Gayatri Projects Limited has informed the Exchange regarding Investor Presentation.With reference to above subject, please find enclosed presentation to Analysts and Market on results for the quarter ...
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G^yATRr
Date: 19th February, 2019
To, The General Manager, The Department of Corporate Relations' The Bombay Stock Exchange Limited, 25th Floor, Phiroz Jeejeebhoy Towers, Dalal Street, Mumbai- 400 001.
To, The Secretary, National Stock Exchange of India Ltd, sth Ffoor, Exchange Plaza, Plot No.C/1, G Block, Bandra Kurla Complex, Bandra (East), Mumbai -4O0 051.
Dear Sir/Madam.
Sub: Presentation on Q3 FY-19 Results to Analysts and Market Reg..,
:.:1'.:::::'.i.::::i:::1:1.:.:::::::].¡.¡.¡.!.¡..¡¡..¡¡¡..!..¡....¡...¡.¡¡¡..¡ With reference to above subject, please find enclosed presentation to Analysts and Market on
results for the quafter ended December 31, 2018,
For your information and necessary dissemination please,
Thanking you,
Yours truly, FoT GAYATRI PROJECTS LIMITED
$uþüYt
(cs r.v. LAKSHMT) Company Secretary and Compliance Officer Membership No. L76O7
Regd. & Corp. Office : Gayatri Projects Lim¡têd, 81 , 6-3-1090, TSR Towers Raj Bhavan Road, Somajiguda, Hyderabad 500 082. T.S C I N: L99999TG1 989PLC057289
T +s1 402331 0330 /4284/4296 F +91 40 2339 8435
E gplhyd@gayatri.cÕ.in www.qayatri.co. in
Gayatri Projects Limited
Earnings Presentation Q3 FY19
Disclaimer
The material that follows is a Presentation of general background information about the Company’s activities as at the date of the Presentation. It is information given in summary form and does not purport to be complete and it cannot be guaranteed that such information is true and accurate. This Presentation does not constitute a prospectus, offering circular or offering memorandum or an offer, or a solicitation of any offer, to purchase or sell, any shares and should not be considered as a recommendation that any investor should subscribe for or purchase any of the Company’s equity shares.
This Presentation includes statements that are, or may be deemed to be, “forward-looking statements”. These forward-looking statements can be identified by the use of forward-looking terminology, including the terms “believes”, “estimates”, “anticipates”, “projects”, “predicts”, “aims”, “foresees”, “plans”, “expects”, “intends”, “may”, “will”, “seeks” or “should” or, in each case, their negative or other variations or comparable terminology, or by discussions of strategy, plans, aims, objectives, goals, future events or intentions. These forward-looking statements include all matters that are not historical facts. They appear in a number of places throughout this Presentation and include statements regarding the Company’s intentions, beliefs or current expectations concerning, amongst other things, its results or operations, financial condition, liquidity, prospects, growth, strategies and the industry in which the Company operates. By their nature, forward- looking statements involve risks and uncertainties because they relate to events and depend on circumstances that may or may not occur in the future. Forward-looking statements are not guarantees of future performance including those relating to general business plans and strategy of the Company, its future outlook and growth prospects, and future developments in its businesses and its competitive and regulatory environment. Neither the Company, nor its Directors, Promoter & Promoter Group, affiliates or other advisors or representatives nor any of its or their parent or subsidiary undertakings or any such person’s officers or employees gives any assurance that the assumptions underlying such forward-looking statements are free from errors nor do any of them accept any responsibility for the future accuracy of the forward-looking statements contained in this Presentation or the actual occurrence of the forecasted developments. Forward-looking statements speak only as of the date of this presentation. As a result, the Company expressly disclaims any obligations or undertaking to release any update or revisions to any forward-looking statements in this presentation as a result of any change in expectations or any change in events, conditions, assumptions or circumstances on which these forward-looking statements are based. No representation, warranty or undertaking, express or implied, is made or assurance given that such statements, views, projections or forecasts, if any, are correct or that the objectives of the Company will be achieved. The Company actual results of operations, financial condition and liquidity, and the development of the sector it operates in, may differ materially from those suggested by the forward-looking statements contained in this Presentation. In addition, even if the Company’s results of operations, financial condition and liquidity, and the development of the industry in which the Company operates, are consistent with the forward-looking statements contained in this Presentation, those results or developments may not be indicative of results or developments in subsequent periods.
The Company, as such, makes no representation or warranty, express or implied, as to, and does not accept any responsibility or liability with respect to, the fairness, accuracy, completeness or correctness of any information or opinions contained herein. The information contained in this Presentation, unless otherwise specified is only current as of the date of this Presentation. None of the Company, its Directors, Promoter and Promoter Group or affiliates, nor any of its or their respective employees, advisors or representatives or any other person accepts any responsibility or liability whatsoever, whether arising in tort, contract or otherwise, for any errors, omission or inaccuracies in such information or opinions or for any loss, cost or damage suffered or incurred however arising, directly or indirectly, from any use of its documents or its contents or otherwise in connection with this Presentation. The Company assumes no responsibility to publicly amend, modify or revise any forward looking statements, on the basis of any subsequent development, information or events, or otherwise. This presentation has been prepared based on the information available in the public domain and internal management information and estimates. The information contained herein is subject to change without notice. Past performance is not indicative of future results.
2
Agenda
1.
Gayatri Projects – An Introduction
2.
Q3FY19 Highlights
3.
Order Book Diversification
Slide No. 4
Slide No. 5 - 9
Slide No. 10
4.
5.
6.
7.
8.
Top Work Orders – Status update
Slide No. 11 - 12
Medium Term Strategic Priorities and Guidance
Key Investment Highlights
Slide No. 13
Slide No. 14
Digital Project Management Roll-out
Slide No. 15-25
Appendix – Core Business Highlights
Slide No. 26 onwards
3
GPL: Among India’s Leading EPC Companies
One of India’s leading construction and infrastructure companies with dedicated focus on
asset-light EPC work
5 decades of experience in execution of major civil works, diversified across geographies &
infrastructure segments
o Pan India operations spread across 19 states o Transportation, Waterworks & Industrial construction projects o Marquee client list: NHAI, KNNL, PWD (Mizoram), BSRDC, CIDCO (Maharashtra) etc.
Strong Execution track record
o o o
Completed more than 6,850 lane km of road construction over the last 25 years Completed ~40 projects aggregating to INR 90 billion+ value in last 5 years Own extensive fleet of more than 2,300 pieces of construction equipment
Leading technology-led transformation in Indian construction space
o o
Technology-driven efficient execution: IOT, Computer vision, UAVs, cloud-computing Real-time reporting, higher transparency & faster execution using end-to-end digital project management
High medium term revenue growth visibility driven by large order wins
o o
Order book of INR 173 bn + Recent order wins in Q3 of INR 23.7+ bn Book-to-Bill of 5.3x: high growth visibility for next 4-5 years
Re-focused business on “Asset-Light” Model over last 4 years
o o
o
Reduced, restructured, monetized exposure to Asset Development Business Significant improvement in balance-sheet leverage (2.4x to 1.35x in last 4 years) and return ratios (FY2018 RoE exceeded 20% for the first time in 10 years) On track for mid 20s RoE & RoCE, strong cash-flow generation and D/E below 0.5x in next 2-3 years
Business Segments
Core Business - EPC (Order Book: INR 173 Bn+)
Transportation National and State Highways
Water Works Canals, Dams, supply & Dist.
Mining U/G Mechanised
Railways DFC
Industrial Steel & Power Plants, T&D, Conveyor
Other Civil Site Levelling, Bldg EPC
Asset Development
Power (GEVL) 4,300 MW Power Capacity– Stake in SEIL
Highways 4 Annuity + 3 Toll national & state highways
DRHP filed by SEIL for IPO
Demerged into a separate entity; Listed on BSE & NSE
4
4
Stable Performance With Strong Order Inflows
GPL’s 9M FY19 Highlights
New Order Wins Year to Date : INR 78 bn
Surpassed full year guidance
Growing and De-Risked Order Book (INR Bn) GPL’s Growth in EPC order book over the last 5 years
170
173
129
132
9M FY19 Revenue: INR 23.1 bn
EBITDA Margin: 16.5%
9M FY19 EBITDA: INR 3.8 Bn
9M FY19 PAT: INR 1,186 Mn
16.8% Y-o-Y Growth
In line with guidance
92
48
FY15
FY16
FY17
FY18
H1FY19
Q3FY19
RECENT ORDER WINS
22% Y-o-Y Growth
INR Mn Details
State
13,120 Nagpur – Mumbai Expressway
Maharashtra
Q3 EPS of INR 2.5/share*
1,625 Removal of LBCM
Andhra Pradesh
Book to Bill
5.3x
*Co Moved from -4% to +15% tax rate leading to 3% YoY PAT growth
4,930
Tunnel at Khambataki Ghat
Maharashtra
1,270
Kadirganj – Dewangarh Section
1,513 Dewangarh – Badaldih Section
1,257 Badaldih – Khaira Section
Bihar
Bihar
Bihar
5
Q3FY19 – Stable Operating Performance
Revenue (INR Mn)
9,039
8,779
EBITDA (INR Mn) & EBITDA Margin
15.7% 1,416
16.0% 1,404
Q3FY18
Q3FY19
Q3FY18
Q3FY19
PBT (INR Mn)
629
608
PAT (INR Mn)
479
465
Q3FY19 Highlights
Revenues remained flat due to delays in irrigation order commencement in Pradesh, Telangana resulting in reduction of short-term guidance, specifically over the next 12 months.
Andhra
&
EBITDA Margin in line with guidance at 16%+; Margin improvement of 30 bps YoY led by higher efficiency & digital project management.
PAT growth muted due to tax breaks tapering break available from FY2020
Low tax
down.
Significant new order wins in Q3FY19: INR 23.7 Bn new orders
Q3FY18
Q3FY19
Q3FY18
Q3FY19
Order book of INR 173 Bn with book-
to-bill of 5.3x
6
Significant Reduction In Net Debt Despite Strong Revenue Growth – H1FY19
Net Debt/Equity (x)
2.38
2.06
2.51
Net Debt
18,612
17,399
1.52
1.35
16,337
17,016
16,124
FY15
FY16
FY17
FY18
H1FY19
FY15
FY16
FY17
FY18
H1FY19
Debt Maturity Profile (INR MN)
Working Capital Days*
1,820
1,715
1,723
87
72
66
2,772
129
114
FY19
FY20
FY21
FY22 & Beyond
FY15
FY16
FY17
FY18
H1FY19
*Working Capital Days = Trade Receivable + Inventory + Deposits with Contractees + Advance to Subcon/Suppliers – Trade Payables – Mobilisation Advance
7
Q3FY19 Snapshot
8
INR(cid:9)MnQ3FY19Q2FY19Q3FY18Revenue8,7796,1139,039Expenses7,3755,1327,623EBITDA1,4049811,416EBITDA(cid:9)Margin16.0%16.0%15.7%Depreciation166164129Finance(cid:9)Cost690670691Other(cid:9)Income481245PBT608158629PBT(cid:9)Margin6.9%2.6%7.0%Tax(cid:9)Expense129-45164PAT479(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)203(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)465(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)(cid:9)PAT(cid:9)Margin5.5%3.3%5.1%Basic(cid:9)EPS2.50.72.6 9MFY19 – Strong Financial Performance
INR Mn
Revenue
Expenses
EBITDA
EBITDA Margin
Depreciation
Finance Cost
Other Income
PBT
PBT Margin
Tax Expense
PAT
PAT Margin
9MFY19
23,120
19,305
3,815
16.5%
491
1,986
63
1,400
6.1%
213
1,186
5.1%
9MFY18
19,791
16,669
3,122
15.8%
391
1,756
132
1,107
5.6%
-47
1,153
5.8%
% Change (YoY)
17%
16%
22%
26%
13%
-52%
26%
3%
17.0%
9
Order Book : Segment wise and Geographic wise
West Bengal 1%
Uttar Pradesh 26%
Andhra Pradesh 12%
Bihar 4%
MINING, 3%
LAND DEVELOPMENT, …
RAILWAY, 2%
WATER GRID, 1%
Gujarat 3%
Jammu & Kashmir 8%
Jharkhand 2% Karnataka 4%
Madhya Pradesh 0%
Telangana 10%
Odisha 16%
Maharashtra 11%
Mizoram 2%
Nagaland 1%
IRRIGATION, 22%
ROAD, 69%
10
Top Work Orders – Status Update
Package
Purvanchal Expressway Package 1
Purvanchal Expressway Package 2
Nagpur - Mumbai Expressway
Jammu Ring Road
Angul - Sambalpur Road work
Bihar Road (Patna - Gaya)
Sultanpur - Varanasi Package 1
Sultanpur - Varanasi Package 2
Location
Eastern UP
Eastern UP
Shiridi
Jammu
Angul, Odisha
Patna, Bihar
Varanasi, UP
Varanasi, UP
GHAGHRA BRIDGE TO VARANASI Package 3
Varanasi, UP
GHAGHRA BRIDGE TO VARANASI Package 2
Varanasi, UP
Cuttack - Angul PKG 1
Cuttack - Angul PKG 2
Cuttak
Cuttak
GPL Contract Value
GPL Balance work as on 01.01.2019
1,483
1,276
1,312
1,339
1,255
971
986
806
785
741
583
529
1,480
1,263
1,312
1,231
1,021
643
461
393
371
245
569
516
All amounts in INR Cr
Mobilised on Site
Revenue Booking Start
Completion Date
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Q3 19, Marginal booking
Q3 19 , marginal booking
Q1 20 , work started
Q1 19
Q3 18
Q4 17
Q3 17
Q3 17
Q3 17
Q3 17
Q3 19
Q3 19
Q3 22
Q3 22
Q3 22
Q2 23
Q1 22
Q3 22
Q3 20
Q3 20
Q3 20
Q3 20
Q3 22
Q3 22
11
Top Work Orders – Status Update
Package
Hyderabad Elevated Corridor
Rajamunda - Barkote
Dimapur - Kohima Package 3
Hyderabad
Barkote, Orissa
Kempwad Lift Irrigation Scheme (Rs.1363.49 Cr.)
Karnataka
Chintalapudi PKG 1
Chintalapudi PKG 2
PLIS Package 18 (MEIL - HES JV)
Kaleswaram Project (Rs.1482.75 Cr.)
CIDCO Package 3
Iqubalgarh to Vadodara : 4744
TOP WORK ORDERS
PROPORTION OF TOTAL ORDER BOOK
Pattisema, AP
Jangannagudem AP
Jadcherla
Siddipeta
Navi Mumbai
Vadodara - Gujarat
Location
GPL Contract Value
GPL Balance work as on 01.01.2019
Mobilised on Site
Revenue Booking Start
Completion Date
All amounts in INR Cr
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
Yes
1Q 20, Slight Delay
Q4 19, Work started
Q4 16
Q2 18
Q3 19
Q3 19
Q2 21
Q1 21
Q2 20
Q4 20
Q2 21
Q2 21
Awaiting Appointed Date
Expecting Q3 22
Q1 20, Awaiting Appoint Date
Expecting Q3 22
Q2 18
Q4 18
Q1 20
Q1 22
425
394
340
990
989
683
700
600
699
427
425
394
191
736
815
519
700
600
400
410
18,269
14,695
81.6%
12
Strategic Priorities and Guidance: FY19
Strategic Priorities
Strong Order Inflows…
Maximise Free Cash Flows
Strengthen Asset Light Business Model
Operational efficiencies through Tech Interventions
13
o Avg. Annual New Order Intake of INR 60 bn+ o Book to Bill to be maintained in excess of
3.5x
…Translating into Stable Growth..
FY19 Guidance (INR Mn)
Revenues
35,000-36,000
EBITDA Margin
PAT Growth
16%+
15-20%
20%+ Revenue growth & High EBITDA margins to be maintained despite heightened volatility in operating environment
13
13
Key Investment Highlights
Strong presence in high growth construction sector
Healthy and diversified pure EPC un-executed order book with good revenue growth visibility
Highly efficient operations with strong execution capabilities
Balance-sheet improvement on track for industry leading metrics in next 3 years
Significant value unlocking through business restructuring
14
Digital Project Management Roll-out at GPL
End-to-end Digital Project Management
Weigh-bridges
Plants
Crushers
Dump Trucks
Heavy Machinery
• Reconciliation of Work Done vs. Costs
(Material and Machinery usage)
• Automated reports for easy monitoring
Material Tracking
Machinery Tracking
and management
IoT Plant Unit
IoT Vehicle Unit
• Custom notifications for smooth coordinating and communication
• Benefits to all departments
Project Reporting
Web / Mobile Apps
Insights
Angul Project – Case Study
167
Vehicles & Machines
6
5
162
Weigh bridges
Concrete Plants
Daily Project users
115
Downtime Logs
1,405
Equipment Requests
6,263
Concrete Requests
18,456
Work reports submitted
58,751
Material transactions
74,713
Machine hours tracked
1,70,983
Cubic meters of concrete produced & tracked
9,05,823
Kms travelled by vehicles & equipment
68,11,476
Liters of Diesel tracked
17
Insights, Reports & Notifications
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
•
•
•
Validate Hired Equipment Bills Debit Notes on diesel in real time Tentative expenses for repairs
• • • •
Validate Vendor payments Bulk Material Reconciliation and Stock Generate P&L immediately at the end of month Subcontractor debit notes for fuel issued and equipment used
•
• • •
•
Track Variation from Tender BOQ Qtys vs. Progress Validate Invoice vs. RFI Qtys Actual Work Done Vs Invoice raised Reconciliation of Concrete produced Vs Reported Subcontractor Bill creation made easy with detailed backup
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
19
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
•
Improves Equipment Utilization& Availability %
• Resource allocation between Projects • Monitor Maintenance Schedule to
increase performance
• Monitor Fuel filling rate to maintain
working capital Tentative spare requirement & cost
• • Validate Weighbridge Calibration • Real time information on Hired assets
Equipment Productivity
• • Asset Turnover Ratio in real time • Equipment Usage vs. work completed
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
20
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
• Compare Equipment performance
of different manufacturers
• Real time stock details • Monitor Fuel filling rate • Monitor Realtime receipt of material at site • Material allocation across projects • Weighbridge calibration anomalies protect from
vendor invoice qty discrepancies
•
Schedule procurement of long lead items based on progress
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
21
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
•
Equipment Utilization
• Reconciliation of Concrete, Bitumen, GSB,WMM w.r.t to Progress report
Instant MIS reports Track Variation from Tender BOQ
• Monitor progress vs. Schedule • • • Asking rate for work execution • • • Work done Vs Invoice
Electronic documentation of RFI Equipment Productivity
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
22
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
• Digital Backup for Claiming Idle charges
of equipment
• Backup for periodical
material receipts to claim Price Escalation
• Maintain Evidence of RoW issues • • Claim new Items not included in Tender
Track delays due to unforeseen conditions
Scope
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
23
Benefits of Digital Project Mgmt
Accounts
P&M
Purchase
PMC
Legal
Tender
• Compare Equipment productivities in different geographical and climatic conditions
• Deriving average Fuel norms of
•
equipment’s based on type of work Fuel Mileage can be considered separately for Loaded and empty trips
• Compare actual costs and inputs Tender vs. Actuals
IOT on Vehicle
Downtime logger
Equipment Request
IOT on Weighbridge
IOT on Plants
Fuel Logger
DPR
RFI
Equipment Monitoring
Material Monitoring
Progress Monitoring
24
PMC @ HQ
PMC Project Coordinator-1
Project-1
Project Coordinator-2
Project Coordinator-3
PMC Site Representative
Project-2
Project-3
Equipment Management
Material Management
Operation Management
Progress Monitoring
Attaching & Detaching Asset
Fuel logger
Material Request
Progress DPR
Own-P&M H.O Hire- P&M, Site Through ERP
Tagging IOT Device
Own- P&M, H.O Hire- P&M, Site
Device Maintenance
P&M Site, Einsite team
Store In charge
Quality In-charge
Planning In-charge
Weighbridge Operation
Equipment Request
Plant DPR
Store In charge
Construction In- charge
Plant In-charge
Concrete Production
Request for Inspection
Quality Incharge
Construction In-charge & Planning Incharge
25
Angul Project: Milestones
Based on Tare Weight Anomalies found, Calibration at 2 Weighbridges is corrected Equipment Odometer which are not working highlighted and were repaired Qtys used in Diversion work and Indirect works are recorded Realtime concrete production information reduced communication issues Increased transparency in operations Concrete production against BOQ is recorded with Material Request Progress details at finger tips Found Scope variation Earthwork BOQ’s Miscellaneous categories in Fuel issues are restricted to 4 to monitor effectively
Implemented DPR Module with Sophisticated work codes
At Weighbridge replaced PC with Embedded IOT device
Implemented
o
o
o
o
Fuel Logger Equip Req Downtime logger RFI Module
Schwing Stetter B/P Telemetry Integration
VMU Upgraded to have backlog & Inertial data Devices on Hired Equipment’s
Integration of GPL legacy ERP with EINSITE o Workorders o Material Codes
o
Fuel logs
o Weighbridge logs o DPR Details
Replaced Paper
reporting Instant reports Transparency in Operations Real Time Monitoring Insights Alerts
26
Appendix
Robust NHAI Bid Pipeline with Majority EPC Orders
Significant Traction in NHAI Ordering
Significant NHAI Bid Pipeline of INR 864 Bn
HAM, 344
INR 380 Bn
Highway Projects Awarded in H1FY19
28%
EPC, 520
Share of AP & Maharashtra in September 2018 Tenders
NHAI Stepping up EPC Project Awards
NHAI expected to award more road projects under the EPC mode in FY19, largely due to:
o Lack of investments from road developers under HAM
Awards Coming in GPL’s Sectoral and Geographical Strongholds
Recent Project Awards
Thermal Power 1%
Real Estate 6%
Others 33%
Roadway s 35%
Hospitals 3%
Power T&D 5% Railways 9%
Others 7%
Water Supply 9%
Irrigation 10%
Communi ty Services* 16%
Gayatri Strongholds
Haryana 3%
Bihar 4%
Gujarat 4%
Mahara shtra 12%
Madhya Pradesh 12%
Tamil Nadu 5%
Uttar Pradesh 4%
Odisha 7%
Andhra Pradesh 16%
Highway project awards target set at 8,000km in FY19:
+8.2% yoy by NHAI
model
Highway projects completion target set at 16km/day in
o Lack of funding from banks under HAM model
FY19, +50% yoy by NHAI
28
Strategy – Focusing on ‘Asset Light’ EPC segment
Asset light EPC model o Pure EPC company with no asset-heavy
BOT or HAM project work.
o Diversified
across
geographies
and
practice areas o Deleveraging
and monetizing non-core assets to improve visible Return on Capital
balance-sheet
o Focused on cash flow generation
Explore new opportunities in EPC
o Further enhance engineering capabilities in order to pursue new EPC contracts
o Enter
specialized
sectors with
low
competition and high margins
o Opportunity
underground includes mining, water supply, lift-irrigation, high speed railways, urban infrastructure, pre- fab buildings etc
29
Grow presence in core EPC segments o Actively bid for quality projects in core irrigation,
roads,
areas of expertise- industrials
o Maintain a healthy book-to-bill ratio o Adhere to geographical cluster approach while bidding for projects to optimize management & equipment utilization and maximize profitability
Focus on driving operational performance & execution efficiency o Integrate best practices from different sectors to improve performance and project execution
o Utilize advanced technologies, designs, engineering and project management tools in order to increase productivity o Strengthen IT systems and other internal processes to reduce manual intervention
29
Spotlight on Asset-Light Model
2012-2015 : GPL numbers depressed due to asset
investments
2016 onwards: Business restructuring and Shift towards
Asset-Light model
Core Construction Services business is a high ROCE business;
At the bottom of cycle generated 18.2%
In line with the Industry practice, Free cash flow from Core
Construction activities was used for funding asset acquisition prior to 2016
Historical ROE and ROCE
ROCE - Core Construction Business
ROE
ROCE
20.20% 19.10%
13.70% 12.70% 10.80% 11.19%
12.50%
7.40%
8.30% 9.00% 7.70%
3.30%
20.20%
15.20%
10.80% 8.90%
2011
2012
2013
2014
2015
2016
2017
2018
33.60%
23.80% 25.10%
25.30%
18.40% 20.20%
25.90%
18.20%
* Core construction business ROCE calculated after deducting investment in power
and road BOT assets from the total capital employed
2011
2012
2013
2014
2015
2016
2017
2018
30
30
Strong Execution Capabilities & a Diverse Range of Projects
Projects executed in last 5 years
Segment
Roads Industrial Irrigation Site leveling Dams & reservoirs Railways Total
No. of projects executed
Value of contract (INR Mn)
12 17 5 2 2 1 39
57,262 23,535 3,730 2,382 448 3,845 91,202
Strong BG limits key competitive advantage Company’s existing BG limit provides additional o Company has existing BG limit of INR 37 bn advantage to expand order book & scope for further o Existing BG limit provides ability to maintain order book of growth
over INR 200 bn
o Ability to further increase the BG limits
Roads: Peak executed capacity at ~1,000 kms for the year 2007
S M K E N A L
1200
1000
800
720
600
400
200
0
991
680
553
364
362
232
210
827
652
498
1999 2000 2001 2003 2005 2006 2007 2009 2011 2013 2016
Required Lane Kilometers to be executed (as order)
YEARS
~700 Lane Kms
Capacity to execute
1,100 – 1,200 Lane kms/ year
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Balance Sheet
All figures in INR Million
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ASSETS (INR Mn)H1 FY19March FY18March FY17EQUITY AND LIABILITIES (INR Mn)H1 FY19March FY18March FY17EQUITYNON-CURRENT ASSETS(a) Equity Share capital 374 374 355 (a) Property Plant & Equipment 3,260 3,350 3,093 (b) Other Equity 11,565 10,856 7,056 (b) Capital Work in Progress 1 - 241 (c) Financial AssetsLIABILITIES(i) Investments 10,154 10,169 10,561 Non-Current Liabilities(ii) Loans 3,562 3,563 5,102 (a) Financial Liabilities(i) Borrowings 7,282 8,032 9,678 CURRENT ASSETS(ii) Other Financial liabilities 14,192 10,332 9,239 (a) Inventories 3,739 2,930 3,601 (b) Provisions 56 52 98 (b) Financial Assets(c) Deferred Tax Liabilities (net) 42 71 232 (i) Trade receivables 13,447 11,337 7,546 (ii) Cash and cash equivalents 666 569 378 Current Liabilities(iii) Other Bank Balances 1,870 1,857 1,593 (a) Financial Liabilities(iv) Loans 1,882 1,703 2,016 (i) Borrowings 9,528 9,591 9,596 (c) Current Tax Assets (Net) 1,076 1,385 407 (ii) Trade payables 7,624 8,043 6,608 (d) Other Current Assets 13,441 12,998 10,243 (iii) Other Financial Liabilities 2,054 2,042 1,489 (h) Other Current Liabilities 358 446 431 (c) Provisions 21 21 1 TOTAL 53,096 49,861 44,781 TOTAL 53,096 49,861 44,781 Board of Directors
T. Indira Subbarami Reddy
Promoter and Non-Executive Chairperson, over 25 years of experience in the construction industry
T. V. Sandeep Kumar Reddy
Promoter and Managing Director, 20+ years of construction experience
J Brij Mohan Reddy
Dr. V L Moorthy
Executive Vice Chairman, Over 49 years of experience in Heavy Engineering Construction and the harbour engineering industries
Non-Executive and Independent Director, 42 years of experience in paper and pulp industry
G. Siva Kumar Reddy
Non-Executive and Independent Director, Over 28 years of relevant experience
Mr Birendra Kumar
Non-Executive and Nominee Director (Bank of Baroda)
Mr. J.N.Karamchetti,
Mr. Ch. Hari Vittal Rao
Non-Executive and Independent Director, rich experience in the field of engineering and steel
Non-Executive and Independent Director, 49 years of experience as a banker and was employed with Bank of Baroda and Naandi Foundation in the past
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Management Team - HQ
T Sandeep Reddy Managing Director Masters in Construction Engineering & Management
from University of Michigan, USA 20+ years of construction experience
J Brij Mohan Reddy Executive Vice Chairman Graduate in Industrial Engineering from Berkeley
University, USA
50 years of experience in construction and
engineering
P Sreedhar Babu Chief Finance Officer Fellow Member of Institute of Chartered
Accountants of India
18+ years of experience in finance and banking
D Sitaram President, Business Development In-charge of evaluating new business units,
identifying suitable Joint-Venture partners, and attending review meetings with clients and regulatory bodies
T Rajiv Reddy Vice President In-charge of overall Project Controls & Monitoring,
and head of Mining business unit
Graduate in Industrial Engineering from University of
Illinois, Urbana-Champaign, USA
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Management Team - Projects
K Sesha Reddy Senior Vice President, Transportation In-charge of project monitoring and controls Previously a Project Head at L&T Masters in Construction management from Birla
Institute of Technology
32+ years of experience in infrastructure
G Venkateshwar Rao Senior Vice President, Irrigation Oversees entire irrigation business unit Graduate in Civil Engineering 20+ years of experience in irrigation EPC
MV Suresh Vice President, Roads Oversees road construction projects Graduate in Civil Engineering 20+ years of experience in EPC
CH Ramakrishna Rao Senior Vice President, Roads Oversees road construction projects Masters in Construction management from Birla
Institute of Technology
20+ years of experience in infrastructure
Sudhakar Lolla Vice President, Mining Oversees underground mining projects Masters in Technology and Mining from Indian
School of Mines
18+ years of experience in mining
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Contact Details
V V Chandra Sekhar Gayatri Projects Limited Tel: +91 40 23310330/23314284/4296 Email: vvcs@gayatri.co.in
Sheetal Khanduja Go India Advisors +91 9769364166 sheetal@goindiaadvisors.com
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