Construction and infrastructure company IVRCL Ltd has entered into new areas of business such as mining, railways and metro rail, and is looking at increasing its business from overseas markets.
The Hyderabad-based company is expanding the portfolio of services with the objective of de-risking the overall business.
The growth in revenue for the extended financial year ended September 30 was down by about 11 per cent on an annualised basis due to slow progress of some of the major projects.
This was also due to lack of availability of fronts and permissions at various stages hampering construction work.
Last fiscal ended September 30 (extended period of 15 months) to complete the restructure of IVRCL. It closed with revenues of Rs 6,178 crore against Rs 5,651 crore for the previous financial year.
The company added new orders worth Rs 9,330 crore during the 15 months in spite of decelerating growth momentum across all sectors and the order book position now was at Rs 27,130 crore.
When contacted, IVRCL Executive Director Finance, R. Balarami Reddy, told Business Line that the company expects the market conditions to get better facilitating the growth of infrastructure sector.
Construction expenses
“We have raised claims from some of our clients and are hopeful of securing additional revenues,” he said.
The company in its annual report for 2011-12 maintained that the construction expenses as a percentage of net operating income improved. Increase in employee cost and other administrative expenses are attributed to negative turnover growth.
These expenses are variable in nature.
Increase in finance cost is mainly due to interest rates. Lower profit was attributed to finance cost.
The company management believes opportunities for engineering, procurement and construction industry will grow as the economy expands.
RAISES CLAIMS
The company has raised claims of about Rs 1,700 crore with some of the clients towards deviation of design and idle time charges. Of this, claim amount of Rs 8,300 crore is under arbitration.
rishikumar.vundi@thehindu.co.in