BackConstruction firm NBCC to invest Rs500 crore to acquire 2 loss-making PSUs
State-owned construction firm NBCC will invest around Rs500 crore from internal accruals to acquire two loss-making firms, says managing director Anoop Kumar Mittal
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Mumbai:State-owned construction firm NBCC plans to invest around Rs500 crore to acquire majority stake in two loss-making public sector firms, a top company official said.
“We are gradually moving towards consolidation in the construction business. As a part of the strategy, we acquired loss making HSCL. We will be completing the acquisition of two more PSUs by the second quarter of this fiscal," company’s chairman-cum-managing director Anoop Kumar Mittal told reporters in Mumbai on Friday.
He added that the company will invest around Rs500 crore from internal accruals to acquire the other two loss-making firms. Last year the company acquired 51% stake in Hindustan Steel Works Construction (HSCL), also a public sector company under the steel ministry, with an investment of Rs35.70 crore.
“Like HSCL, these two firms are also engaged in the construction business and therefore their acquisition will be strategic. Also, both these firms have a cumulative order book of around Rs15,000 crore. So with the acquisition, these orders will be a part of our order book," Mittal added.
Currently, the company’s order book stands at around Rs80,000 crore and it hopes to add around Rs20,000 crore.
“With the addition of orders from HSCL, which was around Rs4,000 crore when we acquired it and the Rs15,000 crore orders from the new acquisitions, we will cross Rs1 trillion mark in order book this fiscal," he said.
“We also hope our revenues will increase by 35% to Rs10,000 crore this fiscal," Mittal added.
The company is looking at expanding its presence in 10 new geographies, he said, adding, “currently we are present in three countries and we are planning to expand in 10 other countries. Nine out of these will be in Africa and one either in Dubai or Abu Dhabi."
NBCC is also considering developing real estate projects on lands of sick public sector undertaking (PSU) or loss making PSUs or that available with the government, mainly on self revenue generation model.
“We have quite a few land parcels and we are working on 4-5 of those. We plan to develop large townships, or mixed-used developments, or use it for creating affordable housing or high-end luxury residential with commercial space, among others. By the end of the calendar year, we will be finalising two projects with one in the NCR and the other either in Hyderabad or Kolkata," Mittal said.
He said these land parcels are mostly around 80-100 acre, while a few are of 1,000 acres.
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