NCC to yank Rs500 cr off debt with BOT and realty money

August 13, 2012

Infrastructure major NCC is working on a plan to pay off part of its debt by monetising its build-own-transfer (BOT) and real estate assets by the year-end.

The company currently has a debt of about Rs2,500 crore and if its plans work out well, the debt would come down to below Rs2,000 crore, said YD Murthy, NCC’s executive vice-president (finance), in an earnings-related interaction with analysts on Thursday.

However, he did not share details of the assets to be put on the block. The debt-equity of the company is below the threshold of 1:1 and the total debt in books low compared to the peer group companies, he said.

For the first quarter to June, the company’s revenue was at Rs1,816.5 crore and Ebitda at Rs204.2 crore or 11.2% of the revenue. However, the net profit was at 1.12% or Rs20.4 crore.

The company currently has an order book of about Rs20,520 crore, including the fresh orders worth Rs2,000 crore received in the first quarter.

“Environment this fiscal has improved and we are confident of registering a growth of 10-15% for the full year. We will be also able to deliver margins of about 8-9%,” he said.

NCC is planning to participate in road projects with the government likely to award about 9,000 km of road projects for development during the year.
The company, however, is likely to see delay in declaring the commercial operations of its 1,320 mw power project coming up at Krishnapatnam.

As against scheduled commissioning by 2014, it would now happen in March 2015.

“We expect the commercial operations of 660 megawatts capacity by March 2015. There were issues due to shifting of the project from Sompeta to Krishnapatnam and fresh efforts to achieve financial closure of the project,” Murthy said.

The company was originally planning to set up its project at Sompeta in Srikakulam. However, it had run into rough weather as the villagers opposed the project in a violent protest that led to police firing and deaths of two farmers.

The project was then shifted to Krishnapatnam near Nellore and all the related contracts, including fuel supply agreements (FSAs), were adjusted in favour of the project at the new location.

While about 70% of the coal requirement for the project would be met through supplies from Mahanadi Coal Fields, the company is exploring the opportunities in Indonesia to meet the other 30% requirement.

“We are expecting an FSA with Mahanadi in the next six to nine months. When developed, the greenfield mines in Indonesia would supply about 1.77 million tonne per annum. About $2 million has been invested already. We are also in the process of identifying some more mines in Indonesia,” Murthy said.


2 Comments on “NCC to yank Rs500 cr off debt with BOT and realty money” Post your comment

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