Dilip Buildcon (DBL) stuck to its full-year guidance after a seasonally week tepid second quarter in which net profit fell 30.7% year-on-year (y-o-y) to Rs 80.20 crore and revenue dipped marginally by 3.3% y-o-y to Rs 1,636.50 crore.
However, Rohan Suryavanshi, head, strategy and planning, DBL, told FE the company is on track to deliver on its guidance of Rs 10,000 crore in annual revenue this year. He said, “Historically, we book 40% of our revenue in the first half, which we have done this year as well, and the remaining in the second half. We will book about Rs 6,000 crore of revenue by March 2019,” he said.
Profit was impacted by the rollback of tax benefits that were earlier given to infrastructure assets under Section 80-IA as per the Income Tax Act, 1961. The impact of this would continue to be felt in the coming quarters, Suryavanshi said.
Earnings before interest, tax, depreciation and amortisation (ebitda) was up 2.1% at Rs 294.30 crore while ebitda margins contracted 22 basis points to 18%.
Of the twelve road projects under the hybrid annuity model (HAM), DBL has achieved financial closure for eight projects while three have received in-principle approval and one more is likely to be closed shortly.
Analysts said the National Highways Authority of India (NHAI) would pay out a mobilisation advance for each of these recently secured orders, which would, in turn, help the company to reduce its debt levels incurred on account of these projects. The company’s debt increased to about Rs 3,000 crore from Rs 2,563 crore at the end of FY17 with the net debt to equity at 1.1.
Suryavanshi added the company is diversifying into the mining sector and the contribution to its total order book from the segment is expected to grow from about 11% at present to about 15% in a year’s time. DBL’s current order book stands at Rs 23,935 crore.