WORKING CAPITAL

REQUIREMENT OF
KEC
INTERNATIONAL
PRESENTED BY :

SHEETAL CHAUDHARY
ROHAN TAMANEKAR
RITIKA DAYAL
BINAY TIWARI
KEC INTERNATIONAL
 One of the largest EPC companies in the
world.
 RPG Enterprises has a strong presence in 8
business sectors
 Providing EPC services to more 43 countries
across the world.
 As on date, KEC has the largest production
capacity in the world for tower
manufacturing of about 150,000 MTs per
annum
SWOT ANALYSIS
Strengths
One of the pioneers in setting up
turnkey project. Executed transmission
projects in some of the most
challenging climatic and topographic
conditions

Opportunities
• KEC is strongly place to
take advantage of the
expected strong growth in
the infrastructure sector
globally.
Threats
• Company is highly dependent
to the changes in the external
world.
• Volatile to Price fluctuations
PROJECT MANAGEMENT UNITS
 Power Transmission
 Power Distribution & Design Services
 Telecommunications Infrastructure
 Railway Infrastructure
 Cables Manufacturing
Power Telecommun
Cables Railway
Power Distribution ications
Manufacturin Infrastructur
Transmission & Design Infrastructur
g e
Services e
The biggest Strategic Business Unit (SBU) in KEC’s business portfolio.
This SBU executes power transmission projects on EPC (Engineering,
Procurement and Construction) basis globally.

Executed Substation, Distribution and Rural Electrification projects in

India and overseas and is presently executing numerous similar projects.

Manufactures a range of Control & Power Cables that are critical to the
distribution network of power utilities and for Industrial expansion.
Company is equipped and has expertise to provide end-to-end Total
Cable Solutions for Power Evacuation

Amongst leading EPC players to provide Telecom Towers on turnkey

basis to Operators, Tower Management Companies and
Utilities.Experience in laying OFC and OPGW cables on turnkey basis and
live line conditions.

The Railway division at KEC consists of a highly experienced and capable

team of experts in project management, design and project execution
across all the functional domains in Railways, namely Civil Infra, Tracks,
Electrification, power systems and Signalling & Telecom. The division
has developed a strong vendor base & logistic provider network in India.
INDUSTRIAL UNDERSTANDING
EPC Contract

Project Risk

Budget Risk

Competitors
BUSINESS PROCESS OF KEC
General payment
schedule Performance
The company makes a
10% - Advance Guarantee of 20% of
bid for a particular
the total project cost
project. 80% - Progress Payment
is given as a security
10% - Balance Retention

In overseas project,
Once an order is
The company wins 1 where company raises
bagged, all the
bid for every 5 bids money outside India,
guarantees have to be
that it applies for. Indian Bank can issue
issued within 10 days.
BG

Certain miscellaneous
Bidder is required to A big bond guarantee guarantees are issued
pay a earnest money is been issued instead by the banks when
deposit, as a security of deposit required, eg. Excise
duties
Partner Structuring ( Contract Scheme)
Consortium, Vertical Split, Joint and
Several
Joint Venture, Share Profit & Loss
Prime and Sub, Horizontal Split
BUSINESS MODEL OF EPC
COMPANIES
Risk Management
Technical, Commercial, Financial
Risk Analysis, Risk Transfer, Risk
Mitigation, and Risk Control
Global Resources Integration
Low Cost Engineering Offices
1st Layer Management by Expat
2nd Layer Management by 3rd Countries
3rd Layer by Local Sub
Support by Financial Institutes
Project Finance by EXIM Bank and
Commercial Banks
Bonding via Global Network
 ASSUMPTIONS
 Short term borrowings from banks are assumed to
increase in same lines with the sales.
 Other current assets are assumed to increase at
70% (average increase of last 2 Financial years).
 On an average 5% of the sales is taken as
advances from customers. Provision for taxation
is taken as 2% of PBT.
 Interest accrued but not due is assumed to be 1%
of the loans due after one yr.
 Unclaimed dividend is 2% of the dividend payable.
 Sundry Crs are assumed to increase at 86% in FY
11 and 12.
 ASSUMPTIONS
 Power and fuel exps increasing at 50% approx
as per past trend.
 Raw material consumed as per past trend
increase of 2% .FY12 2.5% increase
 Acquired material -utilised or sold.
 Export receivables - as 60% of the sales.
 Receivables - increase in lines with the sales
around 53% of the sales
 FINANCIALS

 KEC CMA.xls
THANK YOU