Net sales have increased by 16 per cent to around Rs 1,470.27 crore from around Rs 1,264.31 crore. Other income has increased from around Rs 5.87 crore to Rs 16.81 crore. Total expenditure increased to around Rs 1,306.08 crore (around Rs 1103.93 crore). Interest outgo is pegged at around Rs 35.82 crore from Rs 26.94 crore (Rs 30 crore). According to the company, the incidence of interest and depreciation increased during the quarter because of commissioning of the new cement plants.

Insight

Lower margin in Q2 seen

The first-quarter results for any company in the capital goods industry cannot be taken as an indication of the whole year results, since the performance in the second half is always better. The orders booked during the first quarter are up by 37 per cent from Rs 1,541 crore,and a major chunk of it--the DHDS projects--should be executed in the current year. The operating-profit margin on a quarter to quarter basis is lower by 1.5 percentage points. Tadpatri (2 million tonne) was commissioned in June and the impact will be a lower margin in the second quarter, since the cement division of L&T is an underperformer. The shipping division, too, was a non performer and hardly contributed anything to the bottomline, and the sale of ships will result in a one time gain of Rs 72 crore. For the year, the bottomline is expected to be up by not more than 15 per cent.