EPC biz turnover to improve by 15% ahead: Ashoka Buildcon

Paresh Mehta, CFO of Ashoka Buildcon expects the company’s engineering, procurement and construction (EPC) segment to clock 15 percent higher revenue this year versus previous year.

Speaking to CNBC-TV18 about the financial performance of the company, Mehta said, it aims to achieve toll revenue of Rs 300 crore and toll revenue and Rs 100 crore profit this year.

In Q2FY14, Ashoka Buildcon’s turnover and EBITDA stood at Rs 777 crore and Rs 180 crore respectively. Its EPC turnover was at Rs 631 crore over Rs 624 crore.

Also Read: FY14 sales to grow 25%; 5% margin dip seen, says Ashoka Buildcon

Below is the edited transcript of Paresh Mehta’s interview with CNBC-TV18

Q: It has been a bit of a sluggish quarter for you this time, can you just take us through how your segments did and which one possibly was the one which was most pressured?

A: We did a turnover of Rs 777 crore and EBITDA of Rs 180 crore. The engineering, procurement and construction (EPC) turnover stood at Rs 631 crore over Rs 624 crore. So, from an EPC angle, though we were higher, we are slightly lower than the expected turnover due to extended monsoon.

This year monsoon started quite early and it continues in various stretches. We have projects in Orissa and Bengal where monsoon intermittently is interrupting work. Keeping that in perspective and having more five months wait in time; we will catch up with expected revenue on the EPC front.

Secondly, total revenues on the BOT side were Rs 137 crore vis-à-vis Rs 147 crore over last year. The drop is due to one of our projects being terminated last year where revenues were captured in the first half year. Otherwise, due to the slowdown, revenue is not as expected.

We believe that in H2 there will be ramp up of traffic because of good monsoons, good harvesting and effectively good industrial and agricultural production and more traffic will turn into higher toll revenues.

Q: What would the outlook be for second half? What do you think you can deliver as earnings per share (EPS) for full year?

A: We believe that the turnover on the EPC side would be 15 percent higher than the previous year. We will try to do toll revenue of around Rs 300 crore. We will probably make a profit of approximately Rs 100 crore by the year-end and perform slightly better than last year.