Man InfraConstruction Bullish On Projects Over Next Five Years

Man InfraConstruction Ltd. is bullish for the next five years and expects to reach new heights based on its portfolio of projects.

There is a lot of scope in the engineering, procurement and construction sector, Parag Shah, chairman emeritus of the company, told NDTV Profit.

The EPC contracting company focuses on the ports sector, among other areas, and also undertakes redevelopment projects. "At present, we are spread all over Mumbai—from Goregaon, Mira Road, Juhu, Vile Parle, Ghatkopar, Mulund, BKC, Bandra, Pali Hill for our redevelopment projects, among others," he said.

According to Shah, the company has plant, equipment, machines, manpower, liquidity in the bank, and has achieved financial closure. It has projects till FY29, which add up to almost Rs 2-2.5 crore sq. ft. jobs in hand, he said. "Currently, nothing is in the MoU stage, everything is in the execution stage."

It is constructing one of the tallest towers in the country, for which it has approval for 312 metres, and where work is under way, Shah said. The company is set to redevelop Virgo Co-Operative Housing Society in Bandra, Aamir Khan's residential plot, and luxurious residential projects in BKC's Kalanagar that will start in the next six months, with a work-time tenure of 2-2.5 years, Shah said.

"We work more on the DM model (development management model), where the top-line will not come in my books, but the bottom line comes in my books. Hence, it is very difficult to compare. So, I will request analysts and investors to not look at only the top-line. They would have to understand the bottom-line."

The total size of the Mira Road project is around 400 million sq. ft. and it is a revenue share model, he said. "We have not purchased the land. From the top-line, 25% we are sharing with the land owner, while 75% comes to us. When it comes to the Goregaon project, where we are one-third partner, it is a 24-acre land and approval and everything else has started."

Their project in Juhu is near completion, he said. "In June-July, we will be able to give the OC and possession to our customers. It is a redevelopment project and we are a 70% partner. In the (Vile) Parle project, the total construction is around 15 lakh sq. ft., but on a 5 lakh sq. ft. of saleable area, our DM fee is 14%."

The Pali Hill project, which again involves redevelopment, is a joint venture between three developers.

"Kala Nagar project is a luxurious project where we estimate around Rs 75,000-80,000 sq. ft. output. The Tardeo project is again a DM model, where my top-line and bottom-line will remain the same. We just started the projects 2-2.5 months back and have already sold around 15% of the flats, even in the tallest building," Shah said.

It is set to announce another luxury project on Jan. 18, which will come up in Ghatkopar.

Man InfraConstruction is a zero-debt company, he said. "The debt that you are seeing on books is the partner's contribution. Whenever we do a joint venture, we always keep less capital and partners bring money of their portions as a loan. That's actually the financial model."

Referring to the Rs 100-crore Induslnd Bank Ltd. loan, he said that it is a construction finance approval taken by the company. "But against that, we are sitting on a cash liquidity of Rs 400 crore and we don't see that we would need any of that in the next two years' time."

Shah is also bullish on port sector development. "I strongly believe that the infrastructure work will see threefold growth in the next 2-3 years' time," he said.