We are leaders in the verticals we operate in

01 Jan 2014 CW Team

How critical is the contribution of first-mover advantage towards ensuring the sustainable growth strategy of a company? Well, the answer is crystal clear when you examine the legacy of the most respected company in India for almost one-and-a-half centuries. Revered for its adherence to strong values and business ethics, the Tata Group has pioneered several firsts in the Indian industry, including the country´s first private-sector steel mill, first private-sector power utility, first software company, and first luxury hotel chain, to name a few. What´s more, this multinational business behemoth with a combined turnover of $100 billion is currently busy building a series of world-class, world-scale businesses in select sectors. TPL, a subsidiary of Tata Sons Ltd, is on a roll in pursuing numerous new frontiers as it gears up for the next growth wave of infrastructure in India and abroad. Since it was established in 1979 as an engineering, procurement and construction (EPC) company in the engineering sector of the Tata Group, TPL has swiftly transformed itself into one of the fastest growing and most admired infrastructure companies in India.

Gearing up for growth
Armed with expertise in executing large and complex industrial infrastructure projects, TPL is fast spreading its wings into urban infrastructure services including metro rail projects, water management and special economic zones as well as international markets. These mark new addressable markets and new geographies for its business verticals, which traditionally focus on EPC services for power, power transmission and oil and gas.

´Within our business verticals, we are looking at increasing scope and scale, new addressable markets and new geographies,´ affirms Vinayak Deshpande, Managing Director, Tata Projects Ltd. ´Also, new business growth shall come from not just the EPC business but through Build-Operate-Transfer (BOT), Public-Private Partnership (PPP) and construction projects. We are venturing into urban infrastructure wherein we have synergies with our industrial infrastructure, like urban transport. These new forays shall cumulatively drive growth in the next three to five years.´

Growth drivers
TPL operates through seven strategic business units (SBUs) power generation, transmission and distribution, railways, water and wastewater, metals and minerals, quality services and oil, gas and hydrocarbon to execute EPC projects within timelines with high quality and cost consciousness. Besides, the company has its own state-of-the-art tower manufacturing unit near Nagpur.

´There are some segments like construction projects, transportation systems or even some specific segments of the industry that continue to perform in the most challenging economic scenarios,´ says Deshpande. ´For the next three years, we see a portfolio of such business that shall drive growth and de-risk revenues. Our current order book is bullish on transmission and railways while there are opportunities in the pipeline from international markets. Thus, it is largely evenly spread out, slowly but consistently growing.´

Meanwhile, Sunil Srivastava, Governing Council Member, Institute of Metro and Rail Technology (IMRT) and Managing Director, BARSYL, believes that being a part of the Tata Group is a great advantage for TPL. Speaking from his experience of about 20 years in marketing, business planning and project management of rail infrastructure projects in India, the UK, Singapore, Malaysia and Bangladesh, Srivastava observes, ´This helps TPL hire the best talent, forming strategic partnerships with other companies or bidding for new projects. The presence of group companies in sectors such as steel and power acts as an added plus for TPL´s order book.´

At the same time, he acknowledges the due credit to TPL on its outstanding accomplishments as the company, which began with power projects, has capabilities for executing projects in oil and gas, hydrocarbon, metals, minerals and railway sectors today.

Robust performance
In 2012-13, TPL had a turnover of Rs 3,590 crore and a profit after tax of Rs 84.9 crore. As of November 2013, the company has about Rs 12,925 crore worth of orders in its order book.

´The dedicated freight corridor, a super critical thermal plant in Krishnapatnam (Andhra Pradesh), a blast furnace at Nagarnar (Chhattisgarh), and transmission lines across the National Grid are some of the large projects under implementation,´ shares Deshpande. ´We have also won three transmission projects in Kenya and one in Zambia. Therefore, our order book is getting richer from international markets.´ Srivastava commends the performance of TPL as being much better than its peers over the past five to six years, with the company growing at a CAGR of about 20 per cent. ´From a mid-sized EPC player some time back, today TPL is bidding for and winning large projects and entering the big league of EPC companies,´ he observes. In June 2013, India Ratings and Research (or Ind-Ra, a Fitch Group company) had affirmed TPL's rating with stable outlook, reflecting the company´s comfortable liquidity position and credit profile. The credit rating and research agency stated, ôInd-Ra expects the revenue mix (of TPL) to tilt towards the power generation segment. This is because around 60 per cent of the current order book consists of higher-margin power generation projects and the T and D segment´s share in the order book has reduced to 21 per cent.´

Partners in progress
One of the key achievements of TPL in 2013 includes commencing work on the Eastern Dedicated Freight Corridor (EDFC) project that it had won in partnership with Aldesa of Spain. This was the first major contract awarded for the EDFC through an international competitive bidding process. RK Gupta, Managing Director, Dedicated Freight Corridor Corporation of India Ltd (DFCCIL), informs that there is steady progress on all fronts in the DFC project and adds that DFC has just implemented an SAP-based ERP system through which all transactions in the project shall be carried out from January 1, 2014. This is the first case in railways where SAP-based ERP has been implemented at such a scale for resource planning, programme implementation and progress of the project.

Earlier in 2013, DFCCIL has awarded one major civil contract each in both the corridors to prestigious construction companies along with international JV partners. While TPL was awarded a contract of Rs 3,300 crore in JV with Aldesa from Spain for civil works in the Bhaupur-Khurja section of the Eastern Corridor, L and T in JV with Sojitz of Japan received the contract of about Rs 6,700 crore for civil works in Rewari-Iqbalgarh section of the Western Corridor. ´These firms are our partners in progress and shall play a key role in timely completion without any compromise on quality,ö adds Gupta.

From a supplier´s perspective, Jindal Steel and Power Ltd (JSPL) has been associated with TPL for many years.

As Vijay Kumar Chama, Vice President (Sales and Marketing), JSPL, explains, ´Our relationship has grown in strength. TPL is growing at a fast pace in line with industry needs and JSPL has supported it in every possible way; this is mutually beneficial.´

The road ahead
Of late, TPL has been focusing on complex projects based on advanced technology rather than bidding for projects across the segment. ´Engineering is the core of our EPC business,´ says Deshpande. ´The fact that we could successfully overcome the adverse market scenario bears testimony to our strategy. Now, increase in scope and scale will ride the next growth wave.´ Srivastava believes that TPL has prepared itself well for long-term growth after having organised its business across seven core infrastructure sectors. ´The railway SBU especially has bagged high-value projects that should pave the way for many more,´ he says. As the core sector gets set for revival with the rollout of the infrastructure debt funds (IDFs) as well as ongoing discussions to improve the PPP framework, TPL looks forward to huge opportunities in India and abroad. This isn´t just first mover action but fast mover action!

TPL´s hallmark of excellence
Vital stats

In 2012-13, TPL´s turnover was Rs.3,590 crore with a profit after tax of Rs.84.9 crore.
Its turnover has grown at a CAGR of 23 per cent over the past five years.
Latest order book: About `12,925 crore as on November 2013.
TPL is one of the earliest and few Indian construction companies to acquire the triple certifications of ISO 9001, ISO 14001 and OHSAS 18001.
Currently, TPL has a 2,700 plus strong committed workforce spread across three regional offices, 15 regional inspection offices and three registered overseas offices, and project locations.

JVs and partnerships

TPL has acquired a majority stake in Artson Engineering Ltd.
TPL-TQA Quality Services (Pty) Ltd: A JV in South Africa and Mauritius to provide third-party inspection services.
Tata Projects Balfour Beatty JV: A JV with Balfour Beatty of the UK.
Tata Projects Aldesa JV: To build India´s first and only Eastern Dedicated Freight Corridor for Indian Railways

Landmark projects

Building one of the country´s largest blast furnaces at Nagarnar in Chhattisgarh for the National Mineral Development Corporation. This will be taller than the Qutab Minar.
Powergrid´s heaviest transmission line (283 km, 800 kv) supply and construction in the Barabisa-Moynaguri-Islampur section of the Biswanath Chariyali-Agra transmission line.
One of Andhra Pradesh´s largest super critical thermal power plants at Krishnapatnam, Andhra Pradesh (BOP contract).
Building the nation´s prestigious dedicated freight corridor for Indian Railways.

Corporate social responsibility

TPL´s employability and entrepreneurship support has benefitted 1,041 people who are now either employed or associated as subcontractors with it.
Its education support schemes have benefitted 11,200 students.

Quick Bytes

Addressable market size identified by TPL in the next three to five years: About Rs.80,000 crore to Rs.100,000 crore every year.
TPL´s new business growth areas: BOT, PPP and construction projects along with EPC.
The company is spreading its wings into international markets.

(With additional inputs from Shriyal Sethumadhavan)

...beams a confident Vinayak Deshpande, Managing Director, Tata Projects Ltd (TPL). The company is on a roll as it gears up for the next growth wave of infrastructure in India and abroad, writes MANAS R BASTIA. How critical is the contribution of first-mover advantage towards ensuring the sustainable growth strategy of a company? Well, the answer is crystal clear when you examine the legacy of the most respected company in India for almost one-and-a-half centuries. Revered for its adherence to strong values and business ethics, the Tata Group has pioneered several firsts in the Indian industry, including the country´s first private-sector steel mill, first private-sector power utility, first software company, and first luxury hotel chain, to name a few. What´s more, this multinational business behemoth with a combined turnover of $100 billion is currently busy building a series of world-class, world-scale businesses in select sectors. TPL, a subsidiary of Tata Sons Ltd, is on a roll in pursuing numerous new frontiers as it gears up for the next growth wave of infrastructure in India and abroad. Since it was established in 1979 as an engineering, procurement and construction (EPC) company in the engineering sector of the Tata Group, TPL has swiftly transformed itself into one of the fastest growing and most admired infrastructure companies in India. Gearing up for growth Armed with expertise in executing large and complex industrial infrastructure projects, TPL is fast spreading its wings into urban infrastructure services including metro rail projects, water management and special economic zones as well as international markets. These mark new addressable markets and new geographies for its business verticals, which traditionally focus on EPC services for power, power transmission and oil and gas. ´Within our business verticals, we are looking at increasing scope and scale, new addressable markets and new geographies,´ affirms Vinayak Deshpande, Managing Director, Tata Projects Ltd. ´Also, new business growth shall come from not just the EPC business but through Build-Operate-Transfer (BOT), Public-Private Partnership (PPP) and construction projects. We are venturing into urban infrastructure wherein we have synergies with our industrial infrastructure, like urban transport. These new forays shall cumulatively drive growth in the next three to five years.´ Growth drivers TPL operates through seven strategic business units (SBUs) power generation, transmission and distribution, railways, water and wastewater, metals and minerals, quality services and oil, gas and hydrocarbon to execute EPC projects within timelines with high quality and cost consciousness. Besides, the company has its own state-of-the-art tower manufacturing unit near Nagpur. ´There are some segments like construction projects, transportation systems or even some specific segments of the industry that continue to perform in the most challenging economic scenarios,´ says Deshpande. ´For the next three years, we see a portfolio of such business that shall drive growth and de-risk revenues. Our current order book is bullish on transmission and railways while there are opportunities in the pipeline from international markets. Thus, it is largely evenly spread out, slowly but consistently growing.´ Meanwhile, Sunil Srivastava, Governing Council Member, Institute of Metro and Rail Technology (IMRT) and Managing Director, BARSYL, believes that being a part of the Tata Group is a great advantage for TPL. Speaking from his experience of about 20 years in marketing, business planning and project management of rail infrastructure projects in India, the UK, Singapore, Malaysia and Bangladesh, Srivastava observes, ´This helps TPL hire the best talent, forming strategic partnerships with other companies or bidding for new projects. The presence of group companies in sectors such as steel and power acts as an added plus for TPL´s order book.´ At the same time, he acknowledges the due credit to TPL on its outstanding accomplishments as the company, which began with power projects, has capabilities for executing projects in oil and gas, hydrocarbon, metals, minerals and railway sectors today. Robust performance In 2012-13, TPL had a turnover of Rs 3,590 crore and a profit after tax of Rs 84.9 crore. As of November 2013, the company has about Rs 12,925 crore worth of orders in its order book. ´The dedicated freight corridor, a super critical thermal plant in Krishnapatnam (Andhra Pradesh), a blast furnace at Nagarnar (Chhattisgarh), and transmission lines across the National Grid are some of the large projects under implementation,´ shares Deshpande. ´We have also won three transmission projects in Kenya and one in Zambia. Therefore, our order book is getting richer from international markets.´ Srivastava commends the performance of TPL as being much better than its peers over the past five to six years, with the company growing at a CAGR of about 20 per cent. ´From a mid-sized EPC player some time back, today TPL is bidding for and winning large projects and entering the big league of EPC companies,´ he observes. In June 2013, India Ratings and Research (or Ind-Ra, a Fitch Group company) had affirmed TPL's rating with stable outlook, reflecting the company´s comfortable liquidity position and credit profile. The credit rating and research agency stated, ôInd-Ra expects the revenue mix (of TPL) to tilt towards the power generation segment. This is because around 60 per cent of the current order book consists of higher-margin power generation projects and the T and D segment´s share in the order book has reduced to 21 per cent.´ Partners in progress One of the key achievements of TPL in 2013 includes commencing work on the Eastern Dedicated Freight Corridor (EDFC) project that it had won in partnership with Aldesa of Spain. This was the first major contract awarded for the EDFC through an international competitive bidding process. RK Gupta, Managing Director, Dedicated Freight Corridor Corporation of India Ltd (DFCCIL), informs that there is steady progress on all fronts in the DFC project and adds that DFC has just implemented an SAP-based ERP system through which all transactions in the project shall be carried out from January 1, 2014. This is the first case in railways where SAP-based ERP has been implemented at such a scale for resource planning, programme implementation and progress of the project. Earlier in 2013, DFCCIL has awarded one major civil contract each in both the corridors to prestigious construction companies along with international JV partners. While TPL was awarded a contract of Rs 3,300 crore in JV with Aldesa from Spain for civil works in the Bhaupur-Khurja section of the Eastern Corridor, L and T in JV with Sojitz of Japan received the contract of about Rs 6,700 crore for civil works in Rewari-Iqbalgarh section of the Western Corridor. ´These firms are our partners in progress and shall play a key role in timely completion without any compromise on quality,ö adds Gupta. From a supplier´s perspective, Jindal Steel and Power Ltd (JSPL) has been associated with TPL for many years. As Vijay Kumar Chama, Vice President (Sales and Marketing), JSPL, explains, ´Our relationship has grown in strength. TPL is growing at a fast pace in line with industry needs and JSPL has supported it in every possible way; this is mutually beneficial.´ The road ahead Of late, TPL has been focusing on complex projects based on advanced technology rather than bidding for projects across the segment. ´Engineering is the core of our EPC business,´ says Deshpande. ´The fact that we could successfully overcome the adverse market scenario bears testimony to our strategy. Now, increase in scope and scale will ride the next growth wave.´ Srivastava believes that TPL has prepared itself well for long-term growth after having organised its business across seven core infrastructure sectors. ´The railway SBU especially has bagged high-value projects that should pave the way for many more,´ he says. As the core sector gets set for revival with the rollout of the infrastructure debt funds (IDFs) as well as ongoing discussions to improve the PPP framework, TPL looks forward to huge opportunities in India and abroad. This isn´t just first mover action but fast mover action! TPL´s hallmark of excellence Vital stats In 2012-13, TPL´s turnover was Rs.3,590 crore with a profit after tax of Rs.84.9 crore. Its turnover has grown at a CAGR of 23 per cent over the past five years. Latest order book: About `12,925 crore as on November 2013. TPL is one of the earliest and few Indian construction companies to acquire the triple certifications of ISO 9001, ISO 14001 and OHSAS 18001. Currently, TPL has a 2,700 plus strong committed workforce spread across three regional offices, 15 regional inspection offices and three registered overseas offices, and project locations. JVs and partnerships TPL has acquired a majority stake in Artson Engineering Ltd. TPL-TQA Quality Services (Pty) Ltd: A JV in South Africa and Mauritius to provide third-party inspection services. Tata Projects Balfour Beatty JV: A JV with Balfour Beatty of the UK. Tata Projects Aldesa JV: To build India´s first and only Eastern Dedicated Freight Corridor for Indian Railways. Landmark projects Building one of the country´s largest blast furnaces at Nagarnar in Chhattisgarh for the National Mineral Development Corporation. This will be taller than the Qutab Minar. Powergrid´s heaviest transmission line (283 km, 800 kv) supply and construction in the Barabisa-Moynaguri-Islampur section of the Biswanath Chariyali-Agra transmission line. One of Andhra Pradesh´s largest super critical thermal power plants at Krishnapatnam, Andhra Pradesh (BOP contract). Building the nation´s prestigious dedicated freight corridor for Indian Railways. Corporate social responsibility TPL´s employability and entrepreneurship support has benefitted 1,041 people who are now either employed or associated as subcontractors with it. Its education support schemes have benefitted 11,200 students. Quick Bytes Addressable market size identified by TPL in the next three to five years: About Rs.80,000 crore to Rs.100,000 crore every year. TPL´s new business growth areas: BOT, PPP and construction projects along with EPC. The company is spreading its wings into international markets. (With additional inputs from Shriyal Sethumadhavan)