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Last Updated : Mar 20, 2015 10:18 AM IST | Source: CNBC-TV18

New NHAI orders, Rs 1350cr turnover in FY16 radar: Madhucon

KKVN Prasad, Director, Madhucon Projects talks to CNBC-TV18 about the recent project win from NHAI and how the company plans to execute the order. Prasad said the company's ordebook stands at Rs 6400 crore, 50 percent of which comprise road projects.


KKVN Prasad, Director, Madhucon Projects talks to CNBC-TV18 about the recent project win from NHAI and how the company plans to execute the order. Prasad said the company's ordebook stands at Rs 6400 crore, 50 percent of which comprise road projects.

Below is the transcript of KKVN Prasad's interview on CNBC-TV18.

Ekta: Two  or three days ago you announced that you all have won around Rs 397 crore order from the National Highways Authority of India (NHAI)? Can you just give us more details in terms of this order when would you start execution and what sort of margins could we see?

A: We have won this an engineering, procurement and construction (EPC) project from NHAI in the state of Tamil Nadu. This is a concept of about 80 kilometer two lane highway. This project execution will be about 18 months. We have got the letter of invitation (LOI) being the successful bidder in about 2 weeks from now we will enter into a construction contract and then start with its execution.

So in terms of margins this is will be additional margin in our project also because in addition to the typical construction margins we have actually done a build operate transfer (BOT) project in the same region before. We do have an operating infrastructure available at the same highway. So hopefully the margins will be protected and we will be slightly more than the typical construction margins enrolled projects. The company is looking to win further orders from NHAI in the coming months.


Anuj: What is your current order book now and how much of this do you think you will be able to successfully execute in the next financial year?

A: If you look at currently Madhucon Projects order book is about Rs 6,400 crore. This year we are looking at an overall turnover of about Rs 1,250-1,350 crore. If you look at our order book, nearly 50 percent of that is coming from road projects and balance is in the form of building and from the irrigation projects.

Ekta: What is the incremental order flow that we could see say from the NHAI in the coming months?

A: We are biding NHAI project. Currently we are qualified for about 36 projects adding upto Rs 25,000 crore. We are very strategically positioned and strategically looking at winning a decent size of orders from these upcoming bids. We have submitted about 5 so far of that we have this one we are talking about; there is one more we are expecting. Our strategy is to look at an order book of close to Rs 3,500 -4,000 crore this year from NHAI projects alone.

Ekta: Can you just give us an update about the company's plan in terms of divesting stake in the Agra-Jaipur Expressway? That was something that was spoken about a couple of months ago and it was around 74 percent divestment. Where does that stand?

A: It is moving smoothly. As we speak, we are now discussing the closing of this transaction in terms of the share purchase agreement and others. So hopefully sometime soon we will announce the closure.

Ekta: How much and do you expect to rake up and how much of that would possibly go into debt reduction?

A: This particular project debt is about Rs 240 crore. So to that extent the book will be reduced. We have also realised money to the equity which is useful for us to invest elsewhere in the projects

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First Published on Mar 19, 2015 02:47 pm
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