Pipavav Shipyard has recently floated IPO and while talking on the listing, Pipavav Shipyard's Chairman Mr Nikhil Gandhi said the company is in the process of putting bids for defense and oil and gas projects.
The company, he said, had put tenders worth INR 7,500 crore for defense projects. Gandhi added that he saw FY10 revenues at INR 800 crores to INR 1,000 crores.
Q - We heard yesterday about the two large deals that you were in conversations with, with naval forces both in Oman and in India- what are the chances at this point that they fructify and what would that mean to your order book?
A - It is always our endeavor to put in the best possible bids which would satisfy the clients and also make sure that our EBITDA margin is not compromised. Having build world-class infrastructure, we will have slight upper hand over several other international companies of our stature and size. I believe that Pipavav has good chance to put in competitive bids.
Q - Which ones do you think have higher chances of coming through because the Oman orders totally the bids are about USD 4 million and the Indian naval order is about 1.3? These are the kind of orders that investors would like you to book now from the naval and the defense side, which do you think you have a better shot at?
A - We are the first company in the private sector approved by the Oman Ministry of Defense. They have looked at our facilities and this is a world class infrastructure, and hopefully, they may want to use these facilities and that is one of the reasons they have approved our company. So we are very positive about these developments. And it's a nice situation to be in on the first day to be starting business with some of the top Indian entities like Navy and Coast Guard. Royal Navy in the Oman has also approved us as a warship builder, primarily, because of experience of our partner Punj Lloyd and the infrastructure that we have build here, would perhaps be a point which might tilt the decision in our favor.
Q - You will be more at liberty now to talk about growth as you see it, not so much for FY10 what kind of target can you hold out for FY11 and FY12 now to your investors?
A - First and foremost we are right now in the receipt of extremely large tender from both national and international defense agencies. We are in the process of putting in the tenders together. We have already put in worth about INR 7,500 crore plus to the Indian Naval authorities. We are in the process of putting in rest of the bids to the different potential client both in oil and gas sector, defense sector and international potential customers.
Since we have built first of its kind in the country, a most modern state of art engineering complex, fabrication complex and dry dock attached to it, people are not only excited about building their assets here. It is because of the kind of infrastructure we have set up for example loss of wastage of steel, etc. which will be very less compared to any other similar facilities in the country. We are quite upbeat about ramping up the revenues. The current year revenue is likely to be in the region of INR 800 crore to INR 1000 crore. The ramping-up would be pretty rapid because we do have the capacity and the potential clients want fast forward the deliveries of their requirements and there is a huge pent up demand in the country. I think we would be in for a significant excitement going forward.
(Sourced from CNBC TV 18)
