PNC Infratech has opened its public issue of up to 1,29,21,708 equity shares for subscription Friday. The price band of the issue is Rs 355-378 per equity share. In an interview to CNBC-TV18, Yogesh Kumar Jain, Promoter Director, PNC Infratech, speaks on the IPO and why one should subscribe to it.
Below is the transcript of Yogesh Kumar Jain’s interview with Anuj Singhal and Ekta Batra on CNBC-TV18.
Anuj: From retail investors point of view what is unique about your company, why should they invest in your IPO?
A: First of all I will tell you about our company. PNC is the core construction company with presence in highways, runways and railway sector. We have completed almost 42 major projects all over in India in the 13 state out of which 24 are from highway sectors and 17 is runway and one industry project. We have robust order book of around Rs 7,850 crore, out of which we have already executed Rs 4,300 crore so now the balance work in hand is Rs 3,500 crore. We have complete employee base of 3,500 with 279 engineers, 49 MBAs and around 20 chartered accountants. We are also having build–operate–transfer (BOT) mix portfolio and engineering, procurement and construction (EPC) contract also.
Ekta: You are looking to raise between Rs 459-488 crore. Can you just tell us what the utilisation of funds will be?
A: Yes Rs 150 crore for the working capital and Rs 65 crore for the equity investment in our one of the project Raebareli Jaunpur and Rs 85 crore for the capital equipment purchase, around Rs 100 crore for the corporate purpose and around Rs 55 crore for offer sale.
Anuj: I am looking at your last year’s financials and they are not actually inspiring. Your revenues only went up 4 percent and profit actually came down 30 percent…
A: Your are talking about the consolidated account but in our PNC standalone, our top line is increase around 48 percent and bottom line is increase 67 percent in 9 month, so last three years are the bad time but now we are doing well.
Ekta: But what is the difference between your standalone and your consolidated numbers?
A: The consolidated balance sheet shows loan with BoT project so bottom line it decrease due to BoT projects.
Ekta: And standalone is?
A: Standalone is totally EPC contract balance sheet.
Ekta : Can you tell us about what your plans are on the consolidated debt front because what is your current debt stand at this point in time and I didn’t hear you exactly mention if you were going to reduce your debt with the IPO proceeds. A: Yes we will reduce this working capital debt so our working capital we are using Rs 300 crore working capital debt and Rs 30 crore is only for long-term debt so we will reduce this working capital debt.
Ekta: So how do you plan to bring down your long-term debt eventually or what would be the levels that you would be comfortable with?
A: Long-term debt is only from the BoT and we will pay out this Rs 30 crore from the IPO proceeds.
Ekta : And what does your total debt stand at, total consolidated long-term debt?
A: Total consolidated long-term is around in this balance sheet around Rs 1,100 crore.
Ekta: So you will only reduce Rs 30 crore.
A: This is from the due to BoT project so BoT project special purpose vehicle (SPV) we will pay out by the toll or from SPV earning. I am talking about on the standalone Rs 30 crore.
Anuj: Your business model is mostly around UP, any diversification that you are planning.
A: We have already worked in 13 states of India but we have our strength area Uttar Pradesh, Haryana, Madhya Pradesh, Rajasthan and Punjab.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
