Construction engineering major Larsen & Toubro’s (L&T) managing director and CEO S N Subrahmanyan on Monday said that he does not expect any major private investments in India over the next 1-1.5 years.
“When you look at India, I don’t see any private investments for the next one and a half years or so. It is maybe a tough statement to make, but that is the way I look at it. Existing capital expenditure on projects that are already in play will move on, but I don’t see any fresh capital induction…,” said Subrahmanyan in an interview with CNBC-TV18.
L&T reported a 6 percent drop in consolidated net profit at Rs 3,197.1 crore for the fourth quarter ended March 31. In the corresponding quarter last year, the Mumbai-headquartered company posted a net profit of Rs 3,418 crore. CNBC-TV18 Polls had predicted a profit of Rs 3,250 crore for the quarter under review.
The company announced a final dividend of Rs 8 per share of the face value of Rs 2 each.
Subrahmanyan said that the company has seen normalcy come back to some extent in the last three weeks. “All the factories are back in operation. On the project size, we have at a given time about 950 odd sites and about 90 percent of the sites have started working.”
He, however, said currently the company has only 1,20,000 labourers compared to the 2,20,000 in the pre-COVID period. “To get back to normal working we need about 220 thousand labourers. I guess another 15-30 days labour availability should be there and it should get back to some kind of normality,” he said.
Subrahmanyan said that fear psychosis and herd mentality have led to labour exodus and further the psychological pressure may hold the workers back. “We may have to give some incentives to bring labour back,” he said.
Talking about the impact of COVID-19 on the business, he further added, “Some billing has taken place in April and May but not to that extent, so June – we hope to catch-up something. To overall put it across, let us say we have backlog of 15,000 crore of sales… so in the balance 9-10 months of the year we need to catch that up and see how to make it up.”
