See FY12 revenue at Rs 8000cr, FY13 at Rs 12000cr: GMR

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"The tariff determination process for airports' business is underway," said A Subba Rao, Group CFO of GMR Infrastructure . In an interview to CNBC-TV18, Rao said the company's losses have risen primarily because the Delhi airport tariff has not been fixed.

However, he said, once the tariff process is complete and the revised tariffs are allowed to be charged, the company is likely to make profits on a consolidated basis.

"For the whole FY12, we should be closing it with revenue of around Rs 8,000 crore," he further added.

Below is an edited transcript of A Subba Rao's interview to CNBC-TV18. Also watch the accompanying video.

Q: You have got from the airport regulator clearance on the Airport Development Fee (ADF) issue. When will you get final clearance for actually levying the tariff and do you expect FY12 revenues to get impacted?

A: The tariff determination process in underway. We expect this to happen during the course of the current financial year. Depending upon when we would be allowed to collect the tariff for example if we are allowed to collect the tariff from April 1, the revenues will go up accordingly.

Q: So, do you return to profit in the current year by Q4?

A: It's difficult to say. The losses have risen primarily because the Delhi airport tariff has not been fixed. Hence, all the costs have come in but the revenues has not come in completely. Once, the tariff process is complete and we are allowed to collect the revised tariffs, Delhi airport would be moving towards profitability. Hence, on a consolidated basis we will have profitability.

Q: What about the topline? What kind of revenue rate are you looking to achieve in the second half?

A: It should be close to Rs 4,000 crore and overall whole year we should be closing around Rs 8,000 crore.

Q: Where do you see the revenue coming in from? Which divisions do you think will contribute the most?

A: I think all the three sectors will have additional revenues. In the airport sector, the Delhi airport tariff determination will yield us significantly higher revenue. In the road sector, we are going to get the revenue from the new project- the Kishangarh-Ahmedabad project that will add substantially higher revenues and we are also going to commission three more new projects during the course of the next financial year.

Hence, part of the revenues of those projects because they would get commissioned during the mid-course of the financial year, they would get added. In the power sector, we are scheduled to commission new capacities, and all of them will get commissioned during the course of the next financial year. Therefore, all the three sectors will contribute to additional revenues in the next financial year and we will have substantial jump of the revenues.

Q: Should we assume Rs 12,000 crore revenues next year?

A: Based on the current estimates it is definitely on the kind of line of growth.

Q: With respect to the new power projects are you covered on fuel linkages for all of them?

A: We have fuel linkages for both out power plants. We hope to have gas allocation shortly, so with all the three plant we have the fuel allocation and even if there is a shortfall of coal availability in the domestic scenario we have our overseas coal mines, we would be able to bring the coal to run our plant at full capacity in India.

Q: Coal has been a big problem for most power producers recently. What is the update on your Indonesian mines and how do you see the situation panning out in the country?

A: There are two coal mines; we have invested 30% in one of the mines recently and that is generating coal. This year it should have about 6.5 million tonne of production and another coal mine where we have 100% ownership that we have already commenced in the production. Next year we should be closer to a million-million and half tonne of production but would be able to augment the production if we need the coal for Indian operations.

Q: What kind of interest savings are you expecting in the second half, what maybe your interest outgo in the second half?

A: Interest payment should be on the same line as of first half because I don't see any further substantial increase in the interest payments in the second half. No new project is getting commissioned.

Q: What is the situation in the leverage?

A: Gross debt is about Rs 24,000 crore, which we have to remove the cash and we have to remove some pass-through debts like land deposit that we have collected in Delhi airport. If you remove all those things it should be about Rs 18,000-19,000 crore, not more than that which translates into 1:1.5 kind of debt equity.