IVRCL bags 4 irrigation deals worth Rs 923 cr

Hyderabad-based IVRCL Infrastructures & Projects Ltd (IVRCL) today announced that the Andhra Pradesh government, through the Department of Water Resources (Irrigation), has awarded four irrigation contracts worth Rs 923 crore to one of its joint venture companies, IVRCL Prasad Sew.

IVRCL has a 50 per cent stake in the three way joint venture while Sew and Prasad hold 25 per cent each.

The single biggest contract is for the Polavaram project at Rs 295 crore, while two contracts for the Telugu Ganga project are worth Rs 432 crore, and the SRSP (Sri Ram Sagar Project) project is worth Rs 196 crore.

E Sudhir Reddy, vice chairman and managing director, IVRCL told Business Standard that the company would complete the entire work in the next 30 months.

"This is an engineering, procurement and construction project (EPC project) which would also include survey and investigation. We expect revenues to start accruing in the last quarter of this fiscal," Reddy said.

IVRCL expects revenues of between Rs 100 crore and Rs 150 crore to accrue in the last quarter, depending on the survey and investigation work being completed on time. Overall IVRCL expects 50 per cent of the contract size to accrue to it.

With this win, the order book position of IVRCL has improved to more than Rs 2,500 crore and it is now sure that the targeted level of turnover of Rs 1,200 crore for the current financial year will be achieved.

"It is normal that the company's turnovers are around two-third of the annual turnover during the second half of each financial year and this would lend support to the company's projection of increased turnover and profitability," the company said in a statement.

The operating margins of the company have been on the rise in tune with the industry trends and are expected to further improve with the strengthened order book position. The company is actively pursing plans for getting export order for construction services.