 "IVRCL to retire Rs 2,500-cr debt by March 2015")
The company’s chairman and managing director, E Sudhir Reddy, told mediapersons on Monday that talks pertaining to the sale of assets were in the final stages and the deals were expected to be closed in a couple of months. He was hopeful that IVRCL would come out of the red in the next financial year.
Currently, the consolidated debt of the company stood at Rs 6,500 crore. It had incurred a net loss of Rs 716.78 crore for the year ended March 2014.
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Reddy said that IVRCL had put on block all its BOT assets comprising seven road projects and one desalination plant. Of these, the desalination plant near Chennai had already been sold, while the sale of three road projects -- Indore-Jhabua in Gujarat, Madurai-Kanyakumari in Tamil Nadu and Jalandhar- Amritsar in Punjab -- would be completed by March.
The remaining four road projects would be sold in 2015-16 as part of the company's strategy to exit all BOT projects and focus on water and EPC projects. At present, he said, 55 per cent of the Rs 18,000 crore order book of the company pertained to water projects.
Following this, according to Reddy, IVRCL would be retiring debt to an extent of Rs 3,500 crore. This would also lead to an inflow of about Rs 1,500 crore into the equity of the company, besides reduction of the interest burden by Rs 300-350 crore. The company paid an interest of Rs 650 crore in 2013-14.
“The whole idea is to take back the company’s top line to the earlier levels of Rs 8,000 crore,” Reddy said, adding that the company would resort to sale of its real estate assets after the disposal of BOT assets. IVRCL has a landholding of 1,700 acre spread over Chennai, Pune, Bengaluru and Visakhaptanam. The current market value of these land parcels was estimated at Rs 3,000 crore.
Stating that the “worst was over”, IVRCL joint managing director, R Balarami Reddy, said that the company would wipe out its accumulated losses of about Rs 800 crore in two to three years. He expects the company’s turnover to touch Rs 6,500 crore in 2015-16, as against a turnover of Rs 4,304.80 crore in 2013-14.
Sudhir Reddy, however, said that the company would be able to wipe out its accumulated losses within a year “if there is a real estate boom”. The future plans of the company included roping in a strategic partner or raising Rs 300 crore through qualitative institutional placement during the next fiscal for which it had already obtained shareholders approval.
“We might increase the promoters stake in the company by 10 per cent in two or three tranches,” Sudhir Reddy said replying to a query. Two years back, IVRCL faced an unsuccessful hostile take over bid made by Essel Group.