Era Constructions targets 200% topline growth in FY08

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Era Constructions scrip is in focus after the company decided to foray into the housing sector. J L Khushu, Director of Era Constructions, said housing would contribute about 16% of total revenues.

Excerpts from CNBC - TV18's exclusive interview with J L Khushu:

Q: How much will housing contribute as a part of your revenues now that you are foraying into it vis-à-vis the other segments like power infrastructure etc?

A: Housing will be about 16% of the total and we are going to add to this further in the coming year.

Q: What is the order book looking like at the moment and how would it compare with a year ago?

A: As of today, we have orders worth about Rs 1,800 crore. We have received large volume works in infrastructure, railways and highways. From the power sector we will bag orders where we have already tendered or which are going to be tendered shortly. I think the order book is going to go quite high this year.

Q: Over how long is this Rs 1,800 crore going to be executed and what sort of margins will you enjoy in these orders?

A: These Rs 1,800 crore orders will be executed in 15 months. We will add another Rs 5,000 crore this year and the margin will be about 10-14%.

Q: Could you also tell us how much infrastructure and power contribute as a percentage of revenues?

A: Infrastructure is about 37-40% and power will be about 16%.

Q: Could you also throw some light on the housing aspect as to how much land you currently own, what is the value and how much do you propose to acquire going into 2008?

A: That's in the real estate division. It is one of the group companies in the Era Group. We have land at five locations where work is currently going on and 17 locations are to be tackled shortly. I would not be able to comment on the land holding right now because there is a separate division that is dealing with it.

Q: Can you give us an idea of what the total land bank would be?

A: The land bank would be about 400-500 acres.

Q: What would it be approximately valued at?

A: Rs 2,000 crore.

Q: Where are these properties and what are you looking to do with these properties, will it be used more towards residential and commercial retail?

A: This is mixed. It will be residential, commercial, IT parks and group housings and we will have even commercial centers in this.

Q: Could you leave us with 2008 sales and profits targets once all of your divisions are up and running?

A: About 15%.

Q: Growth on the topline.

A: Topline growth would be 200%.