Hyderabad-based construction contractor aims to close the fiscal with a total order book of Rs 40,000 crore
Hyderabad: Hyderabad-based NCC is expecting the third and fourth quarters of the fiscal (January-March) to generate substantial top line for the company backed by good order book and the passing of monsoon. The company is seeing growth opportunities as a contractor in metro rail, expressways, affordable housing and building projects (of Rs 1,000 crore and above). It believes FY22 to be even more robust.
Up to November this fiscal, the company has bagged Rs 10,200 crore worth of fresh orders, surpassing the guidance figure of Rs 10,000 crore for FY21, by four months. In November alone, NCC bagged Rs 3,900 crore worth of fresh orders. The company is a L1 in some more orders, and the remaining four months look positive, a senior official said.
NCC EVP-Finance YD Murthy told Telangana Today, “We have begun aggressive execution at all the project sites. With the improved availability of material and manpower, execution will remain faster going forward. The government is also taking several measures to kickstart the economy. The National Infrastructure Pipeline (NIP) aims to have an outlay of Rs 110 lakh crore spread over a period of five years and will open up several opportunities.”
There is a good possibility that the order accretion will continue strong with more orders to come in the following months. “With the current order book at Rs 30,000 crore, the number is likely to go up to Rs 38,000-40,000 crore at the end of the current fiscal,” he added.
The company has projects across the country. The government initiatives are activating many of the public sector undertakings such as the Airports Authority of India (AAI), National Highways Authority of India, All India Institute of Medical Sciences (AIIMS) and defence projects.
“We are currently executing modernisation of Lucknow and Patna airports for AAI. We are developing three medical campuses for AIIMS with each project worth over Rs 1,000 crore. We are also involved in a Navy project worth Rs 1,200 crore in Karnataka, and have become L1 for another package worth Rs 1,400 crore. We are also involved in Nagpur-Mumbai expressway, which is a Rs 2,850 crore package. Land has been acquired for the project in time, and since there is a bonus clause, we are aiming for the bonus by executing the project ahead of the schedule,” he added.
NCC has also got two metro rail packages in Pune, one each in Mumbai and Nagpur. There are several opportunities in the metro rail category.
In Telangana, the company has been involved in Mission Bhagiratha, executing orders worth over Rs 4,000 crore, and all the payments have been received on time. In Andhra Pradesh, the company which has seen State government projects cancelled due to the change in government is seeing things falling in place with central projects picking up. All the affordable housing projects, ADB-funded projects, Atal Mission for Rejuvenation and Urban Transformation (AMRUT) projects have started generating revenues and works have commenced.
Meanwhile, the Finance Ministry has given directions to all the central government agencies to see that the payments are improved, which is speeding up the activity, which is a good thing for the company to meet its working capital needs.
Rakesh Jhunjhunwala, his wife Rekha and group companies have increased their shareholding in NCC to 13.7 per cent early this month from 12.14 per cent at the end of the September quarter 2020. “Jhunjhunwala stayed invested in the company for the last 16 years. That shows his confidence in the company’s performance and the management,” Murthy added.
Several mutual funds are also investing and foreign institutional investors are showing interest in the company. Murthy said the company has a good reputation in the market and with the banks, and things are looking positive for the company.
When asked if the company is looking for external funding to meet its capital needs, he said, NCC is looking at non-fund-based facilities such as the bank guarantees and letter of credits.
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