NEW DELHI, Jan 28: Larsen & Toubro (L&T), which today reported a 38.85 per cent jump in its consolidated net profit at Rs 972 crore for the December quarter, said the government’s “cashless economy” efforts have caused “disruption” and its impact on business is yet to be assessed.
The industrial giant had clocked a net profit of Rs 700.34 crore for October-December last fiscal.
The infrastructure conglomerate’s total income from operations rose to Rs 26,286.98 crore during the quarter under review, from Rs 25,928.07 crore a year ago.
Its expenses during the quarter were slightly up at Rs 24,486.57 crore as against Rs 24,170 crore in the previous fiscal.
In its outlook, the company said the domestic growth appears to take longer time as investment momentum remains weak and the banking system is burdened by debt overhang.
On recent demonetisation, the infrastructure major said, “Government’s initiatives to curb the parallel economy and make a transition to cashless economy have caused disruption whose impact on the business sentiment is yet to be conclusively assessed.”
It said the challenging business conditions are expected to continue in the next few quarters until the government moves to lift growth through “infra spend and tax reforms take effect”.
About global economic scenario, it said the revival hinges on the outcome of post Brexit events in the UK, change in the economic policy stance in the US, political developments in some of the major European countries and China’s policy response to slowdown.
“Recovery of commodity prices and oil price uptick have provided a positive twist to the global economic revival predictions,” it noted.
The company focus will be on “selective pursuit of opportunities, working capital reduction, cost optimisation through supply chain efficiencies and productivity enhancement through digitisation initiatives”.
“Aided by these initiatives, the company is hopeful of a satisfactory performance, given the current business environment,” it said. (PTI)