Strong orderbook aided Q4 nos; total debt at Rs 11,000 cr: HCC

HCC’s fourth quarter margins improved on back of a strong orderbook, said the company’s Managing Director Ajit Gulabchand. Infrastructure major Hindustan Construction Company (HCC) on Thursday reported in-line fourth quarter numbers with a 4.6 percent rise in total income at Rs 1,171 crore and a 12 percent rise in operational efficiency (EBITDA) to Rs 218 crore.The company received Rs 7,000 crore worth orders in FY16, which takes the orderbook to a total of Rs 20,000 crore, its highest in last five years, Gulabchand said. Arbitration claims stood at Rs 11,000 crore, of which Rs 3,041 crore is yet to be received by the company. HCC's consolidated debt stands at Rs 11,000 crore and standalone debt is at Rs 4,900 crore. Gulabchand said that while the company has tried reducing debt by selling road assets, some assets cannot be sold off due to commercial operation date (COD) issues. Below is the transcript of Ajit Gulabchand’s interview with Kevin Lee on CNBC-TV18.Q: What contributed to improving the margins of the company?A: The order book has improved considerably. We have had almost Rs 5,000 crore plus of orders, Rs 7,000 crore of orders received during the year. And, with the orders in which we are the lowest, if they come through, the order book goes to almost Rs 20,000 crore which is the highest in the last five years.Q: So, what is the amount of money that you are yet to receive from arbitration?A: Our total claims that have been pending at various stages are about Rs 11,000 crore. However, about Rs 3,041 crore awarded to us, we have just received the money for. And this is the real pain that has been caused to the company.Q: So, where does your consolidated debt stand at right now?A: Consolidated debt which includes all the companies, including our infrastructure company which naturally will have a higher debt as well as Lavasa is about Rs 11,000 croreQ: And of that, HCC’s standalone debt would be?A: Rs 4,900 crore.Q: So you have been trying to pare debt. Is there any particular strategy, maybe you are selling non-core assets?A: Primarily, there are not really any non-core assets. We are in the business of construction. Our company, there is subsidiaries, Switzerland is also in the construction business. When you take road construction businesses, it is a little off but it is primarily, a lot of construction companies have been into it. And we do want to pare off. We have sold most of the roads we have. With some of these, we are not able to sell immediately, because you can only sell them off, commercial operations date (COD) is completed two years after. So, that process is underway.