India’s Unity Infra sees Rs. 2.5-b Lanka project win in one month

Monday, 12 December 2011 00:00 -     - {{hitsCtrl.values.hits}}

MUMBAI (Reuters): Engineering, procurement and construction (EPC) firm Unity Infraprojects expects to win a 2 billion to 2.5 billion rupee housing project in Sri Lanka in a month, a top official told Reuters.

“We have already submitted the final bids and that result should come in a month’s time,” Chief Financial Officer Madhav Nadkarni told Reuters in an interview on Friday.

The residential project--the company’s first overseas--is to be built on contract, Nadkarni said, but declined to provide further details.

The company, which has also bid for similar projects in the island nation, is also reviewing various proposals in South Africa.

In June, Nadkarni had told Reuters the firm was scouting for EPC contracts in the Middle East, South Africa and Libya.

Indian infrastructure builders, including Larsen & Toubro and Lanco Infratech, have been bidding for overseas projects as they seek to diversify from the domestic market that is beset by fierce competition and regulatory uncertainty.

The Mumbai-based firm expects to be awarded in 30-45 days projects worth 15.50 billion rupees, most of which are government projects from Delhi and southern states of Andhra Pradesh and Karnataka.

“These projects should have materialised three months back, but unfortunately as the government was not acting on that, that has been delayed.”

Unity Infraprojects was the lowest bidder for projects worth 15.50 billion rupees and had been awaiting its awarding since Aug.

The company sees revenue in FY12 growing 20-25 percent and net profit 10-15 percent, as it expects pending orders to be awarded during the financial year.

“The PAT (profit after tax) would have been much more, had it not been impacted by interest costs,” he said. In FY11, net profit had risen about 12 percent.

In June, Nadkarni had said his firm targeted a 25 percent topline and 20 percent bottomline growth in FY12. In FY11, it posted a consolidated net profit of 960.37 million rupees on income from operations of 17.72 billion rupees.

India’s central bank raised interest rates in October for the 13th time on expectations that persistently high inflation will finally start easing in December.

The company expects to maintain net debt at present levels of 8.15 billion rupees as of December-end.