Man infra construction Con-call Notes
Business :
Man lnfraconstruction Limited, India’s premier integrated EPC player with almost 6 decades of experience in the construction industry and a decade in Real Estate development.
MICL Group has successfully completed approximately 7 ports across India, encompassing over 250 hectares of infrastructure works in the EPC segment.
Additionally, the Company has accomplished 13 real estate projects, all completed ahead of schedule, thus, underscoring its commitment to stringent timelines and elevating industry standards with some projects delivered at least a year ahead of the scheduled date.
The EPC division of the Company engaged in contracting for ports, infrastructure, government projects and owned residential ventures generates EPC margin or PMC income with a distinct emphasis on enhancing the bottom line.
Within real estate, the Company adheres to an asset-light strategy where it is involved in joint
Development Agreement (JDA) example ‘Aaradhya High Park’, which is at Mira Road or a Joint Venture, which is our ‘Atmosphere’ Project at Mulund, ‘Insignia’ project at Vile Parle or
Development & Marketing model which is at Tardeo, the project named ‘Aaradhya Avaan’.
Company business model in real estate :
Management Answer :we are always keen on a DM model or a JV model. It’s not a question of only investment,but when we enter into the DM model or a Joint Venture agreement with someone at that time normally some of the approvals has come up like the most of the 50%, 60% work has been completed. So, normally the developer acquire the land and when the construction starts it takes 2 to 2.5 years in a normal course whereas in this model you can start the work in next six to seven months’ time. That’s the primary reason. The secondary reason that the redevelopment of the building in a DM model or a JV model, your investment is reduced and your risk factor is also reduced. And till now, whatever the projects which are there in pipeline or whatever we are executing, the financial closure of all the projects has been done. In our books there are certain loans which you will be able to see, out of that it is actually not 100% loan. Out of that 50% amount is a contribution of the partners because in real estate Company, we always run a subsidiary companies and in subsidiary companies, partner’s contribution also comes in our balance sheet as a loan. So, actually we are having approximately Rs. 80 crore to Rs. 90 crore or not more than Rs. 100 crore loan as on today from all the bank’s loan. So, we are open to acquire the land also, it’s not like that we don’t want to acquire the land, but we are not in a hurry to acquire our land because with this 25% investment we have been able to make same amount of money. So, we have adopted that model.
Future Outlook
Epc Segment : Company have Approx 1265 order book.
Real estate : The company’s real estate portfolio is estimated to be around 4.6 million square feet, which comprise of around 2 million square feet of ongoing projects and 2.6 million square upcoming projects.
Debt Level : The company has reduced debt and improved liquidity, with a net cash positive position and liquidity of over Rs. 530 crore.
Discl : Invested.
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