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India's Leading Infrastructur Companies 2013

 
 
 

 

India’s Leading Infrastructure Companies 2013’ featuring the leading players of the infrastructure sector is an attempt to highlight the role of infrastructure in the Indian economy by featuring and analyzing the performance of the leading infrastructure companies. The publication comprises four key sub-segments - construction, ports, power, and telecom. It profiles 148 companies of which 113 are in construction (including development of airports & seaports, industrial units, railways, SEZ, real estate, and social infrastructure), 20 in power, 4 in Ports and 11 in telecom services. Key highlights of the financial analysis are-

• Total income of construction companies registered slower growth of 4.9% in FY13 against 17.4% growth seen in FY12. Order inflows remained subdued due to delays in project execution resulting from delays in land acquisition and environmental clearance issues.

• Net profit for construction companies has declined 13.9% in FY13 compared with a 7.9% decline in FY12 whereas NPM has plunged from 7.2% in FY12 to 5.9% in FY13. This is partly attributed to the growth in interest expense of 23.6% in FY13 due to higher debt levels, which grew 9.8% in FY13.

• Total borrowings of construction companies grew 9.9% in FY13 vs. 19.6% in FY12; in order to fund capital expenditure and meet working capital requirements.Net worth grew 5.7% in FY13 vs. 7.8% in FY12. Debt to equity ratio thus increased to 0.79 times in FY13 from 0.76 times in FY12.

• Total income of power companies grew at a slower pace of 8.7% in FY13 vs. 17.7% in FY12, on the back of the various sector-specific issues such as deteriorating financial health of state distribution companies, issues related to PPAs, fuel shortages, delays in land acquisition, environmental clearances.

• Debt-Equity ratio for power companies has grown from 1.01 times in FY12 to 1.1 times in FY13, as total borrowing grew 16.9% to finance 21.6% growth in gross fixed assets needed for capacity expansion.

The publication also consists of a quarterly analysis of the construction and power sectors–

• In Q1FY14, income of construction companies increased 0.5% compared with 12.8% growth in Q1FY13, over corresponding quarter of FY12. NPM dropped to 3.5% in Q1FY14 from 6.6% in Q1FY13 due to growth in salary and wages, interest expenses, and depreciation charges.

• In Q1FY14, income of the power companies witnessed decelerated growth of 1.9% as compared with 13% growth in Q1FY13, over corresponding quarter of the previous year. EBDIT margin grew from 32.5% in Q1FY13 to 37.1% in Q1FY14, mainly fuelled by 8.8% decline in raw material costs in Q1FY14.

• NPM of power companies remained stagnant at 12.8% in Q1FY14 compared with 13% in Q1FY13. Interest expense, depreciation charges, salaries and wages grew 34.3%, 23.6%, and 9% respectively in Q1FY14, over the corresponding quarter of previous year, which had an impact on NPM.

The publication also includes a special section on primary research analysis, capturing the trends, issues, growth opportunities in the industry. A summary of the key points is as given below:

• Nearly 50% of the respondents feel that improvement in quality of infrastructure is one of the major changes required to boost India’s appeal as a key investment hub.

• Project delays and cost overruns emerged as the most significant challenge for 47% of the respondents.

• Nearly 44% of the respondents in the survey concurred on the need for investments, especially in large infrastructure projects.

• Nearly 36% of our respondents highlighted the need for appropriate tax incentives to push private investment growth in the infrastructure sector.

D&B India is confident that ‘India’s Leading Infrastructure Companies 2013’ will provide the right platform for the profiled companies that are playing a key role in transforming the infrastructure sector. D&B India will track this transformation and capture the pulse of this critical industry through future editions of this publication.

Sujoy Kumar Chakraborty
Leader – Operations
Economic Analysis Group & New Product Group
Dun & Bradstreet India