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Business Strategy

Presented By:
Swaroop Das Chowdhury (2013D04)
Subhashini N. (2013D17)

Company Profile:
IRB Group
IRB Infrastructure Developers Ltd. was incorporated in 1998 to fund the capital requirements of the IRB Group initiatives in the
infrastructure sector.
One of the leading Infrastructure Development company in India in road & highway sector

Focus Vertical
Undertake development of various infrastructure projects in the road sector through several SPVs.
The company, along with its subsidiaries, has constructed or operated and maintained around 8,000 lane kms. of road length so
far and one of the major road developers in the country
The aggregate size of all their BOT projects (both completed and under execution) is around Rs. 170,552 Million.
Hold market share of 11.07% on the golden quadrilateral

Strategic De-risking
Greenfield Airport Projects

Develop Real Estate

The IRB Group


Roads

Engineering,
construction and wind
power

Airport

Real estate

Hospitality

One of the
largest BOT
project
portfolio in the
roads and
highways sector

21 BOT projects

Modern road makers pvt. Ltd

Robust order
book of Rs.
115873 mm

IRB sindhudurg airport Pvt. Ltd


Aryan infrastructure
investment pvt.ltd

Aryan hospitality pvt.ltd

Professionally
managed
company with
qualified and
skilled
employee base

21 BOT projects
out of which 16
are operational

Key
competitive
advantage

Integrated and
efficient
project
execution
capabilities

Strong financial
track record
and relationship
with leading
financial
institutions

OPERATIONAL BOT PROJECTS


NAME OF THE PROJECT

PROJECT COST AS APPRAISED


BY THE LENDER(Rs.Mn)

Surat dahisar

25372

Bharuch surat

6736

Tumkar chitradurga

11420

Telegaon amravati

8800

Jaipur deoli

17330

Omallur salem namakkal

3076

Mumbai pune

13016

PROJECTS UNDER IMPLEMENTATION


Name of the project

Project cost

Pathankot amritsar

14453

Ahmedabad vadodara

48800

Goa/ karnataka border to


kundapur

26390

Solapur yedeshi

Approx.15000

Porters Five Force Model


Buyers Power:
Primary HIGH;
Secondary LOW
Primary buyer (Govt.)
has
high
bargaining
power
in
this
monopsonistic market.
Secondary buyer (end
user) is mandated by law
to pay tolls.

Threat of
substitutes
MODERATE
Reach of railways
restricted to span of
its network. MRTS
has
limited
infiltration and span.

Suppliers Power
MODERATE

Rivalry
Determinates
HIGH
A
high
returns
project attracts 1315 bidders. Margins
are to be sacrificed

Raw material suppliers


have
reasonable
bargaining
power
whereas subcontractors
have reduced power due
to in-house construction
capabilities of company.

Threat of New
Entrants
MODERATE
Proven track record
required for project
execution.
Strong
technical and financial
capabilities are also
needed.

BCG Matrix

Higher Market Growth

Airports, Real
Estate, Wind
Power
Question Mark

Star
Roads, ECC

Dog

Cash Cow

Higher Market Share

Hospitality

High
Medium

Investment and
Growth

Selective
Growth

(Roads)

(Engg. &
Constructio
n)

Selective
Growth

Selectivity

Selectivity

Selectivity

(Airport)

Harvest/Divest

(Real
Estate)
Harvest/Divest

Low

Industry Attractiveness

GE McKinsey Matrix

Harvest/Divest

(Hospitality
)
Strong

Average

Business Unit Strength

Weak

Industry Attractiveness:
Annual market growth rate
Overall market size
Historical profit margin
Current size of market
Market structure
Market rivalry
Demand variability
Global opportunities
Business Unit Strength:
Current market share
Brand image
Production capacity
Corporate image
Profit margins relative to
competitors
R & D performance
Promotional effectiveness

SWOT Analysis
Strengths

Weaknesses

Largest BOT player- pioneer


Strong Order Book position
Hedged against rising interest rates
In-house construction Strength
On-track execution
Sturdy financials

A Maharashtra centric
Company
78% revenues from 4
BOT Projects alone
Low investments in R&D

IRB
Opportunities

Growth in Infra industry


Road priority sector
Large ticket size road projects on the anvil
Focus on PPPs
Venture into Airport Development and
Real Estate
Economic growth picking up

Threats

Peoples perception
Land acquisition
Interest rate risk
Price escalation
Regulatory risk
Increased competition and aggressive
bidding
Project delays
Traffic dependent on economic growth

Speeding Ahead..
Pan India
presence

Innovation
and R&D

Enhancing and
evolving
capabilities

Nation-building
by strategic
venture into
infra sectors

The Strategy

To build upon our competitive strengths in the road infrastructure sector to become a market
leader in India that is, completing the order book of INR 115873mn in an efficient and timely
manner by strengthening our execution capabilities, adding to our existing pool of talented
managers, engineers, and facilitating continuous learning with in-house and external training
opportunities, and achieving this by continuing to focus on pursuing funded construction
contracts, particularly EPC contracts, as such contracts enable us to move up the value chain to
become the principal contractor on our funded construction projects.

Thank You!

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