Lanco Group to consolidate biz, eyes Rs8,000cr topline by '10

In a major restructuring drive, Hyderabad-based Lanco Group has decided to consolidate all its businesses in power, realty and construction into one holding company even as it eyes a more than six-fold jump in revenues to Rs 8,000 crore by 2010.

The group has also charted out big expansion plans in power sector involving a capex of Rs 13,000 crore in the next four years to ramp-up generation capacity by 2,500 MW. 

"We are consolidating all our 14 subsidiaries in power, construction and realty sectors into one holding company - Lanco Infratech," L Madhusudhan Rao, chairman of Lanco Group, told PTI.

The promoters would hold about 90% in the new company, he said, adding the process of restructuring was on and would be completed shortly.

This is in line with the group's objective of achieving a revenue of Rs 8,000 crore by 2010 from about rs 1,200 crore at present, he said, adding the asset base is also expected to increase to Rs 25,000 crore from Rs 2,200 crore now.

The company is also planning to bring strategic partners in both the holding company as well as subsidaries. "For bringing strategic partners in our holding company we are talking to investment bankers," he said, adding that not more than 10% would be offloaded in the holding company.

On expansion in the power sector, he said the group would be adding 2,500 MW to take its total generation capacity to 3,000 MW by 2010.
In the added capacity, 1,600 MW would be through coal-based plants while 900 MW would be via hydropower projects. The investment would be made on a debt-equity ratio of 75:25, Rao said.