Will maintain 14-15% EBITDA margin in FY17: Gayatri Projects

Gayatri Projects reported good set of earnings for the fourth quarter of fiscal year 2016 on Monday.

Net profit went up 78 percent to Rs 28.5 crore year-on-year (YoY) and revenue grew 19 percent to Rs 668.2 crore.

Speaking to CNBC-TV18, Sandeep Reddy, MD of Gayatri said that the company’s current orderbook stands at Rs 10,000 crore. It has Rs 6000 crore worth of road projects and Rs 3000 crore of irrigation projects in hand.

Going forward the company will maintain EBITDA margins at around 14-15 percent in FY17, he said.Below is the verbatim transcript of TV Sandeep Reddy’s interview with CNBC-TV18's Nigel D'Souza and Reema Tendulkar. Nigel: In the last financial year you have done at around Rs 1,800 crore or thereabouts as the topline. Guide us for FY17, what kind of a number can we work with for FY17 in percent terms as well as absolute numbers? A: We have as on March 31 total order book of around Rs 10,000 crore and we have received new orders last year nearing Rs 5,000 crore of roads NHAI, Engineering, Procurement, and Construction (EPC) contracts. So, last year we could not achieve much traction because there were commissioning issues on site were there. All are getting sorted out. In this financial year we are expecting at least above 20-25 percent growth. Reema: What about margins? A: Margins we will maintain similar margins actually. Reema: 14 percent, roughly? A: 14-15 percent earnings before interest, taxes, depreciation and amortisation (EBITDA) margins. Nigel: Could you tell us how is your power business performing and also out of the Rs 10,000 crore you said you have received close to around Rs 5,000 crore from the roads space in terms of order inflows. Could you breakup the order book for us. Roads is Rs 5,000 crore, what is the remainder and also tell us how is your power business, how did it perform in the past quarter, in the past year PLFs etc? A: As I told you we have about nearly Rs 6,000 crore of roads. Then we have irrigation of around Rs 3,000 crore and also we have Western Railway corridor JV with L&T and other roads also put together it is above Rs 10,200 crore. Coming to our power business we have the entire thing called Sembcorp Gayatri Power Complex where we have four units of 660 megawatts where two units are fully commissioned and COD is achieved about six months back. We have achieve this financial year around more than 70 percent PLF and today we are running at above 90 percent PLF. And we have 85 percent long term PPA for the first two units. The other two units we have just synchronised one unit a few days back and we achieved a COD of the due date by end of June and the fourth unit by end of September will be the COD. Reema: Your finance cost is still very high. What is the current debt on your books. Are you comfortable with it or do you have plans to pare it down because you recently sold stakes to Sembcorp? A: Finances are not high in the sense that our net debt is around Rs 1500-1600 crore which includes working capital debt fiscal around Rs 850 crore and balance term loans of Rs 700 crore.