Ramky Infrastructure Ltd, the Hyderabad based infrastructure company engaged in transportation and water verticals, sees the urban water management emerging as the next big opportunity unfolding in the country.
The company, part of the Ramky Group into real estate, environment development, infrastructure, which tapped the market in October 2010, is on course to being a billion dollar business possibly during the year. But the rupee weakening could potentially upset this target.
“The Government is likely to open up the urban water management projects for private sector next year. This augurs well for specialised services providers such as Ramky, which is among the select few handling this arena. The whole area of water management is likely to be sourced through third parties. This is one big opportunity,” Mr Gautham Reddy, Managing Director of Ramky Infrastructure, said.
During interaction with
How has been the company progress since the IPO?
After the successful public offer in October 2010, we have consistently delivered quarter after quarter and beyond initial projected levels. We now have an order book of Rs 12,000 crore – adequate for the next three years. However, the share prices have come down as the Sensex is down due market conditions.
Transportation and water have been your main business thrust areas, which are the other segments that you are looking at?
We are targeting new areas of business in oil and gas transportation, which is in some ways extension of water business, mining, where we have recently won a contract and are bidding for more and railways contracts. The Railways is emerging as big opportunity for infrastructure players like highways. However, the company's thrust continues to be on EPC business.
The company is executing about eight road projects and bidding for several others. However, we believe that recently there has been aggressive bidding for road projects. Maybe we are better off not chosen in some of them. Only time will tell whether those who have won have done the right thing.
How do you see your financials going ahead? Is there margins pressure?
We closed last fiscal ended March 31, 2011 with a consolidated revenue of Rs 3,150 crore. While we do not give guidance in terms of percentage of growth, the first half has been good and if the rupee firms up we may become a billion-dollar company this year itself. However, it all depends how rupee fares against the dollar. There have been a few challenges for the sector, commodity prices are going up, so is the case with manpower and transportation cost apart from cost of procurement of items. Finance costs too have gone up leading to margins pressure particularly for EPC business.