Gayatri Projects expects growth rate of 18-20% : MD

Below is the edited transcript of his interview to CNBC-TV18.

Q: Can you provide details with regards to cost of capital?

A: Our total FCCB outstanding was above Rs 210 crore. In last March, we bought back Rs 25 crore. We paid Rs 40 crore in August and today we have paid the balance Rs 146 crore. Out of the total Rs 215 crore, we have raised a long-term ECB of around Rs 125 crore and the balance from internal accruals.

Q: How much your annual cost goes up in terms of interest rate? Have you hedged your foreign exchange exposure?

A: We have hedged our capex exposure and the annual cost will increase because of the interest exposure by total of Rs 120 crore. Our annual interest will increase by Rs 10 crore due to this exposure.

Q: Are you planning to cash in by selling in your BOT projects?

A: No. EPC is our main line of business where we have an order book of Rs 9,500 crore which will keep our order book full for next three years. In our BOT portfolio, we have four annuity projects which are commissioned and we are receiving annuities on time. Along with this we have also commissioned two toll projects. 

Q: What was the annual revenue from your annuity projects and will your number of annuity projects go up in the current or next year?

A: All the four annuity projects are already completed and together it will be around Rs 200 crore per annum. We own 50 percent share in all the projects. So we expect revenue of Rs 100 crore reflecting in our books. Our Western UP Tollway project, which is in joint venture with Nagarjuna, is fully commissioned and has started collecting toll. We are also collecting toll for Indore-Devas six-lane project, where the work is expected to be completed by FY2014.  Hyderabad-Karimnagar road project, a four-lane project is right now under construction.

Q: How have the orders been in the September quarter and how does your outlook look?

A: We have not picked up any order in the September-October quarter. Our target is to get order of Rs 500 crore before March end.

Q: So, the pipeline is not looking very healthy, some of the bigger peers like Larsen and Toubro is into E&C, they have managed to do a lot on the building?

A: We have three lines of business namely, irrigation, roads and industrial projects where we are fully busy with our projects. Our order book of Rs 9,500 crore is enough to take care of 18-20 percent growth rate for next two and half years. We are not in a hurry, and aggressive to bid for projects just for the sake of order book. We prefer better bottom line than better prices. The bidding process in road projects has been very aggressive, so we want to go slow on road projects now.

Q: How much is your foreign exchange exposure?

A: Our exposure is Rs 125 crore, approximately USD 24 million.

Q: What is the total amount that you were hit in the last quarter due to forex fluctuations?

A: Overall, we were hit by around Rs 100 crore due to forex fluctuations.

Q: What is the denomination of current loan and the length of the loan?

A: The loan is denominated in dollar and the length is seven years.

Q: Would your revenue run rate be around Rs 400 crore for the coming quarters as well or would you do better?

A: I cannot comment on revenue run rate and it is difficult to comment on quarterly basis but we expect 20% growth for the whole year over last year.