PSL bags Rs 232cr order from NTPC

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PSL bags Rs 232cr order from NTPC

In an interview with CNBC-TV18, Ashok Punj, managing director of PSL, spoke about the company’s latest order win and the road ahead.

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In an interview with CNBC-TV18, Ashok Punj, managing director of PSL , spoke about the company's latest order win and the road ahead.

Below is a verbatim transcript of the interview. Also watch the video.

Q: Let's start with the order that you have got from NTPC today. Can you take us through the details?

A: It's an order for their Solapur power plant and it's an order that took a few months in the finalization, but yes, we have received the formal intimation. It's about Rs 232 crore in value and it will be executed out of our Vizag plant, which is the closest location where we manufacture the pipe. So it's a good order.

Q: What does it take your total order book up to now?

A: We are talking about a global number approximately Rs 2,600 crore of which about Rs 300 crore is international and about Rs 2,300 unexecuted orders in India.

Q: How long would it typically take to execute these orders - just to get a sense of what the annual revenue run rate could be?

A: Most of these barring perhaps the NTPC one which will stretch a little longer but most of the balance orders will be completed within this financial year, March 2012.

Q: So on top of what you achieved in FY11, what kind of revenue are you looking for FY12?

A: As you know forward looking numbers are not encouraged, but we are looking at better year in topline, margins and profitability than we had last year and perhaps even the year before that.

It's been a slow period for the pipe industry but we see very active signs of the industry coming out and breaking out with some rapid growth to which the industry was accustomed until a couple of years ago.

Q: Can you update us on the international operations because there has been a bit of a worry - the fact that your US operations have been lying virtually ideal?

A: I think the US has all of us are worried and certainly PSL, with an investment and installed capacity of 300,000 tonne, is also concerned. There again we see encouraging signs within the shale gas industry of pickup at least within our sector, which is the gas pipeline sector within the US.

We see very active signs of a pickup sooner rather than later. We are hopeful that this will turnaround in the next 60 days or so.

The Middle East of course has been active throughout this period despite setbacks in selective markets in the Middle East. We have been fortunate. We have an order book that will take through the whole year in the Middle East.

Q: What about the Sharjah facility? What amount of order inflow are you seeing from Saudi Arabia because you had recently reported a water pipeline order?

A: Yes, we have a substantial order book out of Sharjah, as I said, for about one year we are booked with the adequate work. We have additional bids outstanding in some Saudi, Kuwait and other countries in the region, which are not affected, none of which are affected by the difficulties in the region in general. We are optimistic that the Sharjah unit will continue to operate at reasonably high capacity levels.