After bagging a construction order from the Delhi Metro Rail Corporation (DMRC), TD Arora of Era Infra Engineering told CNBC-TV18 that the company's stagnant order book will pick up in this year. He expected additional orders to cross Rs 500-Rs 1,000 crore at the end of 2013.
Speaking on the margin from the project, he saw it to be in-line with its traditional 6.5 percent margin.
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Below is the edited transcript of his interview to CNBC-TV18.
Q: We understand that you have secured an order from the Delhi Metro Rail Corporation (DMRC) for construction of some elevated viaducts.
A: This is a Kochi Metro Rail package but the consultants are the DMRC. We have received the KC-5 metro line package. This is in a joint venture (JV) with Ranken , a Chinese (railway construction) company.
The construction is of elevated viaduct which includes five elevated stations. Some of the stations are there in that Alwaye-Petta Line.
Q: The whole order is Rs 383 crore. But, what do you make in terms of net?
A: While bidding you definitely keep certain margins (aside). While doing the job, certain things are there (kept in mind).
Q: Your traditional margin has been about 6.5 percent. Is that what we should expect in this one?
A: Yes. Such margins are definitely targeted and we will move in that direction. In our past contracts, we have kept our bottom-line intact.
Q: For your company size, this is still relatively smaller order. The concern has been on your stagnant order book. In FY14, will it go past Rs 10,000 crore mark significantly?
A: As far as our order book is concerned we are already having almost around Rs 10,000 crore of work in hand.
Q: But that has been stagnant at Rs 10,000 crore for a year.
A: We have completed some of the projects and received some new jobs in this course. Some more projects are also there in pipeline. This project (Kochi metro rail) is a new area for us.
Since we have already been working with DMRC at various projects, it will strengthen our base in this segment. Our in-hand works are going to increase which is stagnated.
We have picked up. In last two months, we got another project from National Thermal Power Corporation (NTPC).
Q: The fact that you have worked for two years; Rs 10,000 crore will last you for how long?
A: We have been able to do Rs 4,500-Rs 4,600 crore of work annually. Some of the projects have been completed.
Q: Are you L1 in anything? What do you expect in terms of additional incremental orders till the end of 2013; another Rs 500-1,000 crore?
A: Yes, It will be definitely more than that as we are in various stages of bidding.