NCC Ref. No.: NCCL/ 2016 Date : 17-08-2016 The Secretary ‘The Secretary National Stock Exchange of india Ltd BSE Limited, 5" Floor, Exchange Plaza Rotunda Building, PJ Towers Bandra — Kurla Complex Dalal Street, Fort Bandra (E) MUMBAI~400003. MUMBAI - 500 051. Dear Sir(s), Scrip Code : NSE: NCC & BSE : 500294 Sub: Transcript of the conference call. Please find enclosed herewith the transcript of the conference call that took place on 12” August, 2016 for discussing about the Q1 and FY 2016-17 results of the Company. Kindly take the above information on record. Thanking you, Yours faithfully For NCC LIMITED. MV Srinivasa Murthy Company Secretary & EVP (Legal) Enel: As above NCC Limited NCE House, Madhapur, Hyderabad 500.08], T +91 a0 2325 F 491.40 22129855 ited. comNCC NCC Limited “Nagarjuna Construction Company Limited QI FY2017 Results Conference Call” August 12, 2016 NCC sesamin > NCC Limited investments Re-defined ANALYST: MR. JASPREET SINGH ARORA - SYSTEMATIX SHARES & Stocks LIMITED MANAGEMENT: MR. Y. D. MurtHy - NCC Limirep Mr. R.S RAJU - NCC Limitep Page 1 of 17NCC NCC Limited Moderator: aspreet Singh Arora: Nagarjuna Construction Company Limited August 12, 2016 Ladies and gentlemen good! day and eleome to the NCC Limited QU FY2017 Results Conference Call hosted by Systematiy Shares and Stock Limit, As a reminder all Participant lines wil be in the listen-omly mode and there willbe an oppartunity for you to ask questions after the presentation concluces, Should you need assistanoe during this ‘conference please signal an operator by pressing” and then “0” an your fouchtone phone. Please note that this conference is being recorded. I would like to hand the conference over to Mr laspreet Singh Arora from Systematiy Shares & Stocks Limited, Thank you and over to you Sit Govsd evening to everyone and welcome to the QF earnings cal for Nagarjuna, We have From the management Me. Murthy snd his team. Over ta you Sit Gov attemoon,Jaspreet an thanks for dhe inexdustion, am Y.D. Murthy fom NCC and also my colleague, Me. RLS Raju here. We will briefly tell you about de frst quarter results flowed by a question and ansover session, Inthe First quarter we had done a topline of 1929.7 Crores as compared 9 1775 Cranes in the previous year, The fist quarter topline growth is about 8.7%, EBITDA is about 165.7 (Crores and net prot is $2.3 Crones as compared to EBLTDA of 158.3 Crores and net prt (of 414 Crores in the first quarter of previous year ‘Thee not peoic s improves by about 264%, We have reported an EPS oF 94 psa in the Hrs ‘quarter as compared 4 0.75 paisa inthe Fist quarter ofthe previous year, We have bagged 3620 Crores o fesh orders and onder book is at 1945 Crores ‘Now L will give you the composition ofthe order book. Inde frst quarer we have received 3620 Crores of fresh orders and in that the share of buildings and roads is about 1110 Crores, water & envionment and railways is about S85 Crowes, electricity is S48 Croce, lergation is 1378 Crores, total is 3620, Inthe Fest quarter the execution is ahout 2230 (Crores inclding the international projects und we decrease it by buildings and roads 1042 ‘Crores, water, environmental and eaihways 543 Crowes, eleeieal 138 Crores, ization 74 Crores, metals 14 Crores, power 77 Crores, and incemational 342 Crones. Total execution ‘including international is 2330 Crores. The onler book at the end of the quarter as on June 30, 2016 fs F945 Crores that is improvement of nearly 1400 Crores compared tothe beginning of the year that is a good ‘improvement and the order book balance at the end of the frst quarter is buildings $443 Crores, water and railways 4931 Crowes, electrical 1324 Crores, irigation 2188 Crores, metals 40 Crores, power 184 Crores, mining 23 Crores international 1912 Crores Page 2 of 17NCC NCC Limited Moderator Indeajeet Singh YD. Murhy: Nagarjuna Construction Company Limited August 12, 2016 The debt level of dhe company atthe end of the frst quarter is 1881.7 Crores, not much change, a ceduetion of about 2 Crores compared to March 31, 2016, The composition of the Akebt is cash credit and working capital 1720 Ceores, long-term foans from the banking system L48 Crores, machinery loans about 13.6 Crores. Because ofthe Ind-AS and also the guidelines given by SEB in the fist quarter we have done only the standalone financials, so our comments will be estricted to standalone and we have not done any consolidation forthe frst quater. ‘These are the basic comments fam the management. Now We request the partcipanis to ask their questions and also raguest eich participant not fo ask mare than te questions and we wud ike to close the eanference witha maximum of about 20 questions. Thank you very much, We will now begin dhe question and answer session, We have the Fist question thom the line of Indrajext Singh of Macquarie, Please zo ahead, Mr. Murthy and Mr. Raju thanks for the opportunity: My Fist question fs 9 dhe interest cost think much ofthe destine inthe cost has kind of played ut inthis quarter, ean you kind of just tatk us through ovhat exactly is the new cost of borrowing that we are kind of paying, whic: al Taviftes have seen dhat and have you also scen a cut in the Fes changes that we were paying to the banks especially fr hank guarantess and those kinds of things? ‘Yes, i fact, there has been a substantial improvement on the Finance cost in the Hist ‘quarter, but itis in Hine with our expectations, You should go back a fit: fac you will see in FY 2015 the share of finance cost as compared to the turnover is about 7%, E2016 last year it was about 6%, Inthe current year ist quarter it is abowt S% and weare confident we will be able to maintain Hat. A vatiaty of reasons are there, Actually the corporate loan, we have retailed to the banking system of about 152 Crores. The eurent fourstanding is only 148 Crores. Tht isa high cost debt carrying interest of sbout 13.5% and the reduction in the debt has helpal us to improve on the inierest eost for that quarter and likewise the uilization oF init also seas somewhat restricted so thatthe debt levels were ‘much below 2000 Crores that use helped usin tems of registering the interest hurden. A breakup of the finance cast, J will give you, intrest on debentures is nil in this quarter, ty 5.9 Crores as compared 11,7 Crores in the first quarter of the previous year The major component is interest on cash pid in working capital for the ccurent quarter it i 58.5 Crores as compared 0 64.6 Crores in the frst quarter of the previous year. Likewise, the interest on mobilization advances also has come down, Is 66 (Crores in this quarter as compared to 14.8 Crores inthe previous year. On the interest on thers is basicaly imerest on creditors given by us the LC bills the interest that we bear, Page 3 of 17NCC NCC Limited Indrajeet Singh YD. Murthy: RS Raju Y.D. Morthy: Nagarjuna Construction Company Limited August 12, 2016 last year it was {3.3 Crores and this year it is oly 4.3 Crores, BE commission and LC ‘commission are more oss in Tine with what was lst year mainly because tis utilization also has increased because we are geting more orders. The fiance cost is resonable, but actually what happens i the sanctions and dishursals and also charging ofthe upfront foe and processing charges i likely co Kick in the sevand and thitd quarters of the current yea. That is why it is looking a lie Hes but neverthefess the finance costs have shown good ‘improvement compared the previous quarter of the last yeas Thank you. My second! question is can you just tlk theough anymore kind of debt reduction, which can happen and slo in the context that what kind of revenue growth that Weare looking at and would that led to our working capital agin kind of inereasing at this point of time? Me. Raju will answer. Here what happens is basing on she moveration of the assets are taking place by the company. and already some dxbt reduction has happened and some more debt reduction possibilities are also there, but in the sare time, the recent orders for whatever orders we are booking and also whatever orders are coming in same of the veders are not having the mobilization advance pereents ‘0 what orders we seoured in the fist quarter and also in ‘he previous quarter last quarter, the value of the orders were mobilization advanee has been nvarly 4000 10 S000 Crores are there. So such orders require Some additional working capital tor ineluding those works, so thereby the more working capital requirement is there and already we pumped some amount towards working on some of the projests, So ‘otherwise there is every possibility to reduce whatever isthe dab and a this moment hove Far we ate able to saduce Further is fo be Seen, So once those prujects are taken off and those Projects star giving return something and at chat ime there is @ possibilty of again reducing further debt of 20K) Crores but the target of the company to raluce about 200) ‘Crores debt in the current year to bring down to 100 Crores, Absoluely, the evrporate Toan | was talking about the current outsanding i aboot 148 Crores, we ate definitely planning to pay it before March 31, 2017, So to tht extent that debt level will come down and because iC a high cost debt it is good foe us. but atthe same time because theres going to bea working capital gap because we nearly 400 10 5100 Crores of oeders we received without mobilization advance we are acwally talking the hanks for funding these projets tht in view of the mobilization advance. So we debt levels may look a litle very high up. but nevertheless we do not sant © see 2 situation where liquidity becomes dificult preposition, So there isa game plan, soe will see how i will Page 4 of 17NCC NCC Limited Indrajoct Singh: Y.D. Murthy: Indrajeet Singh Moderator: Vibor Singhat: YD. Murthy: Vibhor Singhat Y.D. Murthy: RS Raju ‘Nagarjuna Construction Company Limited August 12, 2016 Just one Fllowup. The orders that you mentioned which are coming without mobilization advance, should it be safe to assume that they would then earry margins whieh cowld be loser to 10% 10 119%? ‘Yes, they are coming up with better margins when mobilization advance is not thers, but t0 soo that our liquidity position continues to be comfortable we are likely co tatk (0 the banking system and i they are comfortable in view of the mobilization advance, we tke the loans from the banks. From the clients also when you fake mebilization advance, you are paying some interest. Banks also would pay’ some interest, There is @ game pan with that so that we do moe want to compromise on the liguiiy Thanks To Thank you. We have the next question trom the line of Vibhor Singhal of Phillip Capital Please go she Good evening Sit, Thanks For taking my question. Congratulations 60 & very good set of numbers, Sir, just a couple of questions: one is I wanted to understand on the margins Fraat ‘in this quarter if you look atthe margins at 8.7% but there is 13 Crores of other operating income so excluding tha the margins afe around 8.2%, So just wanted fo get into wat exactly was the nature of this 1 Crones of other operating income and also with $2 margins in te first quarter will we be able to do 9% to 9.5% margins that we have suid For the fall year? Yes, nthe fest quarter compared fo the corresponding quarer of the previous year the EBITDA margins dere is slight decline is there and ping forward we expect thatthe EBITDA margins the company is able to matatuin 9.2% or plus, So because of the mix of the projets what happemad in the frst quarer and some of the projects where repeated ‘contracts, sich ar in the last phase, snd parting some way of variations and other tings hereby EBITDA would be 8.28% and likely to reach 9 1 decline happened at the EBITDA level. Going forward we are hoping thatthe So we maintain that we wall be able to 9.2% margins forthe fll year? Yes Last year 8.8% and his year we are confident 9.2% 10 9.3% we will be able to maintain dspite dhe aberration in the frst quater Page 5 of 17NCC NCC Limited ‘Vibhor Singhal: ¥.D. Murthy: Vibor Singhal: Y.D. Murthy: Vibhor Singhat: Y.0. Murthy: ‘Vibhor Singhal Y.p. Murthy: Vibhor Singhal Y.D. Murthy: Vibhor Singhat Y.D. Murthy: Nagarjuna Construction Company Limited August 12, 2016 [My nest question is what is the nature of the 11 Crores of ether operating income inthis «quarter? fs there some ral estate sales hat we have taken inthis quater? ‘Some real esate sales are there and some oxher hieing of equipment and those things are thre, [tis a mix oF wo to thee items Is ieikely 0 continue inthe next few quarter or itis just a kind ofa ome-ot?™ Ik would not he not that much level, slightly 4 19 $ Crores, 6 Crores claim would be there. Secondly fof those BOT projects. So have we received that money and if yes then how have we Sir on the BOT projects we were expecting some 200 Crores of eas on the sale utilize that cash? Western UP dhe money has been reovivad, but the money from the sale of Bangalore Railway Tollsay is yet to conte, Its likely to come in bette September and the Western LUP money is used for our working eapital And the Bangalore elevated money would also he used for working capital? Obviosty ‘We would be Fooking 10 reduce debt on that? “They are not yet come. We book it in our eash credits aecounts and then stant wing it (One lst question if can just squeeze in, do you expect any revision in the BG and LC charges, as you had mentioned in the last quarter that now that we have a much better balance sheet andl much Tower leverage, we would go back to banks for eduction in those ‘charges. is there any reduction in those charges expected over the year or whatever we had wwe have already received it ‘Yes absolutely. Actually we are having that dialogue with she rating agencies, They have taken up our proposal based on our audited balance sheet of FY2016, In fat they have come and met our top management also, Discessions have taken place, Most ikely they are taking tothe waiting committe in the next eva W sand most probubly by the end of this ‘month the revised rating is expected. Based on our improvement in fundamentals and our operations we are confident that we may get A category rating. Now we area BBB. That means 180 notehes, BBB+ and A-and if we go t0 A> that beneic is sill there, There could be guod improvement in the pricing of our financial produets particular LC, BG Page 6 of 17NCC NCC Limited ‘Vibhor Singhat VD. Murthy: Vibhor Singhat: .D. Murthy: Vibhor Singhal: Moderator: Nitin Arora: Y.D. Marthy: Nagarjuna Construction Company Limited August 12, 2016 commission and all, we ate expecting a reduction. Now we are enjoying 25% concession of the court rates and once the rating improves, it may go down to 50% reduction, So that will help as improve the financing cost, likewise, the working capital limits im the banking system ill definitely also be looked at with better pricing, Again there could be a improvement oF nearly 0.5% inthe intrest rates that we are paying tothe banks as of now So the category yoo mentioned we will be easily able 16 move fo A category from the ‘current category what would be the curtent category? Bs. So we expect we might be able jump wo notehes there? Yes. “Thanks ot for aking my questions Thank you, We have the next question from the fine of Nitin Arora of Aviva Life Insurance Please go ahead. 4st wo questions; number one, sith respect 10 your debt assumptions how do you see it with a 10% guidance of wpline we should end tha debt narsber atthe end oF this financial year, and you have been already told o8t in he eall that you know there sould be slight ‘increase in the imterest cost that think you are assuming on the basis of dhe revenve growth, So what kind of an interest cost you are assuming in forthe whole year, That isthe firse question, The second question i that with respect to your margins, can you tell us what ‘was the aewal quantum on the eqeipment sale and the realestate sole that was contributing to revenues and thats the ultimate eoribution on the EBITDA? Thank you. [About the topline we are targeting about 6% 10 10% growth and debe in our business pan itself, we plan to reduce the dest by 200 Croees from the opening balance, So there is a possibility to reduce the debt sinee our sroup company selling this BTL road projects and also whatever money we received at this moment, we purmped as working capital and with this quantum of sorking capital we may able t manage in this second, chird quarters ‘without any further working capital So there isa possibility to reduce the debt frm 150 ‘Crores 10-200 Crores by March 2017, More so 740 Crores also i. lump payment, whieh is also to rqpay before March 2017, So thereby every possibility there is trom 150 to 200 Crores on debt reduction in the parent company. As far as other opening income concerned and here there isa sina amount s there on land pares sale and some amount is Page 7 of 17NCC NCC Limited Nitin Arora: Y.D, Murthy: Nitin Arora: Moderator Subramaniam Yadav VD. Murthy: Subramaniam Yada V.D. Murthy: ‘Subramaniam Yada Y.D. Murthy: Subramaniam Yadav ¥.D. Murthy: Subramaniam Yadav V.D. Murthy: RS Raju Nagarjuna Construction Company Limited August 12, 2016 fiom the realestate division where we have the reul estate in Bangalore withthe sale of ats and also some parts represents on the higher income from machinery How much it contributed to your profit? Should we take ion account around 8 409 Crores? About 4 to 5 Crores contributed tothe EBITDA level “Thank you very much Sir. Thank you. The next question is fom the fine of Subramaniam Yadav of Subbk ‘Verures, Please go ahead Sir just wanted to understand the onder of $000 9 S000 you mgationed in the mobilization advance Is the irigation order from AP or the Telangana region? Telangana. The irigation, drinking water project is from the Goverament of Ten Sir, what would be the EBITDA margin in that projet? The EBITDA margins would be around 10% 0 12 108? 10% 10 12% Further can you give us the breakup of the other income? ‘Other income basically main part 9M is interest income and rests we are meeting some cv the rental income, some 50 lakhs is fromthe miscellaneous expenses ‘907% is rom the subsidiary right? ‘Yes from subsidiaries and some interest what we collect fom down the level trom subcontractors and others wher swe give the interest bearing foans whenever we receive the advance vobiliation advance from clients with interest and also down the evel also whieh aus interest ut of 28.6 Crores of other income that we have exported in he First quarter about 26 CCeores is on account of interest income on founs and advances given to our subsidiaries? Page 8 of 17NCC NCC Limited Subramaniam Yadav YD. Mucthy: Subramaniam Yadav Moderator: Ashish Sha YD. Murthy: Ashish Shab .D. Muethy: Ashish Shah: ¥.D. Murthy: Ashish Shah VD. Murthy: RS Raju Ashish Shah YD. Murthy: Ashish Shab Nagarjuna Construction Company Limited August 12, 2016 But have you actually received this amount or whether this has boon again given back as 2 team wasance oF nerement? 640% 0 70% we have received and halance we are accounting on accra asi Thank you Sie ‘Thank you. Nest we have Me, Ashish Shah of IMEC Sosurtes, Please go ahead Sir, could you give me a breakup of your working capital levels 3s inthe entire inventories, receivables and al ofthe items? Just a minuie, [will give you. Environmental is 438 Crores, work-in-progress is 1360 Crowes, and property development cast is abeat 16.4 Crores. Trade receivables ane 1361 (Crores. That is receivables, Short-tsm loans and advances are 2451 Crores. Current assets are 1660 Crores ‘On the eurent liabilities and provisions right here? (Current lability is trade payables 2143 Crores, current Tisbility is 1750 Crores, Short-term provisions 72. Crores and short-tenn borrowings 1735 Crome: these are the current labile, On provisions Si? Provisions 73 Crores Sir what would be the overall working capital days at she end ofthe quart”? 115 days are there Debt collection period is 65 days and working capita days is about 195, 115 days, Just lastly on ee land part which we mentioned, so what could he the revenue on ‘hat the entire other operating income could be taken for land and propery sales or ‘machinery sales, which you mentioned or part ofthe other operating income could be that. “These two elements are there, machinery hire charges and the real estate propety se Soby and large other operating income could he that? Page 9 of 17NCC NCC Limited Y.D, Murthy: Ashish Shak: Moderator: Vinay Kakkad Vp. Murthy: Vinay Kakkad Y.D. Murthy: Vinay Kakkad: Nagarjuna Construction Company Limited August 12, 2016 Ves. Thank you, Thank you, We Rave the next question trom the line of Vinay Kakkad of Marval Securities, Please g0 ahead ‘Good evening Sir. Actually 1 want to congratulate for good set of numbers. My question is Tike recently we have soon inthe Gujarat government has brought & system of tll revenue ‘collection from stall personal vehicle so will dhere he any effet if this kindof potcy will be implemented throughout Indie and will i afTeet any kind of company's revenue oF EBITDA margin? ‘That isa hypothetical question, Ht 6 fficule wo answer, but fist oF all, we ate monetizing fur road assets. We already sold western UP, which isa toll road project so whether the restriction hy the government agencies will be there on tll eolletions or not it will be the headache of the new incoming owner, Likewise, the Bangalore elevate toll-way’ also we Fhave monetized but the only thing is atoney is to be receive, | Taki i Hikely 4 come inthe next one month. We have one small project Pondicherry Tindivanam: however, do not think there is any problem there. If anything is there, we will fae i at that time. We have {got a concessionary in our favor, definitely if any such thing happens the client has 10 ‘compensate us, i there fs a Toss of the revenue hecause tolls ace nt allowed fo he eatlcted then they have to pay us. That sas simple as that My second question is like company as per the other guidance in nnual guidance ike they have suid that they will achieve 10% grouth in revenue forthe next year aml actually {or this quarter the company has achieved this 1% math so will i continge forthe next couple of yeas or what wll be there higher growth in this level? Every year we will work out a business plan, presen it fo the board, and based on that we sive sort of guidance to the tock exchanges and 10 the investors. Based on the business ‘an approved by the board, this year we are targeting 10% whereas next year how it will he ‘unless we work out a husiness plan of next year, it willbe difficult to say at this point in time andl also we are ating higher order aceretion in the current year, neatly 12500 Crores and if that secretion happens and the oer book will also ioprove so that will help 1s to improve the topline growth, hut Lam confident going forward every year forthe next three to oar years at least 10% 0 15% topline growth is definitely possible, ‘Thank you, Sir Page 10 of 17NCC NCC Limited Moderator: Saket Kapoor: ¥.D. Murthy: Saket Kapoor: Y.D. Morthy: Saket Kapoor: RS Raju: Saket Kapoor: YD. Murthy: Saket Kapoor: ¥.D. Murthy: Saket Kapoor: VD. Murthy: Nagarjuna Construction Company Limited August 12, 2016 ‘Thank you. We have next question fiom the line of Saket Kapoor of Kapoor Company Please go ahead. Gov evening Si Thank you for taking my question, Sir, fest of all what is dhe receivables from our subsidiaries as of June? Receivables from the subsidiaries? ‘Yes Sit, The loan amouot that is eeeived feom the subsidiaries and what was the Figure 2s fon March 2086? 1 just wanted to know whether we have received any: money for this quarter or not? You are asking about the loans with the company? In total we have received shout 320 Crores from the group companies towards the leans which are given cali ‘What isthe oustanding amount Siras on June 30? 1 is 935 Crores, loans and advances to subsiares at the ond oF the Fist quarter itis 935 (Crores atthe beginning ofthe year it is 1367 Crores so there is a substantial redustion inthe fons ond advances to the group companies in the current quarter? Sir. this we have received cowards dhe end of the quarter or beginning, just to work out whether interest costs ll o down further due ca receivable ofthis money going forward? This was in the mide oF the quarter we received the amount Does this benctit? So this 300 Crores henelt will percolate to the Seprember quater 00 ‘entirety? Meaning our working capital requirement will be dows due to this Fund coming. ‘We will have to see that one how the things take place. Means we have taken up some projects with our mobilization advance, the eoads also require money, but of course even this dubt at this movement, the fevel is there, that will gost and absorb the cost sinee the projeots have some margins because of no mobilization advan. Sir, could not et you, come aga? Even if Tmaintain the debt at this fevel apart from what t received in the rovent past can sdssorb the intrest cost and higher margin when mobilization advance is no dra, Page 11 of 17NCC NCC Limited Saket Kapoor: RS Raju: Saket Kapoor: YD. Murthy: Saket Kapoor: ys Murthy: Saket Kapoor: Moderator: Ankita Bhora: ¥.D. Mucthy: Ankita Bhors ¥.D. Muethy: Ankita Bhora: Nagarjuna Construction Company Limited August 12, 2016 Sir onthe eating par, have we ever fo convince the rating agencies so that We ean go for pw lower interest rites, the competitive rate fiom the banks? {have already answered this question, Maybe the rating exereise willbe completed by the ‘end of this month and we are expecting rating improvement also, Based on that will he approaching our banks for @ possible reduetion in commission and interest rates, Sie this loan wil he totally off by March 2017 fom che subsidiary the 900 Crores also we are expecting? ame. it wll not happen. ‘What sour plan Si? How can we achieve dill March 20172 10 to 50 Crores posibilis will be hae, if those companies manetize thei assets hank yo. Thank you, The neve we have Ankita Bhoes of BK Securities, Pease go ahead Sir list few quarters we are secing that we are selling realestate Land parcels, so just ‘wanted to understand how much lad bank is pending as of now and what is he plan going forward? [As por as NCCL lund pockets are concerned, we do not any much land pockets at this moment except one of to land pockets, Only urban company fas the land pockets. So there already as a business update some 0 fe land pockets they have pat for the sale ‘din the current year in 2016-2017 there are likey terms of selling one big land pockst so thereby they expect to get some 114 19 150 Crores that 150 Crores they want 0 utilise to ‘edhuce thir loans. That amount wil come again back tothe NCC parent company. ‘This cate money will come to NCC Parent? The entre amount will ome to NCC except some 10% t0 20 the operations of their business, Their intemal target is to reduce the loan to the parent company because the interes sal shared hut for dei operations, Anything has come in so far as From the urban inf Page 12 of 17NCC Limited Y.D, Murthy: Ankita Bhora: VD. Murthy: Ankita Bhora: ¥.D. Murthy: Ankita Bhor Y.D. Murthy: Ankita Bhor Y.D. Murthy Ankita Bhora: Nagarjuna Construction Company Limited August 12, 2016 LUrhan infza early in the first quarter 20 to 25 Crores inflow has happened tos partly for the interest andl party for she principal payment and as far asthe land sie is concerned We Aid not revive, only some advances they received trom token advances but the reat sakes ‘configuration they have aot yet received but they are expected to receive sae configuration in a couple of moms. Once that happens they will payback our loan amount. \Where is this one big land parcel that you are talking about? ‘One lanl pocket is at Kokinada and some lan! pockots at Hyderabad and some land pocket ‘Ga for ome and a hall year they ae eying fo sel that one and they ate clearing whatever legal things are there that process is 0, Sit, how would be our total exposure in terms of investments and loans and advances Inemationat subsidiaries and wha is the prouress there and what ane the ways of eevoveting that money? Infemotional companies the investment there are 66 companies one is Intra Mauritius Company and ethers are eur constuction eompanies, Dubai Company and other is Muscat Company, There the investment and loan put together are there it each company, roughly 10 and oud Crores would be there, tally 200 Crores should be therein both Muscat and Dubai, So they are doing this business. Onee thir projest and the returns hack the money they wil lear the oan By whem is that expected?” Ie depends upon the business. Ithey receive any new orders again, they put that money’ into sow orders. Are we looking at new orders there? Is the subsidiary looking at new orders there? At this moment, hey do not int t0 go for any fower margin business and the objestve is hot to camry sith Tow margin and go for competition like that itis there. Sometimes if we ‘vant co mamta the business or (9 recover the expenses and eer Sevemes or the existing projects are taking some more tine to complete those things in the meantime if any good projects come they will tke business call whether to go for that ome or not, lke that it is ther. Just ome fst, could you just tell me the pending outstanding investanents én ata and urban inex? That i from my side fia Moldings and NCC Urban Infra? Page 13 of 17NCC NCC Limited YD. Murthy: nkita Bhora: Moderator: Danesh Mistry: V.D. Murthy: Danesh Mistry: Y.D. Murthy: Danesh Mistry: RS Raju: Nagarjuna Construction Company Limited August 12, 2016 ‘You have already asked something the Gulf things, which Mr. Rao kas explained. 1 wil tell you the total investments and total group expesure of NCC related all our subsidiaries, both domestic and international put together and in fat the group exposure last year atthe cad of March 2016 was 2524 Crores it has come down to 1966 Crores inthe fst quarter ‘mainly because of the monetization of Western UP anu also repayment of debt by NCC Infia to the Parent Company. So our elforts te ring down these things are continuing and ‘debt also lst year it as 1367 Crores, it has come down to 985 Crores at the endl ofthe fist “quarter, That is mainly because ofthe ICD intracorporate deposit pal by NCC Ina that fo the parent company out of the sake proceeds seovivad by Sembeorp asa porter project. So ‘our aim is continuing and se wil bring it down group exposure further as and when assets ate monetized ‘Sure that sal from my se, Thank you. Thank you very much, The next question is rom the line of Danesh Mistry of Tat Mutual Fund, Please go ahead, Good evening. Thank you for taking the time out to fk 40 us H logged into our eal a bit Tote, so | just had one question on the order ok is chat we are sitting on a oeder book of let ts say 1900, so what isthe kind of any order hook guidance dhe we are talking about and in which segments and geographies could we look o get thse orders? Thak you This quarter we secured about 3620 Crores and in which the buildings and toad segment recived 1110 Crores No, Sir Lam saying forthe full year? For the full year? Any guidance that we could share and possibly which seyments and geographies would we sgt these orders ftom? See we are looking at an order avcretion forthe current year oF about 12000 Crores as ‘compared 0 7500 Crores last year and itself is more than 5iM% inerease, We are very confident we will he able @ achieve it, We are a company with all India operations. We sctually have a decent realization system of bidding for projects and wherever opportunities caanate we will be pariipating in those projects and the focus will Be on buildings and water pipelines where we have got steong execution capabilities and these two vetieals put together costs neatly 65% to 70% ofthe ander book as well as tumover ofthe company that is likely 1 coatiaue in the current year. We are active in the Telangana projects, Telangana Page 14 of 17NCC NCC Limited Danesh Mist YD. Murthy: Danesh Mistry: VD. Murthy: Danesh Mistry: ¥.D. Murthy: Nagarjuna Construction Company Limited August 12, 2016 state irigation and water bidded projeets and also we are leoking at the AP state capital formation building cowiracts as and when they are awarded, being 2 local player we are nicely positioned to capture chem, Recently we have bagged a road contract also forthe AP capital city and likewise we are looking at eash contracts in the road sector, not only from NHAL but ko from the various state governments and also we are looking at the HAM projects, whereas hybrid model oad projests at NHAL is bidding out we are examining da and carefully we will bid for that and also now initiative we have taken is the mine developer and operator, MDO projects we are looking at them positively and proudly we have bidde some projets thereaso, For the HAM ant for the MDO Sir any kind of capital outlay that we could be looking at? You sce for HAM itis very ele 40% af the projets cust is being paid by NHAL and so the developer has toring 40% and i he is able tie up debt in dhe cao of 3:1 from the banking system, the hanks will pay 43% oF the prajeet cost and he has to bring 15% of the project cost as his contribution as equity, Suppose HAM projets of 1000 Crores we have ta bringin equity 15010 18D Crores Got it, would we look at some major amount oF equity geting into dese HAM projets oF would we focus more on the other projects? We will not go beyond 200 Crores, The idea is because in Western UP and BETL Hengalury Elevated Tollway by monetizing these eo assets we are getting eash of neatly 200 Croces and it wakes sense to partieipate in BOT or hybrid model BOT which is ooking ester now mainly Because the tae risk is not there, Earlier inthe BOT mul, t put 0% cxiity now have to put only 1% equity and also the tafe risk is not there and also the ‘competition levels are comparatively fess, so We are looking at it perhaps as you know se never bid so aggressively fr these projects Just two questions, if C may, one is on the MBO what is the kind of ration that we are sovinyg on the ground with some of he large operators? “The projects are having a Hie of 25 0 30 years and the value of che prjexts om an annual basis the tumover would he in the rage of 708 40 1400 Crores, So basically those projects require the machinery and followed by some infia facilities. So th achinery in et can casly tie up the foan For she machineries since the materials are available in the market. So the project what we have got oF looking for that one iS does not require any gestation perio. it will stat che commercial production. So we build 2 model finance mevdel whereby. it requires only hardly of 104 to 208 Crores capital that we can sort the hig projects into operations, Since it would nut require any gestation period i€ generates the revenues fom Page 15 of 17NCC NCC Limited Danesh Mistry YD. Murthy Danesh Mistry V.D. Murthy Danesh Mistry: V.D. Murthy: Danesh istry: YD. Murthy: Danesh Misty Moderator: Parvez Akhtar: YD. Murthy: Parves Akhtar: YD. Murthy Nagarjuna Construction Company Limited August 12, 2016 ‘evan month onwards thereby the projet is abe to pay the interes ate from the beginning ‘without any accumulation during oF IPC type of costs, So in sueh a madet we are looking satisfied. But are these projects Forthcoming in the market, Sirat the moment? Yes, prajouts have come. One project we hav already bidded and we got that project and swe ate waiting forthe ise f the Final LOA with agreement Solis it hike a1 Kind of thing there aso? Yes, we became LI and shorly they will issue ths Final LOA and che agreement copy They are soning out some certain fasten, at the client Fevel hey ate working on the proces. Siro ast question. The AP contracts ae they’ sso on 2x0 meditation? [No they te giving mobiiaton ance APs giving. ts Yelangana wre the mobilization partis not hare? Mobilization partis not ther. Thank you very much, Wish you the very best of luck Thank you very much, The ment question isthe fast question fom the line of Parvez. Akhtar oF Edelweiss, Please go ae Jud evening Sit, Congratulations for good set of numbers. Sir, you mentioned that we Ihave received 320 Crores fron ut subsidiaries, so dhink part you said has come from NCC Urban, Whats the quantum that we received trem NCC Inia inthis quarter? NOC fea Holdings iy 309 Crones we received ‘And now considering that our loans to subsidiaries have fallen to about 930 odd Kevels what {is the kind of other income that we wil Seo for Tet us say’ For the whole of FY20179 Will we touch about 10D-0dd Crores? Yeo. it should be between 90 andl 100 Crores because last year it was almost 190 Crores this ‘ear it wil be below 100 Coores. Page 16 of 17NCC NCC Limited Parver Akhtar: Y.D. Murthy Parver Akhtar: YD. Murthy V.D. Murthy Jaspreet Singh Arora: Moderator: Nagarjuna Construction Company Limited August 12, 2016 Lastly Sir, what is our net current assets a the end oF QU? Current assets are 3675 Crores including the advances to group companies, When we exclude th oup company loans the met current assets are 2740 Crores Thank you, That sit fom my side, Al dhe hes fo tur Thank yo {We thank all the participants for thir enbusiatic participation and if anybody got any other questions they can send me sn email or call us separately. We will take care of your ‘questions, Thank y ou very much, Thank you Mr. Murthy an! good evening, Thank you. On behalf of Systematix Shares that conclades this eonference. Thank you foe joining ws. You may now disconnect your ines. Page 17 of 17