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business | IST

NCC bets on strong execution; expects orderbook to go upto Rs 7,500 crore in near-term

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NCC said that order execution has been strong in the first half of the financial year, adding that the company has bagged about Rs 5,300 crore worth of orders in the first six months. The company expects its orderbook to go upto Rs 7,500 crore in the near-term.

NCC is in focus after the company bagged new orders worth Rs 444 crores. These orders were across the water, environment and buildings division. YD Murthy, EVP-Finance, NCC, said, “The order execution has been strong in the first half of the financial year. The company has bagged about Rs 5,300 crore worth of orders in the first six months. We are confident of strong order accretion for the current fiscal, total orders on hand can go up to something like Rs 7500 crores in the near term.”
The NHAI brought about certain changes in their bidding eligibility criteria for their HAM projects. They are also trying to look at ways to monetize their current portfolio. There's a lot of progress that's been made on arbitral awards as well.
So when asked if they were satisfied with the pace of awards as well as sorting out disputes, Murthy said, “The hybrid annuity projects have picked up quite nicely, and NHAI is also participating in the PPP project and providing the necessary comfort to the developers. From the developers' point of view also, it is a far better model than plain BoT projects. So, we are all participating in hybrid annuity projects, and banks are also coming forward for providing the necessary capital and therefore financial closure is not a problem,” he added.
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“As far as arbitration awards are concerned, and based on the NITI Aayog circular when the arbitration award is given to the contractor,75 percent of the award amount is provided to the contractor by way of cash with a banker and security that is also helping us to improve our liquidity and our ability to manage things better. It is a step in the right direction,” said Murthy.
In the HAM bidding model, the criteria has been lowered, so smaller players can also enter, so when asked if they were happy with that or do they think that will clutter the landscape, he said, “All said and done, it is a development project. The developers will have the financial muscle to bring the money to the table and declare financial closure and they should be able to execute the project in time. So if that is not lost sight of, then some little bit of tinkering in terms of pre-qualification etc., should not be a problem, but the underlying principle is the financial strength of the developer to take up the projects. Suppose a smaller hybrid annuity project of Rs 500 or 600 crores is there then smaller players may find it much easier to participate and take the financial closure forward. So, from all these angles, other players can also participate and that should not be a problem as far as we are concerned,” he specified.
For the full interview, watch the video.