Hyderabad-based infrastructure development and construction company NCC Limited (NCCL), which posted a turnover of Rs 6,665 crore in 2011-12, expects a 10 per cent growth in the current financial year.
“Last year was a bad a year. This year, things are looking up,” NCCL’s executive vice-president (finance),YD Murthy, told Business Standard.
The net profit of NCCL, which is among the top 100 companies in the country in terms of turnover, has declined to Rs 55 crore last year from Rs 222 crore in the previous year.
Murthy attributed the 75 per cent erosion in profit after tax to the prevailing macro-economic environment in the country on account of which “all companies suffered”.
“There was a delay in the payment of our bills by our customers. The debt collection period, which used to be three months on an average, has gone up to four months. We have suffered a lot because of this,” he said, adding that the high interest rates had also affected the company.
Currently, he said, there were some “positive developments” at the Centre with the Prime Minister, Manmohan Singh, indicating that there would be a thrust on infrastructure development. “We also expect that there will be a reduction in the interest rates”.
According to Murthy, the infrastructure sector had now reached the bottom of the business cycle and hence will go only forward hereafter.
He was confident that the Centre would be achieving its target of spending $1 trillion on infrastructure development during the 12th Plan period. In this context, he pointed out that the government had spent the targeted amount of $500 million on infrastructure development during the 11th Five-Year Plan.
At the same time, Murthy said that the period aggressive bidding for road projects to be executed on build, operate and transfer (BOT) basis was over. “We are waiting for our time. We will secure road projects at our own rates,” he said.
Meanwhile, NCCL is also considering monetising some of its road projects and utilise the proceeds for its future growth. At present, the company has five road projects under its fold.
Murthy said that the Rs 7,047-crore thermal power project being set up at Krishnapatnam in Nellore district of Andhra Pradesh would be completed as per the schedule.
“We have achieved financial closure and the work is under progress. The Phase-I of the project comprising 660 Mw will be completed by March 2015 and the Phase-II of equal capacity will be commissioned three months later by June 2015.” The 1,320-Mw project, being jointly developed by NCCL and the Gayatri group, has coal linkage from Mahanadi Coal Fields.
