On Contract

We have grown at a CAGR in excess of 50 per cent

October 2011
Atul Tantia, Executive Director, GPT Infraprojects

While most Indian infrastructure companies are busy grabbing multiple pieces of the Indian infrastructure pie, some are perfectly content with just one piece. A prime example is GPT Infraprojects, a subsidiary of Kolkata based GPT Group. Having carved a niche for itself in the steel girder bridge industry, this ISO 9001:2000 company prides itself on its impeccable project delivery. Riding on the company's recent inauguration of a new sleeper manufacturing facility in Namibia in partnership with TransNamib (Namibia's railroad service provider), Atul Tantia, Executive Director, GPT Infraprojects, highlights the company's milestones and projects in conversation with Shanti Padukone. Excerpts…
From the beginning: GPT Infraprojects has come a long way in the infrastructure sector. With almost 30 years experience in the sleeper division business, led by our promoters DP Tantia and SP Tantia, we made a foray into the infrastructure sector around eight years ago. Our close contacts and industry experience, not to mention a lot of parentage in terms of experience with Indian Railways and other government organisations, made this transition seemingly effortless. Essentially, we are involved with the execution of infrastructure projects (mainly bridges) and the manufacture of concrete sleepers as well as wind power generation. We renamed our infrastructure division to reflect the company's core areas of operation.

Respective divisions: GPT Infraprojects operates primarily in two divisions: the sleeper division and the infrastructure division. While the former is involved in the manufacture of concrete sleepers for railway systems in India and abroad, the latter is involved in civil infrastructure projects for railways, roads, airports, and urban infrastructure. We manufacture and supply the entire range of concrete sleepers, including regular mainline sleepers, approach bridges, deck level crossings, etc. Most of our sleepers are bought by the Indian Railways. We also supply our products to semi-government and private power and steel plants in and around the region. Internationally, we have operations in Bangladesh, Myanmar and Sri Lanka. We have also set up factories in South Africa to supply sleepers to Transnet Freight Rail. Our newest factory in Namibia is the latest feather in our cap! Namibia's stability, sound economic status and tax incentives are some of the reasons we have invested in the country. It is on a rapid rise with the growth of local industry and increasing demand for quality products, giving ample opportunity for investors like us to set up a strong infrastructure in the country.

Every milestone counts: GPT Infraprojects has grown at a CAGR in excess of 50 per cent. In fact, last year, we also
had a private equity firm invest in our company, which added to our corporate governance and shared value. Having completed some large contracts for the Railways, like a 103 m, single-span bridge – the largest to date by any private company in India – we are currently conducting the fabrication and extension of a large rail-cum-road bridge over river Ganga in Patna, the turnkey construction of 38 bridges for Tripura PWD, bridges for Eastern Railway with large pile foundations and steel superstructure, an NHAI BOT project in North Bihar, and the turnkey construction of five road-over-bridges in Kerala. One of our other milestones is the supply of 750,000 concrete sleepers in Mozambique for World Bank funded projects. We also constructed a bridge that was washed away by floods in the South Eastern Railway line within nine months, much ahead of schedule, for which we were awarded the Service of Contract Excellence by the Railways.

The high point: We take pride in the way we execute our projects. Our focus has always been on contract execution and excellence in completion of contracts. In other words, we always ensure our projects are completed on time, within the bud-get and with the necessary quality parameters. Within the infrastructure sector, we have tried to develop a niche for ourselves in the construction of bridges, especially steel girder bridges. Today, we have the largest order of steel girder bridges in the country. Moreover, our international operations have contributed a healthy input to our bottom line and top line.

Industry's challenges: The challenges in the industry are many. Today, we face paucity of manpower, rising interest rates and fluctuation in the prices of raw materials. Although all our project contracts have price fluctuation formulae linked to the cost, the index does not really capture the dynamism of the prices. Hence, we face a lot of uncertainty in price in terms of the margin. While, these are general issues faced by the construction industry, bridge construction has its own challenges. However, these depend on the kind of bridge being built and the terrain it is being built on.

Technology and engineering: Bridge construction is not a very technology-driven business; what it needs is more engineering skills. We use all kinds of equipment in our construction projects, from hydraulic rigs, cranes and excavators to batching and hot-mix plants. We are currently executing a project under an NHAI-BOT contract in North Bihar, where we are using our entire range of equipment. We had also laid an airport runway for Airports Authority of India, where we had used concrete pavers.

Infrastructure imperative: I believe we have a large requirement for infrastru-cture both in India and internationally; however, the focus on infrastructure in India has been lost and government policies need to be more streamlined. Nevertheless, the infrastructure industry in India must grow; otherwise the promise of an 8-10 per cent GDP growth cannot be fulfilled.
Land acquisition: I don't have any views on land acquisition; it is a politically sensitive topic! Nonetheless, we have faced problems owing to land acquisition. One example is that of the NHAI BOT project in North Bihar; work has been delayed as the authorities are yet to hand over the land to us.

The future: Our only plan for now is to grow. Our steps will depend on the government's policy and its current focus.

Fact sheet

Year of Establishment: 1982
Top Management (Promoters): DP Tantia, SG Tantia,  
No. of Employees: 1,230
Centre of Operation: Kolkata (Headquarters)
Ongoing Projects: Rail-cum-road bridge in Patna; 38 bridges for Tripura PWD; NHAI-BOT project in North Bihar.
Turnover: `445 crore  
Current Order Book: 1,280 crore (Only infra)