Anil Ambani-led Reliance Infrastructure Ltd (RInfra) has posted a 22 per cent fall in consolidated net profit at ₹334 crore for the first quarter ended June 30, compared with ₹439 crore recorded during the same period a year ago.

On a standalone basis, the company’s net profit for the reporting quarter rose 5 per cent to ₹417 crore.

The company’s two major business verticals — power generation, transmission and distribution business and defence business — posted declines during the quarter under review.

Reliance Power’s net profit fell 32 per cent to ₹231 crore (₹340 crore). Reliance Defence and Engineering Ltd’s (RDEL) net loss widened to ₹230 crore from a loss of ₹134.5 crore in the corresponding quarter of the previous fiscal.

RInfra’s total income rose 4 per cent to ₹7,848 crore (₹7,538 crore). The growth mainly came in from its power business, which contributes the main part of RInfra’s total revenue.

The company’s EPC business registered revenues of ₹591 crore in the first quarter, with an order book of about ₹5,721 crore. It won a new tender of about ₹1,200 crore for two packages of upcoming Mumbai Metro Line 2B and Metro Line 4, sources had told BusinessLine earlier.

The bids were opened on Tuesday, but the winners are yet to receive official confirmation.

According to Lalit Jalan, CEO of RInfra, in the EPC business, the company is targeting an at least ₹15,000-crore order book annually as it is gearing up to bid for projects worth at least ₹1 lakh crore.

The main focus areas of this vertical are roads, metros and power projects. The company is also keen on expanding the operation and maintenance (OEM) business in these areas.

Apart from the EPC vertical, the company’s main focus remains on power and defence businesses, Jalan added.

Deleveraging strategies Debt remains one of the concerns, although the company could reduce its debt to equity ratio from 1.5 in FY16 to 1.2 in FY17. RInfra’s debt on a consolidated basis is about ₹29,000 crore, which, according to Jalan, is expected to fall to ₹20,000 crore as a result of various initiatives.

Firstly, the company expects to receive at least 75 per cent of arbitration awards from Delhi Metro Rail Corporation (DMRC), which, including interest, amounts to ₹4,725 crore.

Ongoing arbitration The company said there is ongoing arbitration for another five projects, and it is preparing to go for arbitration for four more.

Secondly, RInfra is planning to deleverage by another ₹2,500 crore through the Infrastructure Investment Trust (InvIT) route. According to Jalan, the company may go public with its InvIT by the end of the current quarter.

Divestment of power transmission business is considered another option for reducing debt.

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