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NCC Ltd is in parleys to divest stake in some real estate projects, including those in Bengaluru, Kakinada and Hyderabad, to fuel its business expansion plans.
While the company added orders worth ₹2,000 crore in the first quarter, it expects to see addition of new orders worth over ₹10,000 crore this fiscal and a topline growth of about 10 per cent.
Over the past 30 months, the Hyderabad-based infrastructure company has made significant progress monetising BOT assets which include Himachal Sorang hydel project, stake in coal-based thermal power project to Sembcorp and two road assets — Western UP and Bengaluru elevated tollway — thereby managing to slash significant portion of its debts.
In an effort to further consolidate its business, it is in talks with potential investors to dilute its stake in real estate projects once the market sentiment gets better. But the funds thus garnered would be used to meet its requirements for new projects.
YD Murthy, Executive Vice-President, Finance, NCC, told BusinessLine : “The company has a standalone debt of ₹1,577 crore. It has come down from ₹1,884 crore. The loans and advances to group companies have come down to ₹558 crore as against ₹1,122 crore and investments in the group companies are at about ₹1,028.7 crore.”
Murthy said, “The focus now is on bringing down exposure in real estate subsidiaries and NCC Urban. The company is in the process of divesting stake of up to 50 per cent of the land in favour of private investors in the real estate segment. Discussions are on to close the deals.”
Recently, during and analyst conference, Murthy explained the company expects to garner about ₹135 crore by sale of land in Bengaluru to metro project there and another land parcel in Kakinada, both part of subsidiary NCC Urban.
Of the ₹1,587-crore debt, the company, through NCC Urban, has ₹400-crore debt. Other projects account for ₹600 crore and together it has exposure of ₹1,200 crore in debt and equity. The company closed the last fiscal with a turnover of ₹9,204 crore, and netted ₹31.68 crore. During the year, the company secured new orders worth ₹9,226 crore taking the order book up to ₹18,088 crore.
NCC shares closed at ₹91, up 1 per cent, on the BSE on Monday .
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