Aim to achieve Rs 2,000 crore in revenue for FY16: MEP Infra

MEP Infra’s third quarter results announced on Tuesday saw significant operational improvement.

EBITDA margins increased by 8 percentage point to 27 percent year-on-year (YoY)and consolidated net profit stood at Rs 5.27 crore against loss of Rs 35 crore (YoY).

In an interview with CNBC-TV18, Jayant Mhaiskar, VC and MD of MEP Infra said that the company has an orderbook of Rs 1300 crore for long term contracts and Rs 600-700 crore worth one year contracts.

MEP is likely to achieve Rs 2000 crore worth revenue in FY16 on the back of its present orderbook, he added.Below is the transcript of Jayant Mhaiskar’s interview with CNBC-TV18's Mangalam Maloo and Reema Tendulkar. Mangalam: The strong improvement that we have seen in the earnings before interest, taxes, depreciation and amortisation (EBITDA) margins, is that sustainable? 27 percent of EBITDA margins that have come in what is the sustainable level going forward? A: We have declared our Q3 results as of today. As you rightly said EBITDA margins have significantly shown good strength in that. Predominantly we had given a guidance during the first quarter and second quarter on the same. We would be able to clock an EBITDA of the current trajectory and should be doing an EBITDA close to Rs 600 crore. Reema: Rs 600 crore EBITDA would be for FY16? A: FY16 consolidated. Mangalam: Could you also give us some sense on what was the traffic growth in this quarter and how did it pan out in terms of commercial vehicles as well as passenger vehicles? A: As far as the traffic growth is concerned it is an annual phenomena. Predominantly the second quarter which has monsoon always has a dip in traffic resulting in reduction of revenue. As far as the current quarter is concerned we have definitely clocked a good amount of growth both in terms of commercial as well as light commercial vehicles, particularly in the urban areas the traffic growth has been good, to the tune of almost 5.5 - 6 percent as well as on the national highways. Reema: EBITDA of Rs 600 for FY16. What would be the potential revenues that you are likely to see in the first nine months. You have see revenues close to Rs 1,500 crore. A: That is correct. We had given our guidance in the last couple of quarter as well that we are on track in terms of the total revenue in excess of Rs 2,000 crore in terms of the order book what we have. This is apart from what new bids we would be participating in this current quarter. Reema: And what is the total order book? A: We have an order book of close to Rs 1,300 crore for the next seven years on an annualised basis. This is the long term basis and also an order book of almost Rs 600-700 which we do on a yearly basis which is a one year tolling. Mangalam: Could you also give us some colour on the update of your Mumbai entry points project as well because we understand it was supposed to be profit after tax (PAT) positive by FY17. So, has it broken even on cash level and what is the update there? A: Yes, as far as the Mumbai project is concerned we did the Initial Public Offering (IPO) in May 2015. The main issue proceeds have been used towards the repayment of good amount of debt on the Mumbai project close to around Rs 260 odd crore. Having said that as far as this project is concerned it has turned PAT positive in the last two quarters and we continue to do that.(Copy edited by Sidhartha Shukla, interview transcribed by Binu Panicker)