Larsen & Toubro profits rise

Indian contractor Larsen & Toubro (L&T) reported a +12% year-on-year increase in net second quarter profit to INR 746 crore (US$ 166 million), boosted by growth in its engineering and construction division.

Group revenues grew +21% to INR 9578 crore (US$ 2.2 billion) in the second quarter compared to the same three months in 2010, while engineering and construction revenues grew +23% year-on-year to INR 8018 crore (US$ 1.8 billion).

However, L&T warned that the slowing Indian economy coupled with inflationary pressures could drag on results.

"Global economic concerns, spiralling inflation and hardening interest rates are likely to impact the growth prospects in the Indian economy," the company said, adding that the country's economy had withstood such cycles in the past and emerged resilient.

"Speedy implementation of various initiatives by the government for industrial and infrastructure development holds the key to an accelerated growth momentum," L&T said.

In terms of global opportunities, the company said Middle Eastern markets represented opportunities in the areas of hydrocarbons, power transmission and distribution, as well as infrastructure development.

L&T's order book stood at INR 136172 crore (US$ 30.3 billion) at 30 June.