Ramky Infrastructure sees Rs6,000 cr orders till March

August 23, 2011

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Ramky Infrastructure Ltd, a South-based construction and infrastructure development company, is expecting an additional order inflow of about Rs6,000 crore in the rest of the current fiscal.

At present, the company’s order book has been pegged at about Rs12,000 crore in the engineering, procurement and construction arm, in addition to about 16 build-own-transfer (BOT) projects under execution.

In the first quarter ended June 2011, the company recorded fresh order inflows worth about Rs1,600 crore. “There is a strong pipeline of another Rs1,200-1,300 crore. Bids worth about Rs11,000-12,000 crore are yet to be opened. So, we are confident of getting another Rs6,000 crore worth orders during the year,” M Gautham Reddy, executive director of Ramky Group, said.

However, he said, the company was not aggressively looking at piling up the orders. “We are not aggressively pursuing orders. We have a philosophy of making optimum use of men, material and capital. We will follow that. We have not set any target for order-book expansion,” he said.

The current order book is dominated by three sectors with roads & bridges contributing about 35% followed by water and waste water management (22%) and buildings (16%). While the company expects the average earnings before interest, tax, depreciation and amortisation (Ebitda) margins to hover between 11% and 11.5%, what is likely to impact is the interest rate burden.

Currently, the company’s debt carries an interest of about 12%.

“There is a possibility of these rates going further up by 0.50%. But, that’s where the rates are expected to peak out,” he said.
In the BOT segment, Ramky currently has five road projects including four annuity projects and one toll project. “Our exposure to NHAI projects is not much. One of the four annuity projects is a Hyderabad outer ring road project offered by the state government. We have already achieved

COD for the project. The other is a Gwalior bypass of the NHAI. This is yet to achieve the COD. The other two projects in Jammu and Kashmir and Assam have achieved financial closure,” he said.

The only toll project — a state road between Narketpally and Addanki in AP connecting to a Chennai road — is still being developed.

Meanwhile, the company is gearing up to replicate its prestigious integrated industrial park concept in Africa. The company has developed a pharma city near Visakhapatnam to cater to the needs of the pharmaceutical sector.

“A similar concept is now being adopted for a project in Africa. We have been asked to develop a timber SEZ, an industrial park to cater to the needs of timber processing in Africa. It is a $89 million project and the works are expected to commence during September-October this year,”he said.

Source: dnaindia.com