See 15% topline growth in FY13: Nagarjuna Construction

Nagarjuna Construction's net profit stood at Rs 8 crore against Rs 11.4 crore in the corresponding quarter last fiscal. The company's total income rose to Rs 1531 crore versus Rs 1090 crore year-on-year.

YD Murthy, Exec VP-Finance, Nagarjuna Construction said the company at present has an order book of Rs 19500 crore and orders have picked up in Q2. However, interest costs have been quite high and amounted to Rs 100 crore in the second quarter of FY13. Going forward, Nagarjuna is looking at a topline growth of around 15 percent for the entire year.   Here is the edited transcript of the interview on CNBC-TV18. Q: Just take us through how you have done in your Q2 numbers and what have margins come in at for this quarter?
A: On a standalone-basis in Q2, we have done a top-line of Rs 1352.7 crore and net profit of Rs 8.05 crore. The top-line growth is 21 percent compared to Q2 of last year. In Q1 of this year we have grown by about 28 percent. So, the top-line growth is picking up and is a good sign for us.
On a consolidated-basis, the turnover is Rs 1,639 crore and the profit is Rs 11.35 crore. The top-line growth on a consolidated-basis is about 10 percent. The 6 month figures on a standalone-basis is Rs 2,848 crore and EBITDA is Rs 228 crore, net profit is Rs 24.6 crore. Q: What were the margins for this quarter on a standalone basis?
A: On a standalone basis we have an EBITDA margin of 8.2 percent and net profit margin of 0.6 percent. Q: There was an expectation that perhaps you could see a bit of a surge in your interest costs, what have those been recorded at?
A: Interest cost is the biggest worry as of now. Due to that our net profit margins are suppressed. At EBITDA level we are already at around 8.2% which is a decent margin. The real problem is because of the high interest costs in Q2 and the interest burden is as high as Rs 100 crore. For the first six months of the year, the interest burden is about Rs 195 crore.
_PAGEBREAK_ Q: What have you ended the quarter with your order book looking like?
A: Order book is around Rs 19,600 crore at the end of the second quarter. We bagged fresh orders of Rs 2,621 crore in the first six months of the current year. Q: How has execution been this quarter as opposed to order inflows?
A: Execution is picking up. The execution is more than the order booking in the first six months of the current year and it has never happened before in our history. It means that execution is picking up and the top-line growth in the second quarter is 21 percent after a 28 percent growth in the first quarter. Q: Your earlier guidance for revenue stood at around 10-15 percent growth and the margin picture in terms of guidance was around 8-9 percent. Would you stick by that or would there be any revision in terms of your guidance for the fiscal?
A: It is only the indicative direction we have given but ramp up in execution is helping us to show a better topline growth in the first two quarters. We hope it will continue but nevertheless we will not modify the guidance. Maybe around 15 percent topline growth for the year as a whole is a certainty. Q: What about working capital days?
A: Working capital days has improved to 88 days in Q2, earlier it was as high as 120 days. That was a very good improvement and that is helping us to release working capital which eventually will help us to bring down the debt levels in the company. Q: You had guided that you will be able to bring your debt down to Rs 2000 crore by the end of FY13, are you on track to doing that?
A: Yes some progress is there. We are confident. We will be able to achieve that.