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Analyst meet presentation

  1. 1. Vascon Engineers Limited Analyst Meet Presentation Q1 FY11
  2. 2. Agenda1. Economic overview2. Key financials3. Project details – EPC4. Project details – Real estate5. Acquisition6. Business positioning & Way forward 2
  3. 3. Indian economy continues to be on strong footing Strong GDP growth to continue Huge spending ahead in 9.20% infrastructure 145 # 8.50% GCF in Infrastructure 122 7.40% USD bn. 102 6.70% 85 71 59 FY 08 FY 09 FY 10 FY 11 E FY 10E FY 11E FY 12E FY 13E FY14E FY 15E # RBI est. for FY11 UBS Estimates FDI inflow getting stronger… …with significant investment in construction, housing and real estate sector Rs. bn. 2.21 Service 2.18 2.04 Sector 17% Construction 1.72 1.72 1.54 11% 1.21 Others 61% Housing/ Real Estate 11% Nov-09 Dec-09 Jan-10 Feb-10 Mar-10 Apr-10 May-10 Data for FY10 Total inflow of Rs. 25.9 bn. Source: Citi research/UBS 3
  4. 4. Factors contributing to infrastructure and real estate growth Strong FDI inflow Govt. focus on in real estate, infrastructure construction development segment Boost to infrastructure and real estate growth Easy availability of Growth in IT/ ITES housing loan and services affordable interest rates Infrastructure and real estate to show strong growth going ahead. 4
  5. 5. Key financials
  6. 6. Key financials – Q1 FY11P & L (consolidated) Rs. in millionParticulars Q1 FY11 Q1 FY10 % GrowthTotal Income 2051.1 1407.0 2009-10 45.8%Gross Profit 449.1 288.04 VASCON 55.9%EBIDTA 266.8 221.5 20.5%Profit Before Tax 206.5 142.4 45.8%Profit After Tax 138.4 105.2 31.6%EPS (Rs.) - diluted 1.54 1.38 11.6% 6
  7. 7. Key financials – Q1 FY11 Key Ratios (consolidated) Particulars As on 30.06.10 As on 30.06.09 ROCE – annualised (%) 11.19 12.35 ROE – annualised (%) 12.23 14.19 Total Debt (Rs. million) 2,079.4 2,475.2 Net worth (Rs. million) 6,752.3 4,014.7 Debt: Equity ratio 0.31 0.62 7
  8. 8. EPC Business 8
  9. 9. EPC business – ongoing projects Significant ongoing projects Tamil Nadu State Assembly Complex (Block B), Chennai Ruby mill, Dadar, Mumbai HDIL commercial complex, Vidyavihar, Mumbai Neelkanth Palacia, mall & business centre, Mumbai Kondhwa Reality, Pune Savitribai Phule Shikshan Prasarak Mandal, Pandharpur North Town, Chennai Sinhagad Technical Education Society, Ambegaon, Pune Order book ~ Rs. 44,300 million Order backlog ~ Rs. 32,300 million 9
  10. 10. EPC business – new projects New projects bagged during Q1 FY11 Factory – Legrand, Nashik Pharma Plant - Gopaldas Visram, Mumbai Bharti Realty Ltd, Ludhiana (Commercial ) North Town, Chennai (Residential) Aamby Vally (villas), Lonavala (Residential) TATA Housing, Lonavala (Residential) Kondhwa Realty, Pune (Residential) SMCC-Yamazaki Mazak, Pune (Commercial)SMCC - Sumitomo Mitsui Construction Company Order value of ~ Rs. 2,990 million
  11. 11. EPC business – completed projects Project completed during Q1 FY11Multi Level Car Park - Delhi Airport Cipla - Indore SEZ  Contract value of ~ INR 2,480 mn.  Contract value of ~ INR 1,447 mn.  Construction tenure ~ 15 months  Construction tenure ~ 18 months  Total constructed area ~ 1.2 mn. sq ft  Total constructed area ~ 1.55 mn. sq ft. 11
  12. 12. Real estate Business 12
  13. 13. Real estate - land bank Chandigarh Dev. potential 0.3 million sq. ft. Ahmedabad Dev. potential 2.7 Nashik Dev. potential 1.7 Thane Dev. potential 19.0 Aurangabad Dev. potential 1.4 Pune Hyderabad Dev. potential 25.6 Dev. potential 0.6 Goa Coimbatore Dev. potential 0.6 Dev. potential 3.3 Belgaum Madhurai Dev. potential 0.2 Dev. potential 1.6 Total development potential ~ 56.8 million sq. ft. 13
  14. 14. Projects launched during the quarter 14
  15. 15. Forest County –phase I Forest County –Project phase IType ResidentialLocation PuneTotal saleable area(sq. ft.) 688,355Total area sold(sq. ft.) 575,680No. of buildings 9Total no. ofapartments 386 15
  16. 16. Willows – phase II Willows -Project phase IIType ResidentialLocation PuneTotal saleablearea (sq. ft.) 290,930Total area sold(sq. ft.) 49,960 4No. of buildings (Bld. D,E,F,G)Total no. ofapartments 126 Note : Bookings for bld. F & G is yet to be started. 16
  17. 17. Vista - phase IIProject Vista- phase IIType ResidentialLocation NashikTotal saleablearea (sq. ft.) 112,000Total area sold(sq. ft.) 43,700 4No. of buildings (Bld. F,G,H,I)Total no. ofapartments 112 Note : Bookings for bld. H & F is yet to be started. 17
  18. 18. Tulip-phase IProject Tulip -phase IType ResidentialLocation CoimbatoreTotal saleablearea (sq. ft.) 73,940Total area sold(sq. ft.) 73,940 2No. of buildings (Bld. A,B)Total no. ofapartments 48 18
  19. 19. Hotel projects Four Points Duet HotelProject Four Points (Duet) NovotelLocation Pune PuneNo. of keys 232 320 19
  20. 20. Projects completed during the quarter 20
  21. 21. Real estate business – completed projects Project completed during Q1 FY11 Willows - Project phase I Type Residential Location Pune Total saleable area (sq. ft.) 168,675 Total Area Sold (sq. ft.) 152,265 No. of buildings 3 Total no. of apartments 60 21
  22. 22. Forthcoming projects 22
  23. 23. Real estate business – forthcoming projects Projects to be launched in Q2 FY11 Windermere , Koregaon Park, Pune (5 acres, approx. 325,000 sq. ft. high-end residential project & 100,000 sq. ft. high-end commercial project) Nature Spring, Talegoan, Pune (Approx 57 acres mix development project). Xotech, Hinjewadi, Pune (2& 3 bhk) Rosebay, Hadapsar, Pune (2 & 3 bhk). Tulips - Ph 2, Coimbatore (2, 3, 3.5, 4 bhk) 23
  24. 24. Acquisition 24
  25. 25. Acquisition 90% of GMP Technical Solutions Pvt. Ltd at a cost of Rs 626 million Turnover of GMP in FY 2010 was Rs 1267 million and PAT Rs 217 millionGMP has 3 divisions:  Manufacturing: Clean rooms, office partitions, door sets, storage racks  BMS: Integrated business management services; US FDA compliant for pharma industry  QA Technical Services: Validation and certification of weights and measures Acquisition to yield economies of scale. Synergy to strengthen capability to offer turnkey solutions 25
  26. 26. Business positioning and Way forward 26
  27. 27. Synergizing EPC and Real estate business Benefits 1. Risk diversification 2. Better quality and faster execution 3. Capability of turnkey real estate projects 4. Faster reach to and understanding of new locations 5. EPC facilitates market intelligence gathering for real estate projects 6. Revenue-sharing model that cuts risks 27
  28. 28. Employees : Key strength to growth Total Income vis-a-vis Manpower Total Income No. of employees (Rs. million) 10000 1000 Together 8000 800 Everyone 6000 600 Achieves More 4000 400 2000 200 0 0 FY06 FY07 FY08 FY09 FY10 Total Income No. of employees
  29. 29. Awards during the quarterSuzlon One Earth Global headquarters executed by Vascon on its plot on a built-to-suit basis for Suzlon Rated Platinum by LEED, scoring 57 out of 58 points Rated 5-star by GRIHA Awarded as Best Corporate Building by AESA Makes optimum use of wind, rain and solar energy Acclaimed as “greenest corporate headquarters on earth” Construction completed on schedule in spite of overwhelming odds LEED—Leadership in Energy and Environment Design GRIHA—Green Rating for Inhabited Habitat Assessment AESA—Architects, Engineers and Surveyors’ Association 29
  30. 30. Way forward Leading Player in EPC, Real estate, Hospitality and Infrastructure Foray into Hospitality Ventured into Real estate Started as a EPC company 30
  31. 31. Disclaimer•This presentation and the accompanying slides (the “Presentation”), which have been prepared by Vascon Engineers Limited (the“Company”), have been prepared solely for information purposes and do not constitute any offer, recommendation or invitation to purchase orsubscribe for any securities, and shall not form the basis or be relied on in connection with any contract or binding commitment whatsoever.No offering of securities of the Company will be made except by means of a statutory offering document containing detailed information aboutthe Company.•This Presentation has been prepared by the Company based on information and data which the Company considers reliable, but the Companymakes no representation or warranty, express or implied, whatsoever, and no reliance shall be placed on, thetruth, accuracy, completeness, fairness and reasonableness of the contents of this Presentation. This Presentation may not be all inclusive andmay not contain all of the information that you may consider material. Any liability in respect of the contents of, or any omission from, thisPresentation is expressly excluded.•Certain matters discussed in this Presentation may contain statements regarding the Company’s market opportunity and business prospectsthat are individually and collectively forward-looking statements. Such forward-looking statements are not guarantees of future performanceand are subject to known and unknown risks, uncertainties and assumptions that are difficult to predict. These risks and uncertaintiesinclude, but are not limited to, the performance of the Indian economy and of the economies of various international markets, the performanceof the industry in India and world-wide, competition, the company’s ability to successfully implement its strategy, the Company’s future levelsof growth and expansion, technological implementation, changes and advancements, changes in revenue, income or cash flows, the Company’smarket preferences and its exposure to market risks, as well as other risks. The Company’s actual results, levels of activity, performance orachievements could differ materially and adversely from results expressed in or implied by this Presentation. The Company assumes noobligation to update any forward-looking information contained in this Presentation. Any forward looking statements and projections made bythird parties included in this Presentation are not adopted by the Company and the Company is not responsible for such third party statementsand projections.•No offering of the Company’s securities will be registered under the U.S. Securities Act of 1933, as amended (the “Securities Act”).Accordingly, unless an exemption from registration under the Securities Act is available, the Company’s securities may not beoffered, sold, resold, delivered or distributed, directly or indirectly, into the United States or to, or for the account or benefit of, any U.S. Person(as defined in regulation S under the Securities Act).•The distribution of this document in certain jurisdictions may be restricted by law and persons into whose possession this presentationcomes should inform themselves about and observe any such restrictions. 31