'We don't mind taking risks'

IN CONVERSATION

A pioneer in the development of IT infrastructure in Andhra Pradesh and elsewhere in the country, L&T Infocity Ltd has now changed its strategy from constructing multi-tenant IT complexes to building custom-made facilities for its clients. This may give the company a conservative look going by the way new players in this sector are fast coming up with a series of IT projects. But, R Sridharan, chief operating officer (COO) of L&T Infocity Ltd, says his company is aggressive in its own way, except in speculative plans. Instrumental in the construction of the Hitec City that has become the IT landmark of Hyderabad, Sridharan, who recently received the "Manager of the Year" award from the Hyderabad Management Association, shares his views and plans with Busness Standard.

Does competition bother L&T Infocity Ltd?

We are quite happy with the way we are doing. We don't see any competition. We are the pioneers and rest of them are following us. We take it that way. L&T built the country's first IT project, Tidal Park, in Bangalore. We came to Hyderabad to build Hitec City way back in 1996 when no one was willing to venture into such a project here. We invested in the development of IT infrastructure in Visakhapatnam in 2002 when others were sceptical about it. Now, everybody is coming up with their plans in the two cities. We don't mind taking the risk and facing the difficulties involved in the leadership role.

Companies like Rahejas has a couple of big projects on hand in Hyderabad though it made its entry into the city's IT space after L&T Infocity.

We build projects for present needs. Others may take up projects based on speculation. Some of these projects may be profitable three or five years down the line. But we don't speculate. We do a project exclusively for a customer who approaches us. We identify the client before taking up a project. The days of multi-tenant areas are more or less over now. Moreover, our company does not bid for a piece of land in an open auction or purchase a private land at Rs 5-10 crore an acre for a new project because it compromises the competitive edge of our client. What I mean to say is that land is a constraint now. We, too, are willing to do more projects if the government gives us land.

In the multi-player scenario, how do you distinguish yourself?

We do the fastest development of a project compared with any other in the industry. We are very fair and transparent in our deal. Our clients such as Motorola, HSBC, Delloit are happy with our services and continue to be with us in building their new facilities. We will be doing more projects for them. Even some of the new IT SEZ promoters in the city will be approaching us to construct facilities for their clients there.

What are your current plans in the city?

The company is planning to develop a joint venture IT Park over 25 acres of land for which we have got in-principle SEZ approval. A non-SEZ project is planned in a 10-acre land adjacent to it. A couple of other projects are in the planning stage at Nanakramguda and Manikonda. It will take some time to make an announcement in this regard. We want to do more such projects but where is the land?

What is the status of Hitec City? Industry sources say that prospective buyers have been bringing recommendation letters for the allotment of apartments in your new residential project falling in its vicinity.

The whole 100 acres have been utilised. Under the two phases of the project, L&T Infocity created about 3 million square feet of office space. Considering the Hitex and the International Convention Centre, our company has built another one million square feet space near the Hitec City.

As far as our 1,000-apartment residential project is concerned, we are not in a position to do any favour even if somebody comes with a recommendation letter as all of them have been booked. I myself could not move into a bigger apartment in the project. The company invested about Rs 250 crore in the first phase of the project and will be investing Rs 150 crore more in the second phase. More than 70 per cent of these apartments are owned by IT professionals.

Are you looking beyond Andhra Pradesh?

Yes. We are getting many enquiries from outside Hyderabad and from abroad as well. We were recently approached to build a second IT facility in Sri Lanka.

The Hitec City was built as a joint venture with the state-owned Andhra Pradesh Industrial Infrastructure Corporation, which holds 11 per cent equity in the project under public-private partnership model. How did it work?

It's all about the sincerity of purpose and singular objective of making the project successful.