technology Technology Financial S
Slide 19: L&T's Business Structure
L&T’s Business Structure LARSEN & TOUBRO LTD. Business verticals Subsidiaries, JVs & Associates Buildings & Factories L&T Hydrocarbon Engineering Transportation Infrastructure Financial Services Heavy Civil Infrastructure IT & Technology Services Water & Effluent Treatment Infrastructure SPVs (BOTs)
Slide 20: Group Performance
Group Performance Engineering Manufacturing Construction Projects Technology Technology Financial Services Financial Services Sensitivity : This Document is Classified as "LNT Internal Use". 19
Slide 21: Performance Highlights – FY20
Performance Highlights – FY20 Order Inflow +9% PAT Order Book +7% +4% EBITDA Revenue +7% +8% Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This Document is Classified as "LNT Internal Use". 20
Slide 22: Key Financial Indicators
Key Financial Indicators (Amount in ₹ bn) Q4 FY19 Q4 FY20 % Var Particulars FY19 FY20 % Var 551 578 5% Order Inflow 1708 1864 9% Order Book 2908 3039 4% 433 442 2% Revenue 1352 1455 8% 53 51 (3%) EBITDA 153 163 7% 34 32 (6%) PAT 89 95 7% Net Working Capital 18.1% 23.7% RONW (TTM) (%) 15.3% 14.8% - E
Slide 23: Q4/FY20 Order Inflow/Order Book
Q4/FY20 Order Inflow/Order Book (Amount in ₹ bn) Order Inflow Order Book 5% 9% 4% Q4 FY19 Q4 FY20 FY20 617 750 413 165 578 1263 601 1864 2908 3039 FY19 1257 451 1708 2291 2289 378 173 551 FY19 FY20 Domestic International • Strong Domestic order inflows witnessed in Q4 • International order wins cont
Slide 24: Group Performance – Sales & Costs
Group Performance – Sales & Costs • Pandemic adversely affects Q4 revenues. IT&TS smoothly Q4 Q4 transitions to WFH model % Var Rs Billion FY19 FY20 % Var FY19 FY20 • MCO expense variation largely due 433.0 442.5 2% Revenue 1352.2 1454.5 8% to higher proportion of IT&TS 30% 32% International Rev. 32
Slide 25: Group Performance – Profit Stack
Group Performance – Profit Stack Q4 Q4 % Var Rs Billion FY19 FY20 % Var FY19 FY20 • Finance cost commensurate with higher debt levels and phased 52.8 51.2 -3% EBITDA 153.3 163.3 7% commencement of Hyd. Metro (5.1) (8.2) 62% Fin. Cost (18.0) (28.0) 55% • Higher depreciation charge on account of Mindt
Slide 26: Segment Performance Analysis
Segment Performance Analysis Engineering Manufacturing Engineering Manufacturing Construction Construction Projects Projects Technology Technology Financial Financial Services Services Sensitivity : This Document is Classified as "LNT Internal Use".
Slide 27: Segment Composition
Segment Composition Heavy Defence Hydrocarbon Infrastructure Power Engineering Engineering Buildings & Factories (B&F) EPC- Coal & Gas Process Plant Equipment Defence Onshore Transportation Infra (TI) Thermal Power Plant Nuclear Power Plant Aerospace Offshore Heavy Civil infra (HC) Construction Equi
Slide 28: FY20 Order Inflow Composition
FY20 Order Inflow Composition Others ROW 3% USA & Europe 7% 11% Services 22% Infrastructure 55% Middle East 14% Hydrocarbon 11% Defence Engineering Domestic 1% 68% HE 1% Power 7% Order Inflow Rs 1864 Bn Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This
Slide 29: FY20 Order Book Composition
FY20 Order Book Composition Hydrocarbon ROW Others USA & 15% 10% 2% Europe 1% Defence Engineering 3% Middle HE East 1% 14% Power 5% Domestic Infrastructure 75% 74% Order Book Rs 3039 Bn Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This Document is Class
Slide 30: FY20 Revenue Composition
FY20 Revenue Composition ROW Others USA & Europe 6% 3% 13% Infrastructure Services 50% 28% Middle East 14% Hydrocarbon 12% Domestic Defence 67% Engineering HE Power 3% 2% 2% Revenue Rs 1455 Bn Engineering Manufacturing Construction Projects Technology Financial Services Sensitivity : This Document i
Slide 31: Infrastructure Segment
Infrastructure Segment (Amount in ₹ bn) Net Revenue -6% Net Revenue 1% 268.5 253.3 62.9 61.6 205.6 191.7 FY19 FY20 Q4 FY19 Q4 FY20 12.3% EBITDA Margin 11.1% 8.5% EBITDA Margin 8.1% Domestic International • Strong domestic and international order inflows in Q4 – contributed by order wins in Solar and
Slide 32: Power Segment
Power Segment (Amount in ₹ bn) Net Revenue -40% Net Revenue -42% 9.3 2.5 5.6 0.4 6.8 5.2 FY19 FY20 Q4 FY19 Q4 FY20 4.7% EBITDA Margin 38.3% 4.5% EBITDA Margin 12.0% Domestic International • Strong order inflows in current year replenishes order book • Revenue decline reflects depleted opening order
Slide 33: Heavy Engineering Segment
Heavy Engineering Segment (Amount in ₹ bn) Net Revenue -17% Net Revenue 31% 7.7 6.4 4.1 3.6 3.6 2.8 FY19 FY20 Q4 FY19 Q4 FY20 22.8% EBITDA Margin 18.5% 24.5% EBITDA Margin 21.5% Domestic International • Order Inflows in current year impacted by deferments • Strong revenues for the year driven by lar
Slide 34: Defence Engineering Segment
Defence Engineering Segment (Amount in ₹ bn) Net Revenue -15% Net Revenue 6% 10.9 1.1 9.3 1.2 9.8 8.1 Q4 FY19 Q4 FY20 FY19 FY20 18.6% EBITDA Margin 17.5% 16.2% EBITDA Margin 18.2% Domestic International • Policy bottlenecks, fiscal constraints and lengthy MoD procurement procedures continue to beset
Slide 35: Hydrocarbon Segment
Hydrocarbon Segment (Amount in ₹ bn) Net Revenue 15% Net Revenue 15% 49.7 43.2 16.5 22.3 33.2 20.9 FY19 FY20 Q4 FY19 Q4 FY20 9.8% EBITDA Margin 11.0% 8.8% EBITDA Margin 10.9% Domestic International • Slowdown in order inflows due to global volatility in oil prices • Strong revenue growth on the back
Slide 36: Developmental Projects Segment
Developmental Projects Segment (Amount in ₹ bn) Net Revenue -9% Net Revenue -4% 10.8 1.0 9.8 3.2 9.8 6.6 FY19 FY20 Q4 FY19 Q4 FY20 -3.6% EBITDA Margin 6.1% 10.3% EBITDA Margin 11.1% Nabha Hyd. Metro Kattupalli Port • Segment includes Power Development business, Hyderabad Metro; IDPL (Roads & TL) con
Slide 37: IT & Technology Services Segment
IT & Technology Services Segment (Amount in ₹ bn) Net Revenue 68% Net Revenue 54% 63.5 20.3 37.7 14.1 13.4 24.3 29.1 FY19 FY20 Q4 FY19 Q4 FY20 21.9% EBITDA Margin 20.8% 23.2% EBITDA Margin 20.9% IT TS Mindtree • Mindtree results consolidated from Q2 FY20 post-acquisition on 2-Jul-2019 • LTI revenue
Slide 38: Others Segment
Others Segment (Amount in ₹ bn) Net Revenue -13% Net Revenue -11% 13.1 2.1 11.3 1.8 11.0 9.5 FY19 FY20 Q4 FY19 Q4 FY20 13.9% EBITDA Margin 15.6% 28.6% EBITDA Margin 20.9% Domestic International • Segment comprises Construction & Mining Equipment, Rubber processing Machinery, Industrial Valves and Re
Slide 39: L&T Finance Holdings Group
L&T Finance Holdings Group Q4 FY19 Q4 FY20 % Var Rs Bn FY19 FY20 % Var 31.8 33.7 6% Income from Operations 126.4 138.2 9% 3.2 2.4 -24% PAT (Net of NCI) 14.5 10.8 -25% Mutual Fund Average AUM 709.4 710.6 0% Net Loan Book 991.2 983.8 -1% Gross Stage 3 Assets 5.9% 5.4% Net Stage 3 Assets 2.4% 2.3% Netw
Slide 40: Electrical & Automation Segment
Electrical & Automation Segment (Amount in ₹ bn) Net Revenue -31% Net Revenue -10% 16.3 4.4 11.2 2.5 11.9 8.7 FY19 FY20 Q4 FY19 Q4 FY20 21.0% EBITDA Margin 16.9% 17.6% EBITDA Margin 17.9% Domestic International • Muted revenues resulting from a soft demand environment • Q4 revenues and margins adver
Slide 41: The Environment & Outlook
04 The Environment & Outlook 40 Engineering Sensitivity : This Document is Classified as "LNT Internal Use". Manufacturing Construction Projects Technology Financial Services
Slide 42: The Environment & the Outlook
The Environment & the Outlook Tapering economic growth / Covid impact Muted Public & Private Order Sector Investments Book Balance Global Growth Sheet Outlook slowdown Business Economic and Portfolio Liquidity Stimulus Capability Spectrum Engineering Manufacturing Construction Projects Technology Fi
Slide 43: Thank You
Thank You Sensitivity : This Document is Classified as "LNT Internal Use". Turn overleaf for Annexures
Slide 44: Segment Margin
Segment Margin FY20 FY19 Segment (Rs Cr) Net EBITDA Net EBITDA EBITDA EBITDA Revenue % Revenue % Ex-Services business: Infrastructure Segment 73037 5912 8.1% 72418 6153 8.5% Power Segment 2294 274 12.0% 3972 177 4.5% Hydrocarbon Segment 17420 1898 10.9% 15132 1330 8.8% Heavy Engineering Segment 2853
Slide 45: Balance Sheet
Balance Sheet Incr / Rs Billion Mar-20 Mar-19 (Decr) Equity & Reserves 667 624 43 Non Controlling Interest 95 68 27 Borrowings - Financial Services 939 915 23 Development Projects 202 191 11 Others 269 149 120 Sources of Funds 2,173 1,948 225 Fixed Assets 156 134 22 Intangible Assets & Investment Pr
Slide 46: Cash Flow
Cash Flow Q4 FY19 Q4 FY20 Rs Bn FY19 FY20 57.8 56.6 Operating Profit 160.7 185.2 16.9 13.4 Changes in Working Capital (21.0) (83.6) (13.3) (9.4) Direct Taxes paid (48.8) (40.5) 61.4 60.6 Net Cash from Operations (A) 90.9 61.2 (10.9) (13.9) Net Investment in Fixed Assets (incl. Intangible) (35.0) (33
Slide 47: Share in Profit/(Loss) of JVs/Associates
Share in Profit/(Loss) of JVs/Associates Q4 FY19 Q4 FY20 Rs Bn FY19 FY20 0.55 0.51 MHPS JVs 1.68 1.86 (1.98) 1.13 IDPL & Subs. (0.90) (0.05) (0.32) (0.34) Special Steels and Heavy Forgings (1.40) (1.37) 0.48 0.17 Others 0.41 0.28 (1.27) 1.47 Total (0.21) 0.72 Engineering Manufacturing Construction P