The Hindu Business Line : Ircon plans to enter real estate, hydel sector

BACKED by a strong order book position, Ircon International, the Indian Railways' public sector unit specialising in construction, now plans to diversify into real estate and hydroelectric projects, apart from focussing strongly on urban transport projects as well. It plans to bid for Chandigarh's monorail project.

It is aiming for a turnover of Rs 2,000 crore by 2010 against Rs 1,014 crore in 2004-05. In the current fiscal, the Mini-Ratna PSU expects a turnover of Rs 1,100 crore.

"Given our current order book position, we are poised for a quantum leap in turnover starting next fiscal (2006-07). We are poised for a Rs 2,000-crore turnover by 2010," Mr B.S. Kapur, Managing Director, Ircon International, told Business Line.

The order book position of the PSU has grown impressively over the past few years. In 2000-01, Ircon had obtained fresh orders worth Rs 629 crore, where as in 2001-02, the PSU's order book declined to Rs 482 crore. However, in 2002-03, the company bagged orders worth Rs 1,240 crore, which further went up to a high of Rs 1,867 crore. This fiscal, by December 2005, Ircon had bagged Rs 1,140 crore of orders, said Mr Kapur.

Moreover, Ircon plans to diversify into real estate and hydroelectric projects and is on the lookout for partnership in these areas. It has received proposals from various players in each of these areas and is evaluating them at present.

"We are on the lookout for serious players with experience in real estate and in construction of hydroelectric projects for partnerships," said Mr Kapur. On the kind of projects that Ircon is eyeing within real estate he said, "It could be in housing, township, amongst others." The tie-ups would target domestic project initially.

Ircon is also entering into an agreement with its sister concern IRCTC (Indian Railway Catering and Tourism Corporation) to construct budget hotels as planned by the Ministry of Railways and IRCTC.

In the urban transport segment, Ircon plans to bid for Chandigarh's monorail project. It has also made presentations to the Delhi Government and plans to make a presentation to the Gujarat Government soon.

The PSU has a tie-up with a Malaysian company with expertise in monorail, M-Trans Holdings. The tie-up has been called Ircon-M-Trans Joint Venture to work together for the planning and construction of monorail projects in various cities in India.

Ircon has traditionally done engineering, construction management projects for various railways and highways that involves expertise in signalling and telecom, amongst others.