Man Infra mgmt sees Rs 1100cr rev, Rs 135cr PAT in FY11

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Man Infra mgmt sees Rs 1100cr rev, Rs 135cr PAT in FY11

On the sidelines of the listing, its Managing Director Parag K Shah said the order book which currently stood at Rs 2,000 crore was expected to grow over the next two months with further orders of Rs 2,000 crore. He also expected to sustain margins at current levels.

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Excerpts from Bazaar on CNBC-TV18 Watch the full show » RELATED NEWS Man Infraconstruction surges 45% on debut, crosses Rs 350 Man Infra should list above Rs 300/share: Udayan Mukherjee What experts say about Man Infraconstruction listing? Nifty BSE | NSE 31/05/12 Are Mutual Funds betting on Nifty?

Infrastructure construction company Man Infraconstruction has seen a terrific listing surpassing analysts' expectations. It started trade at Rs 335 on the BSE and touched a day's high of Rs 374.90. At 9:11 hours IST, the share was trading at Rs 365.50, a premium of 45% over its issue price of Rs 252 per share.

On the sidelines of the listing, its Managing Director Parag K Shah said the order book which currently stood at Rs 2,000 crore was expected to grow over the next two months with further orders of Rs 2,000 crore. He also expected to sustain margins at current levels. "For FY11, I expect revenue of over Rs 1,100 crore and Rs 135-136 crore profit after tax. FY11 earnings per share is seen at Rs 27.55."

Here is a verbatim transcript of the interview. Also watch the accompanying video.

Q: Terrific listing, you were speaking about Rs 2,000 crore order book. Do you think you will be able to convert from that order book something between Rs 800-900 crore in terms of recognised revenues next year, FY12?

A: We are estimating a turnover of more than Rs 1,100 crore.

Q: If you do Rs 1,100 crore, then should you deliver earnings before interest, taxes, depreciation, and amortization (EBITDA) of something like Rs 250 crore and net profits of something close to Rs 150 crore?

A: We are estimating net profits somewhere around Rs 135-136 crore and EBITDA between Rs 245-255 crore. But we will be able to deliver PAT margin next year around Rs 135-136 crore.

Q: These are much higher than what the market is working with in terms of estimates for FY11. Can I ask you to explain how this much growth is coming in with that Rs 2,000 crore order book?

A: We have a present order book of Rs 2,000 crore and out of that we are estimating around Rs 875-900 crore turnover next year because this Rs 2,000 crore order book is for the tenure of around 24-27 months. Also we have already quoted new tenders worth more than Rs 2,000 crore and we are expecting in next two months time. We are considering around 10-15% turnover from the new orders.

Q: How do you say that you are confident of holding these kinds of margins? Is this also in the context of most of your residential contracts, you are not seeing any slippage over there in margins?

A: We have been strongly saying since last many months to all fund managers also that we do not believe that our margins are much higher. These are the industry margins and we have been able to maintain these since 2002.

Q: What kind of new order intake are you seeing now on this Rs 2,000 crore base for it to move higher where do you primarily see the new order intake coming from to build your order book further?

A: In new orders some of the orders are from the port sector, some from the government sector and few developers jobs, which is almost near finalisation but we will not be able to disclose the name at this moment.

Q: The reason why we are raising the subject because there are some concerns on over concentration on couple of clients for your company so if you had to break-up that Rs 2,000 crore order book how would it spread out between clients?

A: Out of these Rs 2,000 crore orders, most of the orders are from the new clients. So the 40-45% order from one client will come down to almost 25%.