Anoop Kumar Mittal, Chariman and Managing Director Of NBCC says the demonetisation has not affected the company. Although, he adds that there was some inventory of constructed office complexes that have gone unsold.
NBCC's orderbook currently stands at Rs 76,000 crore, says Anoop Kumar Mittal, Chariman and Managing Director of NBCC. He says of these projects in the orderbook, the company will make a turnover of around Rs 10,000 crore in the current year.
He says the demonetisation has not affected the company. Although, he adds that there was some inventory of constructed office complexes that have gone unsold. But he still feels the realty market will pick up very soon and land prices may shoot up.
He also expects the company's margins to increase going ahead.
Below is the verbatim transcript of Anoop Kumar Mittal’s interview to Anuj Singhal, Latha Venkatesh & Sonia Shenoy on CNBC-TV18.
Anuj: First your thoughts on what actually happened between yourself and the Air India deal, because that deal was hit by valuations, where are we right now?
A: It is not true that deal has been hit by valuation. There are three-four models in our agreement with Air India and as per that valuation has to be determined by both the organistaions. Because of sluggishness in the real estate market, we couldn’t arrive to a consensus decision. However, still we are working on two land parcels one is in Chennai and other is in Kolkata. Hopefully, in a month or so we will finalise that project.
Anuj: That deal is not totally off but you believe that deal should now be re-negotiated because of the recent sentiment in real estate?
A: First of all there is no question of re- negotiation of this deal because there are already provisions in that. Deal is still on and they have to get all the land parcels developed or sold. So, NBCC will do definitely and definitely this real estate market now I feel that it will give some boost and the land prices will also particularly government land prices will also go up.
Sonia: Can you tell us exactly what is the size of the deal and what kind of arrangement would you have in terms of profit sharing?
A: There are two-three models. One is we will develop land on their behalf like we are developing in Delhi. We will charge the project management consultancy (PMC) charges and marketing charges 10 percent and 1 percent – that is one. Some equity NBCC will put in that project and for that NBCC will get some interest.
There is another model in the agreement where NBCC will put equity and profit will be shared equal in to equity. NBCC’s equity of construction and their equity in shape of land., so profit will be shared like that. NBCC will do project management again in that project and for that NBCC will charge. So, these are two basic models other than outright sale of the land. So, we are working in these two models and hopefully Kolkata and Chennai will be materialised.
Latha: When you last spoke with us you had said that your order book is about Rs 73,000 crore. What is the current tally and how much is implementable in one year?
A: Now it is about Rs 76,000; Rs 3,000 or 4,000 more we have added. In this financial year if I talk 2017-2018 I think out of Rs 76,000 we should touch Rs 9,000 to Rs 10,000 crore turnover or income whatever you call.The Great Diwali Discount!
Unlock 75% more savings this festive season. Get Moneycontrol Pro for a year for Rs 289 only.
Coupon code: DIWALI. Offer valid till 10th November, 2019 .
First Published on Jan 4, 2017 10:45 am